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D.U.P. No. 2021-2
Synopsis:
The Director of Unfair Practices dismisses an unfair practice charge filed by the Ridgefield Park Administrators Association (Administrators Association) against the Ridgefield Park Board of Education (Board). The Association alleged the Board violated sections 5.4a(5) and (1) of the Act by unilaterally increasing unit employees health insurance contributions from 1.5% of base salaries to Tier 4 rates under P.L. 2011, c. 78 (Chapter 78) . The Director disagreed, holding that the change to Tier 4 contributions preserved the status quo under the unilateral change doctrine and was in compliance with Chapter 78.
PERC Citation:
D.U.P. No. 2021-2, 47 NJPER 207 (¶46 2020)
Appellate History:
Additional:
Miscellaneous:
NJPER Index:
9.232 15.11 43.131 72.611 72.664
Issues:
D.U.P. NO. 2021-2 1.
D.U.P. NO. 2021-2
STATE OF NEW JERSEY
PUBLIC EMPLOYMENT RELATIONS COMMISSION
BEFORE THE DIRECTOR OF UNFAIR PRACTICES
In the Matter of
RIDGEFIELD PARK BOARD OF EDUCATION,
Respondent,
-and- Docket No. CO-2018-099
RIDGEFIELD PARK ADMINISTRATORS ASSOCIATION,
Charging Party.
SYNOPSIS
The Director of Unfair Practices dismisses an unfair practice charge filed by the Ridgefield Park Administrators Association (Administrators Association) against the Ridgefield Park Board of Education (Board). The Association alleged the Board violated sections 5.4a(5) and (1) of the Act by unilaterally increasing unit employees health insurance contributions from 1.5% of base salaries to Tier 4 rates under P.L. 2011, c. 78 (Chapter 78) . The Director disagreed, holding that the change to Tier 4 contributions preserved the status quo under the unilateral change doctrine and was in compliance with Chapter 78.
D.U.P. NO. 2021-2
STATE OF NEW JERSEY
PUBLIC EMPLOYMENT RELATIONS COMMISSION
BEFORE THE DIRECTOR OF UNFAIR PRACTICES
In the Matter of
RIDGEFIELD PARK BOARD OF EDUCATION,
Respondent,
-and- Docket No. CO-2018-099
RIDGEFIELD PARK ADMINISTRATORS ASSOCIATION,
Charging Party.
Appearances:
For the Respondent,
Porzio, Bromberg & Newman, P.C., attorneys,
(Kerri A. Wright, of counsel)
For the Charging Party,
Schwartz Law Group, LLC, attorneys
(Andrew L. Schwartz, of counsel)
REFUSAL TO ISSUE COMPLAINT
On October 23, 2017, the Ridgefield Park Administrators Association (Administrators Association) filed an unfair practice charge against the Ridgefield Park Board of Education (Board). The charge alleges that the Board violated section 5.4a(1),(3) and (5)1/ of the New Jersey Employer-Employee Relations Act (Act) by unilaterally increasing unit employees = contributions towards health insurance premiums. Specifically, the Administrators Association alleges that the Board, effective in the January 13, 2017 pay period, unilaterally increased unit employees = health insurance contributions from 1.5% of their base salaries to the 4th Tier level contribution rate under P.L. 2011, c. 78 (Chapter 78).2/
On April 20 and May 2, 2018, the Administrators Association and Board filed briefs addressing whether a complaint should issue on the Administrators Association = s charge. In or around June, 2018, the Administrators Association requested that the charge be held in abeyance pending the outcome of a related appeal of a scope of negotiations determination by the Public Employment Relations Commission (Commission) involving the Ridgefield Park Education Association (Education Association) and the Board.3/
In the Education Association case, the Commission held Chapter 78 preempted negotiations over a multi-year collective negotiations agreement that would reduce health insurance contributions to 1.5% of unit employees = base salaries when unit employees reached Chapter 78, Tier 4 contributions in the first year of the multi-year agreement. Ridgfield Park Bd. of Ed., P.E.R.C. No. 2018-14, 44 NJPER 167 ( & 49 2017). The Education Association and Board were parties to a collective negotiations agreement extending from July 1, 2014 through June 30, 2018. While the 2014-2018 agreement contained a provision that provided unit employees would contribute 1.5% of their base salaries to health insurance premiums, the Education Association and Board agreed that unit employees were required to make Tier 4 contributions during the first year of that agreement, or the 2014-2015 contract year. The dispute between the parties arose over whether the 1.5% provision was enforceable for the remaining three years of the 2014-2018 agreement: the Association contended it was, the Board countered it was not. The Board also argued that reduction of health insurance contributions only became mandatorily negotiable under Chapter 78 for the agreement succeeding the 2014-2018 agreement. The Commission agreed with the Board and held Chapter 78 preempted the 1.5% provision. 44 NJPER 167.
