On appeal from a final decision of the Board of Review, Department of Labor & Industry.
Michels, Pressler and Trautwein. The opinion of the court was delivered by Trautwein, J.A.D.
[190 NJSuper Page 371] Plaintiff's application for unemployment benefits was rejected by a local claims office on the ground that he had not accumulated sufficient earnings during his base year. This determination was later upheld by the Appeal Tribunal and by the Board of Review. On this appeal he maintains that a monthly displacement allowance he received pursuant to the Regional Rail
Reorganization Act of 1973, 87 Stat. 986; 45 U.S.C.A. § 701 et seq. (1974) (the "act"), constitutes earned "remuneration" within the contemplation of our unemployment compensation law and that he therefore accumulated sufficient earnings during his base year to qualify for benefits. We agree.
Plaintiff was employed as a driver by Penn Truck Lines of Philadelphia ("Penn") for 31 years until July 1, 1977, at which time he was "technically laid off" because Penn had no work for him. Thereafter, he began collecting on a monthly basis a "displacement allowance" from Penn as provided in both his local union contract and the act. After receiving his last check on July 24, 1981 he was informed by his congressman that the applicable portions of the act had been repealed as of August 31, 1981. On November 6, 1981 he filed a claim for unemployment compensation benefits with a local claims office and shortly thereafter his claim was determined to be invalid on the ground that he lacked sufficient base weeks or sufficient base year wages to establish a valid claim. Thereafter he appealed this decision to the Appeal Tribunal, which, after a hearing on December 18, 1981, determined that his claim was invalid under N.J.S.A. 43:21-4(e) on the ground that the monthly displacement allowance he received from Penn during his base year did not qualify as "remuneration" and thus that he did not have sufficient base year earnings as required by the statute. This decision was appealed to the Board of Review which, in a decision dated January 26, 1982, affirmed the decision of the Appeal Tribunal on the basis of the record below. This appeal followed.
A brief discussion of the act will serve to place the issue presented in context. Congress recognized that rail service in the northeast and midwest regions of the United States was inadequate and that many of the area railroads were bankrupt and in need of reorganization. 45 U.S.C.A. § 701(a)(1). One of the purposes of the act, therefore, was "the reorganization of railroads in this region into an economically viable system capable of providing adequate and efficient rail service to the
region." 45 U.S.C.A. § 701(b)(2). In furtherance of this goal the United States Railway Association (the "Association"), 45 U.S.C.A. § 711, and the Consolidated Rail Corporation (the "Corporation"), 45 U.S.C.A. § 741, were established. The Association was authorized to prepare for submission to Congress a "final system plan" designed to implement the goals set forth in the act. 45 U.S.C.A. §§ 716-717. The Corporation was empowered to acquire rail properties designated in the final system plan; to rehabilitate, improve and modernize such properties, and to maintain adequate and efficient services. 45 U.S.C.A. § 742. The act further provided for the takeover of insolvent railroads by financially stable lines pursuant to the final system plan. 45 U.S.C.A. § 716(c)(1)(B).
To protect railroad employees affected by action taken pursuant to the final system plan, the act created a class of "protected employees" defined as "any employee of . . . an acquiring or selling railroad who is adversely affected by a transaction . . . who . . . has not reached age 65 on the effective date of this Act." 45 U.S.C.A. § 771(3). Under the act "[a] protected employee whose employment is governed by a collective bargaining agreement will not, except as explicitly provided in this title . . . during the period in which he is entitled to protection, be placed in a worse position with respect to compensation, fringe benefits, rules, working conditions, and rights and privileges pertaining thereto . . ." 45 U.S.C.A. § 775(a). To effectuate this goal, a "monthly displacement allowance" was created, based on the rate of pay of the employee. 45 U.S.C.A. § 775(b)(1)(A). However, in no event was the displacement allowance to exceed $2,500 in any one month. 45 U.S.C.A. § 775(b)(1)(E). For any protected employee with five or more years of service as of the effective date of the act, the allowance would continue until the employee reached the age of 65 and, in the case of a protected employee with less than five years of service, would continue for a period equal to the number of years of service. 45 U.S.C.A. § 775(c). The allowance would terminate upon the employee's death, retirement, resignation or
dismissal for cause. 45 U.S.C.A. § 775(c). Plaintiff received benefits pursuant to the act from July 1, 1977 until the applicable sections were repealed on August 1, 1981.*fn1
Under the New Jersey Unemployment Compensation law, N.J.S.A. 43:21-1 et seq., an unemployed individual is eligible to receive benefits with respect to any week only if it appears that:
[w]ith respect to a base year as defined in subsection (c) of R.S. 43:21-19 the individual has established at least 20 base weeks as defined in subsection (t) of R.S. 43:21-19, or, in the alternative, has earned $2,200.00 or more in the individual's base year, except that with respect to benefit years commencing on or after January 1, 1978, an individual's base week wages in ...