Unions Win Court Decision On Payment
of Salary Increments (Steps)
Governor Christie Likely to Appeal

3-12-2016

On March 9, 2016, the NJ Superior Court overturned two Public Employment Relations Commission (PERC) decisions that froze the payment of salary increments after the expiration of a contract and declared that the non-payment of salary increments could not be challenged at arbitration. These cases arose at the county and local government levels, but applied equally to State employees.

As you may know, all State employee contracts expired on June 30, 2015, and since then the State, based on the PERC decisions, has refused to pay normal salary increments (steps).

The NJ Superior Court’s ruling gives us the opportunity to resurrect this issue. Our attorney, acting on our behalf, has written to the Office of Employee Relations (OER) demanding that all salary increments be paid retroactive to the expiration the contract and advising that a refusal to do so will result in legal action to enforce our claim.  The claim may be the form of an unfair practice charge at PERC and/or a grievance under Article XXI D of the expired Agreement.  

The legal issue at stake is known as the “dynamic status quo,” a precedent that held sway for decades that viewed the payment of normal salary increments as a term and condition of employment that could not be unilaterally discontinued upon the expiration of a collective negotiations agreement. The PERC rulings reversed that precedent by substituting the “static status quo” doctrine holding that the obligation to pay normal salary increments does not survive the expiration of a collective negotiations agreement.  In reversing this longstanding precedent, PERC took into account legislative caps on property taxes and other fiscal restraints.  However, the Superior Court ruled that PERC exceeded its authority under the NJ Employer Employee Relations Act.  Only the State legislature, it held, can affect the payment of normal increments.

The Council hopes that the State will comply with the Superior Court decision, but it appears more likely that PERC will file a petition seeking NJ Supreme Court review. It will then be up to the Court to either allow the lower court decision to stand or to hear the case.  

To read the court decision for yourself, go to: http://www.judiciary.state.nj.us/opinions/a2477-13a0107-14.pdf