On May 3, 2019, the Appellate Division reversed the Commission. In re Ridgfield Park Bd. of Ed., 459 N.J. Super. 57 (App. Div. 2019). The Board appealed. On August 17, 2020, the Supreme Court reversed the Appellate Division decision and upheld the Commission = s decision. In re Ridgefield Park Bd. of Ed., 2020 N.J. LEXIS 902. The Supreme Court held that unit employees were required to make Tier 4 contributions for the duration of their 2014-2018 agreement and that reductions to Tier 4 contributions could only be negotiated under Chapter 78 for the successor agreement to the 2014-2018 agreement. The Court also noted that until the parties agreed to a reduction of the Tier 4 contributions, Tier 4 contributions would remain the A status quo @ for future negotiations under Chapter 78. 2020 N.J. LEXIS 902, *29-30.
The Commission has authority to issue a complaint where it appears that a charging party = s allegations, if true, may constitute an unfair practice within the meaning of the Act. N.J.S.A. 34:13A-5.4c; N.J.A.C. 19:14-2.1. The Commission has delegated that authority to me. Where the complaint issuance standard has not been met, I may decline to issue a complaint. N.J.A.C. 19:14-2.3; CWA Local 1040, D.U.P. No. 2011-9, 38 NJPER 93 ( & 20 2011), aff = d, P.E.R.C. No. 2012-55, 38 NJPER 356 ( & 120 2012).
I find the following facts.
The Administrators Association is the exclusive majority representative of elementary and high school principals and assistant principals, the athletic director and the director of special services. The Administrators Association and Board were parties to a collective negotiations agreement extending from July 1, 2015 through June 30, 2018 (2015-2018 Agreement). The parties have since entered into a successor agreement extending from July 1, 2018 through June 30, 2021 (2018-2021 Agreement).
The 2015-2018 Agreement is silent as to how much unit employees must contribute towards health insurance premiums. As alleged in the charge, the 2015-2018 Agreement A . . . does not contain language as to the Chapter 78 health benefit contribution @ and this was also true of the 2012-2015 predecessor collective negotiations agreement between the Administrators Association and Board. According to the Administrators Association, the reason these agreements were silent on health insurance contributions was A . . . because the Administrators Association always received the same benefit package as that of the teachers [education association]. @ (Administrators Association = s Charge).
Article III of the 2015-2018 Agreement defines the negotiation procedures for reaching a collective agreement. It provides, in pertinent part:
A. The Board and the Association agree to enter into negotiations over a successor agreement in accordance with the rules and regulations of the Public Employment Relations Commission. At that time the Association agrees to present to the Board its proposals for modifications to be included in the successor agreement. Each party shall be free to propose and negotiate with regard to all appropriate subjects which it desires to place before the other for consideration. Any agreement so negotiated shall incorporate all rights and obligations assumed by each party and to reflect the complete and final understanding on all matters covered by this negotiated agreement. Such agreement shall apply to all members of the negotiating unit, and shall be reduced to writing and after ratification, signed by all parties.
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D. During its term this agreement shall not be modified in whole or in part by the parties, except by mutual agreement to reopen for negotiations as by a written amendment duly executed by both parties.
The 2015-2018 Agreement also has a A zipper @ clause. Article XV, entitled A Fully Bargained Agreement @ , provides, in pertinent part:
A. This agreement represents and incorporates the complete and final understanding and settlement by the parties of all negotiated matters. During the term of this Agreement, neither party will be required to negotiate with respect to any such matter.
