In the Matter of Perth Amboy Layoffs Docket No. 2007-1646 (Commissioner of Personnel, decided November 13, 2006) The Professional Firefighters Association of New Jersey (fire union), represented by Raymond G. Heineman, Jr., Esq., and the Policemen s Benevolent Association Local 13 (police union), represented by Stephen B. Hunter, Esq., petition the Commissioner of Personnel (Commissioner) for a stay of the layoff of fire and police personnel in the City of Perth Amboy (City). By way of background, on October 6, 2006, the City submitted a layoff plan to the Department of Personnel (DOP), proposing the layoff of two Police Officers, six Police Officers, Bilingual in Spanish and English, 11 Fire Fighters, and one Fire Fighter, Bilingual in Spanish and English, effective November 15, 2006. The City s layoff plan detailed actions it took, pursuant to N.J.A.C. 4A:8-1.2, to lessen the possibility of layoffs, including implementing a hiring freeze, instituting a budget freeze or reductions where permitted by law and contract, and applying to the Department of Community Affairs for $1.5 million in Extraordinary State Aid. Despite the above measures, the City reported that its residents are still faced with a local property tax increase of $2,833,228.77, due to budget shortfalls. The City also indicated that it met with officials of the Perth Amboy Firefighters Association on September 25, 2006 and with officials of the Perth Amboy Policemen s Benevolent Association on September 26, 2006 to advise them of the proposed layoffs. In addition, the City met with all employees affected by the possible layoffs, along with their union representatives and legal counsel. At this meeting, employees were invited to review the City s proposed budget and offer constructive alternatives to the proposed layoffs, and representatives from the DOP and the Division of Pensions and Benefits were present to answer inquiries. The DOP reviewed and approved the City s layoff plan on October 13, 2006 1 ; however, the effective date of the layoff was changed to November 30, 2006 in order that affected employees could receive the required 45 days notice of the layoff in accordance with N.J.A.C. 4A:8-1.6(a). In the instant petition for a stay, the fire union contends that the City s layoff of fire service personnel was proposed in bad faith. The fire union notes that the collective bargaining agreement between the City and the fire union expired on December 31, 2004. On November 14, 2005, the fire union filed for interest arbitration with the Public Employment Relations 1 The DOP waived the provisions of N.J.A.C. 4A:8-1.4(a), requiring submission of the layoff plan 30 days prior to the issuance of layoff notices.
Commission (PERC), and an arbitrator was appointed to assist the parties to reach a tentative contract settlement. The fire union asserts that a settlement was reached by the parties on August 23, 2006, subject to the approval of City Council and the fire union s membership. On September 18, 2006, the fire union s membership ratified the agreement, and this ratification was communicated to the City on September 25, 2006. On that same date, the fire union notes that the City announced the proposed layoff of fire service personnel and that such action was under consideration for at least 30 days prior to that date. The fire union emphasizes that the City s bad faith is demonstrated by the fact that it failed to suggest that budgetary shortfalls would necessitate layoffs at any time during contract negotiations. The fire union underscores that such knowledge would have had a significant impact on the mediation and interest arbitration if it had been presented prior to the mediated settlement. 2 Moreover, the fire union avers that, on October 12, 2006, the City Council President publicly proposed that the fire union s membership agree to waive retroactive salary increases and their 2007 4% salary increase, which are part of the negotiated settlement. The fire union suggests that the foregoing indicates that the City s proposed layoff plan is an attempt to avoid its obligations under the negotiated agreement and economic retaliation by the City to bully its membership. Further, the fire union argues that the appropriate consultations between it and the City did not occur. The fire union claims that, at the September 25, 2006 meeting, referenced in the layoff plan, it was not provided with an opportunity to discuss alternatives to the layoff or review potential cost savings in order to avoid the necessity of the layoff. It also asserts that it requested numerous documents to prepare for an October 23, 2006 meeting with the City to discuss possible alternatives to the layoff. While a discussion took place on that date, the fire union emphasizes that the requested information, which included information regarding the City s total payroll costs, the anticipated savings to be achieved by the layoff, and information regarding mutual aid response, has not yet been produced. Thus, it contends that it has not yet had an opportunity to provide any meaningful input regarding alternatives to the proposed layoff or areas for potential cost saving or revenue production. With regard to the factors set forth in N.J.A.C. 4A:2-1.2, the fire union maintains it has a clear likelihood of success in setting aside the layoffs, based on the failure of the City to consult with it prior to the layoff and the City s alleged bad faith motives for implementing a layoff of fire service personnel. It also argues that there is a danger of immediate or irreparable harm to the public if the layoff proceeds as planned. Specifically, the fire 2 It should be noted that these issues are also the subject of an Unfair Practice Charge filed with PERC.
