P.E.R.C. No. 2000-14, E Orange

CaptionSTATE OF NEW JERSEY BEFORE THE PUBLIC EMPLOYMENT RELATIONS COMMISSION In the Matter of CITY OF EAST ORANGE, Respondent, -and- Docket Nos. CO-H-99-23, CO-H-99-30, CO-H-99-31, CO-H-99-32, CO-H-99-35 COMMUNICATIONS WORKERS OF AMERICA, AFL-CIO; EAST ORANGE FIRE OFFICERS ASSOCIATION; PBA LOCAL NO. 16; EAST ORANGE SUPERIOR OFFICERS' ASSOCIATION; AND FMBA LOCAL NO. 23, Charging Parties. ¶

AppearancesAppearances: ¶

For the Respondent, McCormack & Matthews, attorneys ¶

(Thomas M. McCormack, of counsel) ¶

For the Charging Party, Communications Workers of America, AFL-CIO (Elaine Waller, representative) ¶

For the Charging Party, East Orange Fire Officers' Association, Balk, Oxfeld, Mandell & Cohen, attorneys ¶

(Gail Oxfeld Kanef, of counsel) ¶

For the Charging Party, PBA Local No. 16 ¶

S.M. Bosco Associates (Dr. Simon M. Bosco, consultant) ¶

For the Charging Party, East Orange Superior Officers' Association, S.M. Bosco Associates (Dr. Simon M. Bosco, consultant) ¶

For the Charging Party, FMBA Local No. 23 ¶

Courter, Kobert, Laufer & Cohen, attorneys ¶

(Fredric M. Knapp, of counsel) ¶

DECISION ¶

The Communications Workers of America, AFL-CIO, the East Orange Fire Officers Association, PBA Local No. 16, the East ¶

Orange Superior Officers' Association, and FMBA Local No. 23 represent various negotiations units of employees of the City of East Orange. Between July 24 and August 3, 1998, these representatives filed unfair practice charges alleging that the City violated the New Jersey Employer-Employee Relations Act, N.J.S.A. 34:13A-1 et seq ., specifically 5.4a(1), (2), (5), and (7),1/ when it unilaterally reduced the rate at which it paid workers' compensation benefits from 100% to 70% of the injured employee's average weekly wages. 2/ ¶

The SOA and the FMBA sought interim relief restraining the City from reducing workers' compensation benefits without negotiations. The FMBA argued in particular that this employment condition could not be changed during interest arbitration proceedings. N.J.S.A. 34:13A-21. Interim relief was granted. ¶

Note1/ These provisions prohibit public employers, their representatives or agents from: "(1) Interfering with, restraining or coercing employees in the exercise of the rights guaranteed to them by this act, (2) Dominating or interfering with the formation, existence or administration of any employee organization, (5) Refusing to negotiate in good faith with a majority representative of employees in an appropriate unit concerning terms and conditions of employment of employees in that unit [and] (7) Violating any of the rules and regulations established by the commission." The FMBA alleged violations of all four provisions; the police officers' representatives alleged violations of 5.4a (1), (2), and (5); the fire officers' representative alleged violations of 5.4a(1) and (5); and CWA alleged a violation of 5.4a(5). ¶

2/ The FMBA also alleges that the City violated the Act when it unilaterally implemented an alternate duty policy. That allegation is not before us now. ¶

I.R. No. 99-4, 24 NJPER 459 (¶29212 1998). In that proceeding, the City argued that fiscal constraints justified the reduction in benefits, but would not prevent it from making employees whole for lost benefits if a violation was ultimately found. ¶

On November 25, 1998, the Director of Unfair Practices consolidated the charges and issued a Complaint and Notice of Hearing. The City filed an Answer admitting that it had unilaterally reduced workers' compensation benefits, but asserting that it had a managerial prerogative and statutory right to do so. ¶

The charging parties moved for summary judgment and submitted certifications, exhibits, and briefs. The City did not respond. ¶

Pursuant to N.J.S.A . 19:14-4.8, the motions for summary judgment were referred to the Hearing Examiner, Wendy L. Young. On June 21, 1999, she granted the motions. H.E. No. 99-23, 25 NJPER 354 (¶30150 1999). She concluded that reducing workers' compensation benefits without negotiations and during interest arbitration proceedings violated N.J.S.A . 34:13A-5.4a(1) and (5). She recommended that the City be ordered to restore the previous level of payments and make whole employees who had their benefits improperly reduced. She recommended dismissing the alleged violations of 5.4a(2) and 5.4a(7). ¶