[emphasis added]
The 2012-2015 and 2018-2021 Agreements contain the same negotiations procedures and zipper clauses. In a section entitled A Fringe Benefits @ in the 2018-2021 Agreement, the parties agreed to the following on health insurance contributions:
B. Association members = health insurance contributions are to be the amount as decided by the Public Employment Relations Commission ( A PERC @ ) through the Unfair Labor Practice having Docket No. CO-2018-099 or, if appealed, by a final judgment of a court of appropriate jurisdiction. Specifically, if PERC (or, if appealed, the final judgment of a court of appropriate jurisdiction) decides that the Board committed an unfair labor practice by moving Association members to Tier IV contribution levels under P.L. 2011 c. 78 ( A Chapter 78 @ ) and order the Board to move the members to the prior 1.5% contribution level retroactive to the date of the change giving rise to the PERC matter, the Board will abide by the order and make retroactive reimbursement, and 1.5% will become the contracted language and the baseline for future negotiations. If PERC decides that the Board did not commit an unfair labor practice, then Tier IV will be the contracted language and the baseline for future negotiations.
Apart from this language, the 2018-2021 CNA is silent about the amount of contributions unit employees must make towards health insurance premiums.
By letter dated January 3, 2017, Eric W. Koenig, the Ridgefield Park School District = s (District) Superintendent of Schools, notified administrators that the Board A . . . recently learned that due to an administrative oversight, members of the Ridgefield Park Administrators = Association have not been making health care contributions in accordance with P.L. 2011, c. 78 ( A Chapter 78 @ ). @ Koenig goes on to write that A . . . this error will be corrected immediately @ and further explains the Board = s rationale for adjusting the contributions pursuant to Chapter 78:
As you are likely aware, Chapter 78 requires all local board of education employees to make established contributions toward the cost of their health care benefits. Chapter 78 further requires that its A contribution levels shall become part of the parties = collective negotiations @ and remain the status quo until the parties negotiate differently. The current agreement between the Board and Administrators = Association reflects the parties did not negotiate a different contribution level. Therefore, the contribution levels set forth in Chapter 78 remain a part of the parties = Agreement and employees are mandated to contribute in accordance with its provisions.
The January 3rd letter also references N.J.S.A. 18A:16-17.2 and the Commission decision in Clementon Bd. of Ed., P.E.R.C. No. 2016-10, 42 NJPER 117 ( & 34 2015), dism'd as moot, 43 NJPER 125 ( & 38 App. Div. 2016), in support of the Board = s position. In Clementon, the Commission held that Chapter 78 preempted negotiations over reductions to Chapter 78 health insurance contributions during the term of a multi-year agreement in which the parties reach Tier 4 level contributions. Clementon, 42 NJPER 117; Ridgefield Park, 2020 N.J. LEXIS 902, *16. The Clementon Education Association appealed the Commission = s decision and on September 30, 2016, the Appellate Division dismissed the appeal as moot. 43 NJPER 125.
The Administrators Association alleges that prior to the Board = s January 2017 adjustment to health insurance contributions, association members A . . . had paid a 1.5% contribution level for the prior 18 months . . . . @ The Administrators Association also asserts that A . . . for at least the last five contracts, the past practice has been that the Administrator = s Association contributes at the same level negotiated by the Education Association. @ (April 20, 2018 Position Statement). These factual circumstances are similar to what occurred in the Education Association case. There, during the 2015-2016 contract year of the 2014-2018 Education Association Agreement, the A . . . Association = s members contributed only 1.5% of their salaries to the cost of their health care @ until, several months later, the Board increased unit employees contributions in accordance with Chapter 78. 2020 N.J. LEXIS 902, *16. ANALYSIS The Administrators Association contends that the Board violated the Act by increasing unit employees = health insurance contributions from 1.5% of their base salaries to Tier 4 levels under Chapter 78. According to the Association, since the Education Association had negotiated a 1.5% contribution rate in their 2014-2018 Agreement, the Administrators Association = s unit employees should only contribute 1.5% of their base salaries towards health benefits A . . . because the past practice has been that the Administrators Association contributes at the same level negotiated by the Education Association. @ (Page 2 of Association = s 4/20/18 Position Statement).