union asserts that there are currently 44 Fire Fighters; thus, the layoff plan will result in a reduction in force of approximately 25%. The fire union argues that such a decrease in manpower creates an immediate risk to the health and safety of the citizens of Perth Amboy and surrounding communities. In support of its arguments, the fire union relies on a 1997 study of the staffing levels of the City s Fire Department, which recommended that safe staffing levels required 12 Fire Fighters per shift. The fire union claims that the City currently assigns 11 Fire Fighters per shift, and the proposed reduction in force will decrease staffing levels to eight Fire Fighters per shift. The fire union notes that staffing levels are also below current national standards, which call for 16 Fire Fighters per shift. It also emphasizes that, since the issuance of the 1997 report, two residential communities have been constructed in the City, adding a total of 3,100 housing units. In addition, the fire union notes that the City has added additional emergency response services, including a marine unit serving Middlesex County and New York harbor, which is funded by Federal Homeland Security. Finally, the fire union provides figures regarding the provision of services pursuant to mutual aid agreements with surrounding communities, such as Woodbridge and South Amboy. Specifically, from January 1, 2004 through October 31, 2006, the City has received mutual aid from surrounding Fire Departments 105 times, and it has provided mutual aid 65 times. Thus, the fire union contends that the proposed layoff will also harm surrounding communities through an increased reliance on the receipt of mutual aid. Further, the fire union argues that there will be no substantial injury to the City if the layoff is stayed. It underscores that the City has not reduced spending in any other City Departments, and it has not explored the utilization of available Urban Enterprise Zone funding. The fire union also suggests that the City could request the aid of the Department of Community Affairs to identify areas of additional savings, and it has not applied for State Aid to Distressed Cities. The police union argues that the City failed to provide adequate notice regarding the proposed layoff, and it has neglected to consider any viable alternatives to the layoff. The police union indicates that it first learned of the proposed layoff through the media, despite the fact that the City was required to consult with the affected unions prior to offering alternatives to the layoff or initiating pre-layoff actions. The police union emphasizes that, to date, the City has failed to engage in any form of dialogue with it to address these issues, in violation of Merit System law and rules. In addition, it argues that it is unacceptable for the City to limit its proposed layoff to public safety personnel without examining whether comparable savings can be achieved through instituting layoffs of civilian employees. The police
union also claims that there are numerous temporary, provisional and unclassified employees currently working for the City, and it avers that such employees should be separated from employment prior to instituting the layoff of public safety personnel. In particular, the police union asserts that there are three Special Police Officers and numerous Auxiliary Police employed by the City, whose employment should be terminated prior to the layoff of any permanent Police Officers, and it contends that the City has refused to release information to the police union regarding such employees. Finally, the police union argues that the City s Police Department is already understaffed, and the layoff of eight Police Officers will negatively impact the health and safety of the City s residents. In response, the City, represented by Rodney T. Hara, Esq., argues that its layoff plan complied with the requirements of N.J.A.C. 4A:8-1.4(a) and was appropriately approved by the DOP. It contends that the allegations presented by the fire union regarding the timing of the submission of the layoff plan are the subject of a pending matter before PERC and, if the fire union is successful in that matter, PERC will fashion the appropriate remedy. The City maintains that its proposed layoff is necessary to achieve economy and efficiency, since it is seeking to limit the property tax increase imposed on its residents to 8.9%. The City notes that its residents suffered a 47.25% property tax increase in the previous year. The City also maintains that it invited suggestions from the affected bargaining units for alternatives to the proposed layoff, and it continues to communicate with the unions on this topic. With regard to the fire union s allegations of bad faith, the City asserts that the possibility of a reduction in force was not discussed during negotiations with the fire union because layoffs are a nonnegotiable managerial prerogative, and the consultations required by Merit System law and rules do not equate to negotiations. The City also underscores that the parties met with the PERC arbitrator on October 25, 2006 to explore alternatives to the proposed layoff. The arbitrator fashioned a proposed alternative, which was ultimately rejected by the fire union. As to the fire union s assertion that the public will be irreparably harmed by the proposed reduction in force, the City counters that it also utilizes a team of volunteer fire personnel, comprised of one Assistant Chief, one Training Officer, 36 Fire Fighters, 13 Fire Police, and 12 support personnel. It also emphasizes that its response to fires is supplemented by mutual aid assistance from Woodbridge, South Amboy, and Sayreville. Moreover, the City contends that, [d]ue to improved code enforcement and inspection, the number of building fires in 2004 and 2005 [was] only thirtyseven. Additionally, the City claims that it will be substantially harmed if the requested relief is granted, since revenue is not available to fund the salaries of the Fire Fighters to be laid off. Finally, the City argues that the
