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Three NJ Towns in Fiscal Crisis Could Furlough Workers Without Union Talks, High Court Says
Updated On: Aug 14, 2015
The New Jersey Supreme Court hears oral arguments in Trenton in 2013. (Patti Sapone | NJ Advance Media for NJ.com)
NJ.com - TRENTON - Three New Jersey towns facing economic emergencies had the authority to furlough public workers and make other job cutbacks without negotiating with union representatives, the state Supreme Court ruled Tuesday.
New Jersey's highest court voted 4-1 in favor of Belmar, Keyport, and Mount Laurel, all of which made the cutbacks in 2009 when faced with budget crises because of the struggling economy.
"Economic reasons are indisputably a legitimate basis for a layoff of any type," Justice Jaynee LaVecchia wrote for the court. "All three municipalities acted for reasons of economy based on municipal fiscal distress existing at the time, rendering the management choice to use a temporary or permanent layoff solution one that constituted a managerial prerogative not subject to negotiation."
Justice Barry Albin was the only justice to vote against the decision, saying it "sweeps away nearly 50 years of this court's public-sector labor jurisprudence, giving municipal employers the unilateral power to reduce the wages and hours of public employees promised in collective negotiations agreements."
Each of the municipalities sought approval from the state Civil Service Commission for the layoff plans but did not negotiate with union representatives, according to court papers.
Keyport's plan called converting three full-time clerical jobs into part-time jobs, costing employees their health benefits.
Belmar's plan called for 10 unpaid furlough days for all public works employees.
Mount Laurel's plan called for eight unpaid furlough days for all township employees, except for police and emergency medical personnel.
Unions in each of the towns challenged the moves to the state Public Employment Relations Commission, which decided that the municipalities violated state employment laws that required them to negotiate such changes.
The towns appealed, and an appellate panel noted that the cutbacks were approved by the Civil Service Commission, which had a regulation in place at the time that allowed for temporary and permanent layoffs under emergency circumstances.
The panel said Keyport needed to negotiate the health benefit changes but ruled that the other cutbacks were legal.
The state Supreme Court agreed Tuesday, noting not only that the emergency regulation allowed for the cutbacks but that "there is no room for mandatory negotiation in the determination to reduce a workforce."
"Public managers must be the ones accountable to the people for such substantive policy decisions," LaVecchia wrote.
Gordon Litwin, the lawyer who represented Keyport, said he was "very pleased" with the decision.
"I think the court recognized the real world of municipal government and rendered a practical decision," said Litwin, a Newark-based attorney. "To have done otherwise would have unreasonably emasculated local officials."
Stephen Weissman, the attorney for three of the unions in the case — the Communications Workers of America, AFL-CIO, and AFSCME — stressed that the decision was based on an emergency regulation that has since been repealed by the Civil Service Commission.
"I think we see this as a very narrow decision by the court that doesn't really have any continuing applicability," Weissman said. "We don't think it has any meaningful impact on public sector collective bargaining."
Peter Verniero, the former state Supreme Court Justice and state Attorney General, called it "a significant opinion for a number of reasons, not least of which because there aren't many recent decisions of the high court pertaining specifically to layoffs in a municipal setting."
But Verniero, now an attorney with Newark law firm Sills Cummis & Gross, said "it is too early to predict whether the reach of the decision will extend beyond periods of municipal fiscal distress."