Moreover, the Administrators Association argues that the fact that the Supreme Court held that the 1.5% provision in the 2014-2018 Education Association Agreement was preempted and unenforceable under Chapter 78 has no bearing on this case. According to the Administrators Association, the preemption analysis that would apply to the Education Association = s 2014- 2018 agreement does not apply here because, unlike the Education Association, the Administrators Association reached Tier 4 prior to entering into the 2015-2018 Agreement with the Board. In other words, the Administrators Association A . . . should not be forced to contribute at the 35% Fourth Tier rate merely because the Education Association must so contribute, if the exclusive basis for such a contribution rate is because of case-law [Clementon and Ridgefield Park] that is inapplicable to the circumstance of the Administrators Association. @ (Page 3 of Association = s 4/20/18 Position Statement).
The Board disagrees with the Association and argues, A Chapter 78 requires that Tier 4 contributions remain the status quo until the parties contractually agree to reduce the statutory health insurance contributions. @ (Page 1 of Board = s 4/20/18 Position Statement). @ The Board further contends that the Board and Administrators Association did not agree to reduce Chapter 78 contributions and, citing N.J.S.A. 18A:16-17.2, maintains that Chapter 78 A . . . mandates that full premium share contributions remain in the parties = collective bargaining agreement @ until the parties collectively negotiate a reduction. (Page 2 of Board = s 4/20/18 Position Statement). According to the Board, the parties entered into a collective negotiations agreement in 2015 that made A only two substantive contractual changes @ to the 2012-2015 predecessor agreement: (1) provision to unit members of a A significantly greater salary increase than compared to previous contracts @ and (2) a reduction in the number of vacation days. (Page 2 of Board = s 4/20/18 Position Statement). Aside from these changes, the Board and Association did not agree to modifications of the 2012-2015 collective agreement and the 2012-2015, 2015- 2018 and 2018-2021 agreements do not reduce health insurance contributions to 1.5% of base salaries.4/
In its May 2, 2018 reply to the Board = s April 20 brief, the Administrators Association A . . . submits that testimony in the context of a hearing is required to determine what actually occurred to cause the Board to unilaterally change and alter the Association = s duly negotiated health benefits contribution levels following full implementation at Chapter 78 = s Tier Four. @ (Page 2 of Association = s 5/2/18 Brief). The Association further contends A . . . that it negotiated the same 1.5% contribution rate the Education Association negotiated @ but does not dispute that the 2015-2018 agreement does not set forth such a provision and does not dispute the Board = s assertion that the parties only agreed to two substantive contractual changes to the 2012-2015 agreement, both of which do not address health insurance contributions.
For the reasons explained below, I agree with the Board and find that it did not violate the Act. The Board, in adjusting health insurance contributions in January 2017, complied with Chapter 78 in accordance with Commission and judicial precedent. Ridgefield Park, 2020 N.J. LEXIS 902; Lacey Tp., P.E.R.C. No. 2020-47, 46 NJPER 447 ( & 101 2020). Moreover, the January 2017 adjustment was not a unilateral change to the status quo concerning health benefits for administrators, but preserved the status quo as defined by Chapter 78 and the past practice alleged in this case.
Under Chapter 78, when negotiating a collective negotiations agreement after reaching Tier 4 contributions, parties A . . . shall conduct negotiations concerning contributions for health care benefits as if the full premium share was included in the prior contract @ and A after full implementation, those contribution levels shall become part of the parties = collective negotiations and shall then be subject to collective negotiations in a manner similar to other negotiable items between the parties. @ N.J.S.A. 18A:16-17.2. The Supreme Court of New Jersey and Commission have construed this statute as defining the status quo for health benefit contributions at Tier 4 levels until the parties agree in a collective negotiations agreement to change Tier 4 contributions. In re Ridgefield Park Bd. of Ed., 2020 N.J. LEXIS 902; Lacey Tp., P.E.R.C. No. 2020-47, 46 NJPER 447 ( & 101 2020). As the Supreme Court explained in Ridgefield Park:
We recognize a legitimate argument that N.J.S.A. 18A:16-17.2 makes clear that when employees reach the Tier 4 contribution level in the first year of a CNA they must continue to contribute at that level until they negotiate a successor CNA providing for a lower rate of contribution, and that successor CNA goes into effect. When the statutory language is considered in conjunction with Chapter 78 = s purpose and legislative history, that legislative intent is plain.