On July 8, 1999, the City filed exceptions. It asserts that workers' compensation benefits are not automatic and employees could not expect that level of benefits to be maintained from year to year. It also argues that it should not be required to negotiate over reducing benefits given its fiscal constraints. ¶

The FMBA filed a response urging us to accept the Hearing Examiner's recommendations. ¶

The Hearing Examiner's decision resolves all issues in the consolidated charges except the FMBA's allegation concerning the alternate duty program. We grant special permission to appeal the summary judgment ruling with respect to the FMBA's charge and entertain the City's exceptions on the other charges pursuant to N.J.A.C. 19:14-4.8(e). ¶

We have reviewed the record. The Hearing Examiner's findings of fact (H.E. at 5-6) are accurate. 3/ We adopt and incorporate them. These findings establish that the City had a longstanding practice of paying workers' compensation benefits at the rate of 100% of the injured employee's average weekly wages; the City adopted a resolution reducing the rate of payment to 70% of wages; and the City did not negotiate with any majority representative before doing so. We add that the City presented no factual allegations in response to the summary judgment motions and may not do so now in its exceptions. ¶

The Hearing Examiner's legal analysis (H.E. at 7-11) is sound. We adopt and incorporate that analysis and specifically ¶

Note3/ We supplement finding no. 3 by taking administrative notice that on July 9, 1997 the East Orange Fire Officers Association petitioned for interest arbitration. ¶

accept her determination that the previous level of workers' compensation benefits was an existing employment condition that could not be changed without satisfying the duty to negotiate under N.J.S.A . 34:13A-5.3. We add that the Appellate Division has recently affirmed the Middletown decision relied upon by the Hearing Examiner, Middletown Tp., P.E.R.C. No. 98-77, 24 NJPER 28 (¶29016 1997), aff'd NJPER (¶ App. Div. 1999), and we repeat what we said in Middletown: ¶

[T]he [City] is not bound to maintain its practice. It is simply required to negotiate before changing it.... If conditions have changed and the [City] believes that the practice should be discontinued, it is free to take that position in negotiations. [ Id. at 31] ¶

We will modify the recommended order to clarify that the City's duty is not to maintain the previous benefits, but to engage in the negotiations process before reducing those benefits. The City may present its fiscal concerns in negotiations. ¶

OrderORDER ¶

The City of East Orange is ordered to: ¶

A. Cease and desist from: ¶

1. Interfering with, restraining or coercing employees in the exercise of the rights guaranteed to them by the Act, particularly by not negotiating before reducing the workers' compensation benefits paid injured employees from 100% of their average weekly wages to 70% of their average weekly wages and by reducing those benefits during interest arbitration proceedings without the consent of the FMBA or the Fire Officers Association. ¶

2. Refusing to negotiate with the majority representative of employees in an appropriate unit concerning terms and conditions of employment of employees in that unit, particularly by reducing workers' compensation benefits paid injured employees from 100% of their average weekly wages to 70% of their average weekly wages and by reducing those benefits during interest arbitration proceedings without the consent of the FMBA or the Fire Officers Association. ¶

B. Take this action: ¶

1. Rescind that portion of Resolution No. 1-236 reducing workers' compensation benefits. ¶

2. Make whole employees who had their benefits reduced without negotiations. ¶

3. Negotiate in good faith with the Communications Workers of America, PBA Local #16, and the East Orange Superior Officers' Association before reducing workers' compensation benefits. ¶

4. Negotiate in good faith with FMBA Local No. 23 and the East Orange Fire Officers Association and complete interest arbitration proceedings before reducing workers' compensation benefits; ¶

5. Post in all places where notices to employees are customarily posted, copies of the attached notice marked as Appendix "A." Copies of such notice shall, after being signed by the Respondent's authorized representative, be posted immediately and maintained by it for at least sixty (60) consecutive days. Reasonable steps shall be taken to ensure that such notices are not altered, defaced or covered by other materials. ¶

6. Notify the Chair of the Commission within twenty (20) days of receipt what steps the Respondent has taken to comply with this order. ¶

The 5.4a(2) and 5.4a(7) allegations are dismissed. ¶

BY ORDER OF THE COMMISSION ¶

Millicent A. Wasell ¶

Chair ¶

Chair Wasell, Commissioners Buchanan, Muscato and Ricci voted in favor of this decision. None opposed. Commissioner McGlynn abstained from consideration. Commissioner Madonna abstained from consideration under protest. ¶

DATED: August 26, 1999 ¶

Trenton, New Jersey ¶

ISSUED: August 27, 1999 ¶