public interest is best served by limiting property tax increases, and it emphasizes that its proposal will not compromise the safety of its residents. With regard to the arguments presented by the police union, the City initially notes that it presented the police union with a proposed agreement implementing a wage freeze, which would reduce the impact of the layoff. The police union is currently reviewing the agreement, which must be ratified by its membership. As to the scope of the layoff, the City asserts that, since 1990, staffing levels of the Police and Fire Departments have increased by 23 and 8, respectively. In contrast, the staffing levels of other City departments have remained stable or decreased during the same time frame. The City also underscores that the average salary of its Police Officers is $73,696, and the average salary of its Fire Fighters is $66,080; its general civilian employees earn an average salary of $47,231. Thus, the City argues that it was appropriate to target these two departments when it sought to achieve measurable savings. Moreover, while the City does not dispute that it employs two Special Police Officers and 23 auxiliary Police Officers, it contends that discontinuing the employment of these individuals would not result in any substantial savings. In this regard, the City claims that, in the first six months of 2006, its Special Police Officers made a total of $11,445, and, for the 12-month period ending on October 31, 2006, it expended $29,157.75 on its auxiliary force. The City avers that [t]he cost of the services of the auxiliary and special police officers would be less than the salary and benefits for one police officer. Further, the City argues that the police union has suggested several alternatives to the proposed layoff, but it generally concludes that the suggested alternatives would not produce significant savings. Finally, in response to the police union s contention that public safety will be negatively impacted by the proposed reduction in force, the City notes that it recently lost $500,000 in State funding, which was used to finance its community policing unit. As a result, the City indicates that it plans to eliminate this unit and reassign the 12 Police Officers who staff the unit to the Patrol Division. Therefore, the City asserts that it will be able to maintain the required staffing levels on each shift after the layoff of eight Police Officers. CONCLUSION Initially, both unions are requesting a stay of the proposed layoff, pending the outcome of their unfair labor practice charges, currently pending before PERC. However, it would not be appropriate to address these issues in this forum, as the Chairman of PERC has the authority to hear and decide petitions for interim relief in unfair practice proceedings. See N.J.A.C. 19:14-9.1, et seq. Nevertheless, the instant requests can be addressed in accordance with the provisions of Merit System law and regulations.
N.J.A.C. 4A:2-1.2(c) provides the following factors for consideration in evaluating petitions for interim relief: 1. Clear likelihood of success on the merits by the petitioner; 2. Danger of immediate or irreparable harm; 3. Absence of substantial injury to other parties; and 4. The public interest. N.J.S.A. 11A:8-4 and N.J.A.C. 4A:8-2.6(a)1 provide that good faith appeals may be filed based on a claim that the appointing authority laid off or demoted the employee in lieu of layoff for reasons other than economy, efficiency or other related reasons. When a municipality has abolished a position, there is a presumption of good faith and the burden is on the employee to show bad faith and that the action taken was not for purposes of economy. Greco v. Smith, 40 N.J. Super. 182 (App. Div. 1956); Schnipper v. North Bergen Township, 13 N.J. Super. 11 (App. Div. 1951). As the Appellate Division further observed, That there are considerations other than economy in the abolition of an office or position is of no consequence, if, in fact, the office or position is unnecessary, and can be abolished without impairing departmental efficiency. Schnipper, supra at 15. (emphasis added). Further, N.J.S.A. 11A:8-2(b), N.J.A.C. 4A:8-1.2(e) and N.J.A.C. 4A:8-1.3(c) provide that appointing authorities shall consult with affected negotiations representatives prior to offering alternatives to layoffs or implementing pre-layoff measures. N.J.S.A. 11A:8-3 and N.J.A.C. 4A:8-1.2(b) and (c) provide that appointing authorities should lessen the possibility of layoffs by considering voluntary alternatives, such as granting leaves of absence without pay to permanent employees without loss of seniority, granting voluntary furloughs, allowing a voluntary reduction of work hours, or providing employees with optional demotional title changes. N.J.S.A. 11A:8-2 and N.J.A.C. 4A:8-1.3(a) provide that an appointing authority shall lessen the possibility, extent or impact of layoffs by implementing pre-layoff actions, such as initiating a temporary hiring and/or promotion freeze, separating non-permanent employees, returning provisional employees to their permanent titles, reassigning employees, or assisting potentially affected employees in securing transfers or other employment. In the instant matter, there is a dispute in the record regarding the good faith of the proposed layoff. The fire union contends that the proposed layoff is merely an attempt by the City to pressure its members into waiving salary increases contained in the collective bargaining agreement. It argues that the City s inability to abide by the terms of the recently negotiated agreement should have been brought to its attention during the bargaining