[2020 N.J. LEXIS 902, *9-10][emphasis added]
The Supreme Court would go on to note that A . . . nothing in the statute [Chapter 78] authorizes an immediate reduction of employee health care contribution rates to their pre-Chapter 78 levels @ and that A . . . Tier 4 contribution levels are to remain in effect unless and until the parties negotiate lower health insurance premium contribution rates in the next CNA. @ 2020 N.J. LEXIS 902, *30. According to the Court, this interpretation of N.J.S.A. 18A:16-17.2 is consonant with the Legislature = s intent in enacting Chapter 78 that health insurance contributions would increase A over the long term @ and not represent only a A transient increase @ in contributions followed A . . . by an immediate reversion to pre-statute contribution rates as soon as employees had contributed at the Tier 4 level for a year. @ 2020 N.J. LEXIS 902, *35.
Consistent with the Supreme Court = s opinion in Ridgefield Park, the Commission in Lacey Township held that Chapter 78 preempted arbitration over a grievance seeking to enforce a 1.5% contract provision immediately after reaching Tier 4 contributions during successor contract negotiations. There, Teamsters Local 97 (Teamsters) and the Township of Lacey (Township) were parties to a collective negotiations agreement extending from July 1, 2016 through June 30, 2018 (Agreement). Article XV(J) of the Agreement provided that A . . . employees will be required to contribute one and a half percent (1.5%) of their salary toward health coverage. @ Lacey Tp., p. 2 of Slip Op. Unit employees reached Tier 4 contributions in July 2017 and achieved full implementation of Chapter 78 tiered contributions by July 2018. Lacey Tp., p. 4 of Slip Op. During negotiations for a successor agreement, the Teamsters filed a grievance alleging the Township violated Article XV(J) of the Agreement by continuing to deduct Tier 4 contributions after unit employees achieved full implementation of Chapter 78 contributions in July 2018. The Commission disagreed and restrained arbitration of the grievance, holding that the status quo for negotiations remained Tier 4 contributions under Chapter 78 until the parties collectively negotiated a successor agreement that altered Tier 4 contributions. The Commission explained:
The plain, unambiguous language of N.J.S.A. 40A:10-21.2 made the Tier Four contribution levels following full implementation of Chapter 78 the starting point for the pending negotiations absent any agreement to the contrary. Health care coverage contributions are negotiable in the successor CNA, but until that contract is reached, arbitration over the status quo ante is preempted. Accordingly, we restrain arbitration.
[Lacey Tp., p. 10 of Slip Op.]
Here, after reaching Tier 4 in the last year of the 2012- 2015 Agreement, the Administrators Association did not enter into a successor collective negotiations agreement with the Board to reduce Tier 4 contributions. The 2015-2018 and 2018-2021 agreements are silent as to what amount Chapter 78 contributions should be reduced. Absent such agreement, Tier 4 contributions remain the status quo and are effectively incorporated as part of the current collective negotiations agreement between the Administrators Association and Board. See State v. State Supervisory Employees Association, 78 N.J. 54, 80 (1978) (Supreme Court explains that statutes A . . . which are applicable to employees who comprise a particular unit are effectively incorporated by reference as terms of any collective agreement covering that unit @ ); Ewing Tp., P.E.R.C. No. 83-165, 9 NJPER 400 ( & 14182 1983); N.J.S.A. 18A:16-17.2.
