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Grieco v. Employees'' Retirement System

Decided: May 6, 1980.

FRANK P. GRIECO, PLAINTIFF-RESPONDENT,
v.
EMPLOYEES' RETIREMENT SYSTEM OF THE CITY OF NEWARK, DEFENDANT-APPELLANT



On appeal from Superior Court of New Jersey, Law Division, Essex County.

Fritz, Kole and Lane.

Per Curiam

[173 NJSuper Page 475] This appeal raises the question whether a member of the Employees' Retirement System of the City of Newark may purchase prior service credit for his previous Essex County

employment. Upon plaintiff's complaint in lieu of prerogative writs seeking to compel defendant to permit such a purchase, the trial judge entered judgment for plaintiff. We reverse without regard to the constitutionality of N.J.S.A. 40A:9-5. See Kenney v. East Brunswick Tp. , 172 N.J. Super. 45 (App.Div.1980), holding the statute unconstitutional.

The resolution of the appeal depends upon the impact, if any, of N.J.S.A. 40A:9-5 upon the statutory scheme under which the Employees' Retirement System of the City of Newark, N.J.S.A. 43:13-22.3 et seq. , was established. Existing in substantially the same form since 1931, N.J.S.A. 40A:9-5 provides:

Whenever heretofore or hereafter a transfer has been or shall be effected by appointment, assignment or promotion of a municipal employee to any other department or position in municipal employment, or to a position or department of the county government; or of a county employee to any other position or department in county employment, or to a department or position of a municipal government, in counties of the first or second class, the period of such prior service in said county or municipal employment, for any purpose whatsoever, shall be computed as if the whole period of employment of such employee had been in the service of the department, or in the position, to which the said employee has been transferred. [Emphasis added]

The sponsor's statement accompanying the Senate bill which became law states that the intent of the act was merely to establish a seniority right which had theretofore been denied. See Gudgeon v. Ocean Cty. , 135 N.J. Super. 13, 17 (App.Div.1975). Does "for any purpose whatsoever" include the purchase of prior service credit under the Newark pension system?

None of the cases considering N.J.S.A. 40A:9-5 have considered whether an employee's rights under a public pension system are "seniority" rights within the contemplation of the act. To date the statute has been applied to retroactive pay differentials, vacation pay, longevity pay and preference for

promotional examinations. Kloss v. Parsippany-Troy Hills Tp. , 170 N.J. Super. 153, 161 (App.Div.1979); Libby v. Union Cty. Bd. Freeholders , 125 N.J. Super. 471, 474 (App.Div.1973); Taureck v. Jersey City , 149 N.J. Super. 503, 513-514 (Law Div.1977).

In considering whether N.J.S.A. 40A:9-5 should be construed to apply to pension credit, we note that since seniority rights did not exist at common law the statute must be narrowly construed against any extension of rights not clearly intended. Fivehouse v. Passaic Valley Water Comm'n. , 127 N.J. Super. 451, 455-456 (App.Div.1974), certif. den. 65 N.J. 565 (1974). In resolving the relationship between N.J.S.A. 40A:9-5 and inconsistent provisions of the Civil Service Act relating to seniority rights we have held that the more specific Civil Service Act should prevail. Parelli v. Civil Service Dep't. , 138 N.J. Super. 364, 365-366 (App.Div.1976), aff'd o.b. 72 N.J. 480 (1977).

The act under which the Employees' Retirement System of the City of Newark was formed, N.J.S.A. 43:13-22.3 et seq. , was enacted in 1954, well after the predecessor of N.J.S.A. 40A:9-5. Several provisions are made for purchase of prior service, however, all of which require that service to be within the city. N.J.S.A. 43:13-22.15(b)(1); N.J.S.A. 43:13-22.16; N.J.S.A. 43:13-22.16f; N.J.S.A. 43:13-22.16g. A 1963 amendment, N.J.S.A. 43:13-22.16a, permits the purchase of credit "for time served in active service in the Armed Forces of the United States while a permanent employee of the city. . . ." The only mention of prior county service is contained in N.J.S.A. 43:13-1.2, which applies only to employees as of the effective date of the act (1954) who are ineligible for pension fund membership by reason of having begun employment between the ages of 40 and 55. Such employees were permitted to purchase "credit ...


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