process. Although the timing of the City s determination that a layoff was necessary is suspect, the City presents valid economic reasons for the proposed layoff. Specifically, the City argues that it is seeking to alleviate the property tax burden on its citizens by limiting its increase in property taxes this year to 8.9%. As to the additional factors set forth in N.J.A.C. 4A:2-1.2(c), both unions have presented significant public safety concerns. It is emphasized that the proposed layoff is limited to the Police and Fire Departments in the City, and no information has been presented regarding potential savings that could be achieved within other City departments. The City also has not detailed how much property taxes would increase in the event that the layoff of public safety personnel does not occur. However, these issues are best resolved following a full hearing regarding the good faith of the City s proposed layoff, and such a determination cannot be made on the current written record. Nevertheless, the fire union has raised serious concerns regarding the extent of the consultations between the City and the fire union regarding the subject reduction in force. The fire union avers that it met with City officials on September 25, 2006, at which time it was merely notified of the proposed layoff, but it had no opportunity to discuss possible alternatives to layoff or to discern the pre-layoff actions taken by the City. The fire union also indicates that no information was provided regarding the savings that would be achieved by the proposed layoff nor was it provided the opportunity to review other sources of savings or revenue production within the City to lessen the possibility or extent of layoffs. Although the fire union also met with the City on October 23, 2006 to engage in further discussions, it asserts that it was not provided with pertinent information, such as payroll costs, anticipated savings to be achieved by the layoff, and information regarding mutual aid response, in order to engage in any meaningful discussion at that time. Similarly, the police union argues that the City made no attempt to consult with it to discuss voluntary alternatives to the layoff or possible prelayoff actions that could be taken to obviate the need for a reduction in force. Significantly, the police union alleges that the City employs several Special Police Officers and Auxiliary Police staff that should be terminated to effectuate savings prior to terminating permanent Police Officers. The police union avers that the City has not terminated these and other temporary, provisional and unclassified employees within the proposed layoff units, and it suggests that the termination of these employees would reduce the impact of the proposed layoff of permanent public safety employees. The City counters that its obligation to consult with the unions does not require negotiation. While the City correctly argues that the level of consultation contemplated by Merit System law and rules governing layoffs
does not require negotiations with affected collective bargaining units as that term is used in labor relations law, it does require more than mere notification of impending layoffs. Merit System law and rules contemplate that a meaningful discussion will occur between an appointing authority and affected negotiations representatives with a view toward avoiding a reduction in force altogether or lessening the impact of a proposed layoff on permanent employees and the provision of public services. In this regard, the City does not dispute the fire union s assertion that pertinent information was not provided prior to or during the two meetings between the parties, and it does not dispute the representations of both affected unions that the unions were first notified of the impending layoffs in late September 2006, approximately two weeks prior to submission of the layoff plan to the DOP. In the absence of information, particularly that regarding payroll costs, anticipated savings, and the number of temporary, provisional, or unclassified employees in the layoff units, it is, indeed, difficult for a bargaining representative to offer constructive input regarding potential alternatives to layoffs or pre-layoff actions that could avoid the need for or lessen the impact of a reduction in force. It must also be emphasized that the City also has not provided this information in connection with the instant matter. In light of the serious concerns that have been raised regarding the required consultations, or lack thereof, with the affected negotiations representatives, it is appropriate to stay the subject reduction in force for a period of 45 days. During this time period, the parties are directed to exchange information necessary to engage in a meaningful discussion regarding possible alternatives to the layoff and pre-layoff actions that could achieve the necessary cost savings to the City while avoiding entirely or lessening the impact of the layoff on permanent public safety employees. The City is also strongly encouraged to independently explore viable alternatives to the layoff of permanent public safety employees. Therefore, the effective date of the layoff, if still necessary after appropriate consultations, will be amended to January 14, 2007. ORDER Therefore, I have ordered that the layoff of fire and police personnel in the City of Perth Amboy, originally scheduled for November 30, 2006, be temporarily stayed until January 14, 2007. I have also ordered that the City of Perth Amboy engage in good faith consultations with the Professional Firefighters Association of New Jersey and the Policemen s Benevolent Association Local 13 regarding possible alternatives to layoff and pre-layoff actions.