The Board = s adjustment of health insurance contributions to Tier 4 levels was also consistent with the unilateral change doctrine. N.J.S.A. 34:13A-5.3; State of New Jersey (Corrections), H.E. No. 2020-2, 46 NJPER 195 ( & 49 2019), aff = d P.E.R.C. No. 2020-49, 46 NJPER 509 ( & 113 2020). Under that doctrine, an employer is prohibited from changing mandatorily negotiable working conditions unless the union waives the statutory right to negotiate, the employer and union have reached agreement on the subject, or the union and employer reach impasse in negotiations.5/ That principle of labor relations applies to all negotiable terms and conditions of employment, including the subject of health insurance contributions. State of New Jersey, 46 NJPER 195 (fn. 47). And the status quo can be defined by statutes setting terms and conditions of employment. State of New Jersey, P.E.R.C. No. 87-21, 12 NJPER 744 ( & 17279 1986); State of New Jersey, I.R. No. 82-2, 7 NJPER 532 ( & 12235 1981).
In this case, Chapter 78 defined the status quo for unit employees = insurance contributions at Tier 4 unless and until the Board and Administrators Association agreed to change the Tier 4 contribution amount. The Board and Association did not agree to such a reduction, as evidenced by the omission of health insurance contribution provision(s) from the 2015-2018 and 2018- 2021 Agreements.6/ Prior to the January 2017 adjustment, the 1.5% base salary deductions the Board had made for a period of months was not specifically agreed to by the Board and Administrators Association and was inconsistent with the status quo as defined by Chapter 78. Thus, contrary to the Administrators Association = s contentions, the adjustment to Tier 4 levels in January 2017 was not an unlawful unilateral change under the Act, but compelled by the Act = s and Chapter 78's mandate that any adjustment to Tier 4 contributions must be negotiated before being changed. In other words, the change in January 2017 preserved the status quo. See Sussex County, P.E.R.C. No. 83-4, 8 NJPER 431 ( & 13200 1982)(Commission dismisses complaint alleging employer violated Section 5.4a(5) by unilaterally granting merit pay increases where evidence did not establish a change to the status quo governing merit pay practices); City of Trenton, P.E.R.C. No. 2002-70, 28 NJPER 243 ( & 33092 2002), aff = d 30 NJPER 199 ( & 74 App. Div. 2004)(Commission dismisses (a)(5) claim over employer = s decision to grant leave without pay to unit employee where decision was not inconsistent with practice governing leave procedures); Borough of Ridgefield, P.E.R.C. No. 2008-27, 33 NJPER 279 ( & 104 2007)(Commission dismisses (a)(5) claim alleging change to practice of paying out terminal leave and explained that A the Borough acted consistent with that practice [governing terminal leave] and therefore was not required to negotiate before continuing to act consistent with that practice. @ )
The January 2017 adjustment to Tier 4 contributions was also consistent with the alleged past practice regarding health benefits for administrators and Education Association members. The Administrators Association acknowledges in its charge and briefs that unit employees had A . . . always received the same benefit package as that of the teachers @ and that, consistent with that practice, Education Association and Administrators = Association unit employees contributed the same amount towards their health insurance. The January 2017 adjustment was consistent with that practice. For 2015-2018, Education Association members were required to contribute at Tier 4 levels, and, in January 2017, the Board required administrators to make Tier 4 contributions consistent with what the teachers were required to contribute towards health benefits. The January 2017 adjustment was not a unilateral change to the status quo for health benefits for administrators.7/ Sussex County, Ridgefield. Rather, it preserved the status quo on health benefits.
While the Administrators Association acknowledges that Education Association unit employees were required to make Tier 4 contributions for 2015-2018, and that the January 2017 adjustment to Tier 4 contributions for administrators was no different than what teachers were required to contribute, the Administrators Association nonetheless contends, in this limited instance, administrators should not have to contribute the same as teachers. According to the Administrators Association, administrators are only required to contribute 1.5% of their base salaries for 2015-2018 because the preemption analysis that mandated Tier 4 contributions for teachers does not apply to administrators. I disagree.
Whether the preemption doctrine applies to administrators in this case is irrelevant. Under Chapter 78 and N.J.S.A. 34:13A- 5.3, the Administrators Association was obligated to continue making Tier 4 contributions until the parties negotiated a collective negotiations agreement altering those contributions. Ridgefield Park Bd. of Ed., 2020 N.J. LEXIS 902; Lacey Tp., 46 NJPER 447. They did not. Absent such agreement, Administrators Association unit employees must make Tier 4 contributions towards their health insurance under both Chapter 78 and the unilateral change doctrine.
The Administrators Association also contends that a hearing is required to determine why the District adjusted insurance contributions before and after January 2017 and further asserts that oral promises or verbal agreements may have been reached regarding health insurance contributions. However, this evidence is barred by the parol evidence rule and does not justify the issuance of a complaint. Moreover, even if an oral promise or agreement was reached between the Board and Association, that type of agreement does not justify alteration of the Tier 4 contributions under Chapter 78. Rather, under the Supreme Court = s and Commission decisions in Ridgefield Park and Township of Lacey, the parties must ratify a successor collective negotiations agreement that memorializes a change to Tier 4 contributions before discontinuing Tier 4 contributions.
The parol evidence rule A . . . is not a rule of evidence, but a rule of substantive law. @ Harker v. McKissok, 12 N.J. 310, 321 (1953); Middlesex Cty., H.E. No. 2001-5, 26 NJPER 392 ( & 31153 2000); aff = d P.E.R.C. No. 2001-12, 26 NJPER 426 ( & 31165 2000). The rule is intended to exclude extrinsic evidence that varies or adds to the clear terms of a integrated written agreement. Casriel v. King, 2 N.J. 45, 51 (1949); Raritan Tp. Municipal Utilities Authority, H.E. No. 84-33, 10 NJPER 64 ( & 15037 1983), adopted at P.E.R.C. No. 84-94, 10 NJPER 147 ( & 15072 1984). In explaining the rule = s operation, the Supreme Court wrote:
The embodiment of the terms of a jural act in a single memorial constitutes the integration of the act, i.e. its formation from negotiations and transactions in themselves without jural effect into an integral documentary unity, and it = s a legal consequence of such integration that all other utterances of the parties on that topic are legally immaterial for the purpose of determining what are the terms of their act . . . The essence of a voluntary integration is the intentional reduction of the act to a single memorial, and where such is the case, the law deems the writing to be the sole and indisputable repository of the intention of the parties . . . Extrinsic evidence of a substantially different intention is not admissible to overcome and qualify the intrinsic force of the written words. . . .
[12 N.J. at 321]
While evidence of extrinsic circumstances surrounding the formation of a written agreement can be used as an aid in interpreting an ambiguous phrase in an agreement, A such evidence is adducible only for the purpose of interpreting the writing B not for the purpose of modifying or enlarging . . . its terms. @ Casriel, 2 N.J. at 51, Raritan Tp. Utilities Authority, 10 NJPER 64, p. 14 of Slip. Op. Where such circumstantial evidence
A . . . tends to show not the meaning of the writing, but an intention wholly unexpressed in the writing, it is irrelevant. @ Id. This restriction on the use of circumstantial evidence is intended to ensure a court or the Commission A . . . will not make a different or a better contract than the parties themselves have seen fit to enter into. @ Washington Construction Co. v. Spinella, 8 N.J. 212, 217 (1951); 10 NJPER 64, p. 14 of Slip Op.
Here, the parties entered into a integrated collective negotiations agreement that cannot be varied by extrinsic evidence of oral promises, negotiations or verbal agreements on health insurance contributions. Under Chapter 78, Tier 4 contributions became a provision of the parties = 2012-2015 Agreement. N.J.S.A. 18A:16-17.2. In negotiating the 2015-2018 Agreement, the Administrators Association and the Board A . . . were free to propose and negotiate with regard to all appropriate subjects which it desires to place before the other for consideration. @ (Article III(A) of 2015-2018 Agreement and 2012- 2015 Agreement). Once negotiated, any agreement A . . . shall incorporate all rights and obligations assumed by each party and reflect the complete and final understanding on all matters covered by this negotiated agreement @ , and such negotiated agreement A shall be reduced to writing and after ratification, be signed by all parties. @ (Article III(A) of the 2015-2018 Agreement and 2012-2015 Agreement). Furthermore, the terms of the 2015-2018 Agreement A shall not be modified in whole or in part by the parties, except by mutual agreement to reopen for negotiations as by written amendment duly executed by both parties. @ (Article III(D) of the 2015-2018 Agreement and 2012- 2015 Agreement). The parties also agreed that the 2015-2018 Agreement A represents and incorporates the complete and final understanding and settlement by the parties of all negotiated matters @ and that A neither party will be required to negotiate with respect to any such matter @ during the term of the 2015-2018 Agreement. (Article XV of the 2015-2018 Agreement and 2012-2015 Agreement)
All of the above-quoted provisions are clear indices of a completely integrated collective negotiations agreement for 2015- 2018 that cannot be modified or changed by extrinsic evidence of oral promises or verbal agreements. The Administrators Association cannot add to the 2015-2018 Agreement, by way of parol evidence, a provision limiting health insurance contributions to 1.5% of base salaries. To do so would not
A . . . tend to show the meaning [of the 2015-2018 Agreement]; @ , but instead attempt to prove an intention A . . . wholly unexpressed in the writing. . . @ and have the effect of making
A . . . a different or a better contract than the parties themselves have seen fit to enter into. @ Casriel, 2 N.J. at 51; Washington Construction Co., 8 N.J. at 217. That outcome is barred by the parol evidence rule. Id.
The Administrators Association is correct that the subject of health insurance contributions became negotiable for the 2015- 2018 Agreement and was not, like the Education Association = s 2014-2018 Agreement, preempted by Chapter 78. But the Administrators Association chose not to negotiate that subject as part of the 2015-2018 and 2018-2021 Agreements. Unless and until the Administrators Association and Board collectively negotiate and ratify an agreement to change Tier 4 contributions, Tier 4 contributions remain the status quo and cannot be changed under Chapter 78 and N.J.S.A. 34:13A-5.3.
For these reasons, I find the Administrators Association = s charge does not satisfy the complaint issuance standard.8/ ORDER The unfair practice charge is dismissed.
/s/ Jonathan Roth
Jonathan Roth
Director of Unfair Practices
DATED: October 20, 2020
This decision may be appealed to the Commission pursuant to N.J.A.C. 19:14-2.3.
Any appeal is due by November 2, 2020.
1/ These provisions prohibit public employers, their representatives or agents from: A (1) Interfering with, restraining or coercing employees in the exercise of the rights guaranteed to them by this act. (3)Discriminating in regard to hire or tenure of employment or any term and condition of employment to encourage or discourage employees in the exercise of the rights guaranteed to them by this act. (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, or refusing to process grievances presented by the majority representative. @
2/ On January 30, 2017, the Administrators Association filed an identical charge bearing docket number CO-2017-166. On June 23, 2017, the Administrators Association withdrew the charge without prejudice and on October 23, 2017, filed the instant charge.
3/ The Commission docket numbers for the scope of negotiations petitions are SN-2017-047 and SN-2017-056.
4/ The Board raises additional arguments that unauthorized acts by District administrators regarding Chapter 78 contributions are not binding on the Board and that the alleged practice of giving health benefits to administrators equal to those for teachers is tantamount to an illegal parity clause. Since I do not rely on these arguments in disposing of this charge, I decline to issue an advisory opinion on the arguments = merits.
5/ For negotiations units of school board employees, impasse does not justify an employer = s unilateral change to a mandatorily negotiable term and condition of employment. N.J.S.A. 34:13A-33 (Statute provides that a school board cannot change negotiable terms and conditions of employment A . . . without specific agreement of the majority representative @ ).
6/ Indeed, the 2018-2021 Agreement = s express referral to the Commission for a determination as to how much administrators should contribute towards health benefits is an acknowledgment that no agreement has yet been reached on the subject.
7/ The Administrators Association is not alleging the Board refused to negotiate, upon demand, over reduction to Chapter 78 contributions. Instead, the Administrators Association alleges the Board unilaterally changed a negotiable term and condition of employment by adjusting health insurance contributions in January 2017.
8/ The Administrators Association does not allege any facts in support of an (a)(1) or (a)(3) violation. I, therefore, dismiss those claims.
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