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March 28, 1989


The opinion of the court was delivered by: RODRIGUEZ

 This matter was presented to the court soon after defendant Township of Pennsauken *fn1" passed Resolution 86-310 governing the outside employment of off-duty police officers. Specifically, the Resolution prohibited any direct employment of off-duty officers in security positions and required the channeling of all such employment through the Township police department under a number of terms and conditions set forth in a Hold Harmless and Indemnification Agreement. Plaintiffs, George Bowman and Fraternal Order of Police, Garden State Lodge #3 (hereinafter FOP), *fn2" filed the complaint in this matter challenging the constitutionality of the Resolution and immediately sought a temporary restraining order to enjoin its implementation. The court granted the temporary restraints and scheduled a hearing for a preliminary injunction. At the hearing, the parties agreed to continue to operate under the restraints until the court decided whether to grant a preliminary injunction. *fn3" The parties were requested to submit additional briefs and decision was reserved. The briefing schedule closed in September 1988. The court now addresses the issue of whether preliminary injunctive relief should be granted. For the reasons set forth below, this court holds that the Resolution violates the officers' equal protection and due process rights guaranteed by the fourteenth amendment. Accordingly, the court will grant the preliminary injunction restraining the Township from implementing and enforcing the Resolution. In addition, this opinion serves as the court's findings of facts and conclusions of law.


 FOP is the bargaining representative for all police officers below the rank of sergeant in the Police Department of the defendant Township. The Collective Bargaining Agreement between the parties covering July 1, 1984 through June 30, 1986 included a regulation, Article XXXI, governing the outside employment of FOP members. During negotiations for a successor agreement, defendant Township proposed a ban on all outside employment of FOP members but later withdrew that proposal. At the time the complaint was filed the parties had entered into arbitration in an effort to reach a successor agreement. A successor agreement was signed on January 25, 1988 covering the period from July 1, 1986 to June 30, 1989.

 On October 27, 1986, the Township Committee adopted Resolution 86-310 regulating the "moonlighting" activity of FOP members. *fn4" The Resolution required all prospective employers of Pennsauken police officers in an off-duty security capacity to execute a Hold Harmless, Indemnification and "Moonlighting" Agreement (hereinafter Hold Harmless and Indemnification Agreement) before the police chief would issue any work permits. The agreement provided that the employer would contact the Chief of Police directly about present and future hiring of any police officer for off-duty security employment. In addition, the Hold Harmless and Indemnification Agreement governed the payment and hiring of the officers under the terms and conditions summarized as follows:

* The employer shall pay the Township an amount equal to the officer's salary plus an administrative fee (the Township would then distribute the salary to the officer).
* Prior to any employment of off-duty officers in moonlighting positions, the employer shall co-insure each officer on its workers' compensation insurance policy and shall co-insure the Township as additional insureds at no cost to the Township.
* The employer shall co-insure the Township and its off-duty police personnel hired in a moonlighting capacity in a liability insurance policy in the minimum amounts of one million dollars for each moonlighting off-duty officer; and "said insurance policy shall contain provisions that in the event of any settlement or judicial determination that the aforesaid moonlighting off-duty Pennsauken police employee [is] determined to be either an employee of the employer or an employee of the Township, said insurance company shall pay all the Township's costs of litigation including attorney's fees, costs and any settlement or monies required to be paid by the Township of Pennsauken shall be paid by the insurance company as indicated herein above." Failure to obtain any of these insurance policies constitutes a breach of the agreement and the Township shall have the right to cancel all work permits for moonlighting.
* As further consideration for the Township permitting moonlighting employment, the employer agrees to hold the Township harmless and indemnify the Township for any acts committed by the moonlighting officer in the course of his moonlighting activities, "whether or not it is judicially determined or agreed between any parties that the 'moonlighting' Pennsauken police officer was an employee of the Township or an employee of the employer." The agreement "shall include any settlement or verdict monies which accrue as a result of any actions of any 'moonlighting' Pennsauken police officer." *fn5"

 Prior to adopting the Resolution, the Township required under the collective bargaining agreement that it be notified of any police officer's moonlighting activities but specifically permitted off-duty security work in the Township. In addition, pursuant to the collective bargaining agreement, the Chief of Police or his designee would issue a work permit which could not be unreasonably withheld. *fn6" As a result of the Resolution, the Township, in effect, became a broker in the employment of police officers in off-duty security work and prevented officers from direct employment by third-party employers.

 Copies of Resolution 86-310 were sent under the signature of the Chief of Police, to businesses employing police officers within the Township in November of 1986. Soon thereafter, FOP members were notified by the Chief of Police that their work permits for security work would be rescinded if their employers failed to comply affirmatively with the requirements of Resolution 86-310. Furthermore, no new permits would be issued unless the prospective employer complied with the Resolution. *fn7"

 Plaintiffs bring this action under 42 U.S.C. § 1983, alleging that the resolution violates both the equal protection clause and the due process clause of the fourteenth amendment and the rights guaranteed to FOP members under the New Jersey Constitution. In addition, plaintiffs contend that the resolution impermissibly prohibits officers from exercising a fundamental right to enter into a contract with a private employer. With respect to the equal protection claim, plaintiffs allege that the resolution creates impermissible classes of moonlighting police officers. Specifically, plaintiffs claim that two classes of officers are created by the resolution: (1) officers who provide non-security services and (2) officers who provide security work. Plaintiffs argue that this classification is not rational and does not address a legitimate state interest. *fn8" Plaintiffs argue that the resolution violates the due process rights of the officers by depriving them of a previously enjoyed right to work.

 In addition to disputing plaintiffs' substantive claims, defendants raise several procedural issues. First, they claim that this matter is not ripe for review because plaintiffs have failed to establish either an actual controversy or a violation of constitutional dimension. Second, defendants assert that PERC has exclusive jurisdiction of this matter pursuant to the New Jersey Employer-Employee Relations Act, N.J. STAT. ANN. § 34:13A-1, and that therefore, this court does not have jurisdiction over the action. Third, defendants argue that the court is prohibited from issuing an injunction under the Norris-LaGuardia Act and the collective bargaining agreement.

 With respect to the constitutional claims, defendants assert that the resolution is rationally related to the Township's legitimate interest in protecting its taxpayers against the costs of litigation and potential liability. For support, the Township outlines a series of cases involving the Township which arose from action or inaction by officers engaged in moonlighting activities. Finally, defendants assert that the resolution does not violate the collective bargaining agreement between the parties.


 A. Ripeness

 The court first addresses the issue of whether plaintiffs have alleged a case or controversy within the meaning of Article III of the Constitution. The basic inquiry is whether the "conflicting contentions of the parties . . . present a real, substantial controversy between parties having adverse legal interests, a dispute definite and concrete, not hypothetical or abstract." Railway Mail Ass'n v. Corsi, 326 U.S. 88, 93, 89 L. Ed. 2072, 65 S. Ct. 1483 (1945). Although plaintiffs need not engage in prohibited activity in order to present an actual controversy, a plaintiff challenging "a statute must demonstrate a realistic danger of sustaining a direct injury as a result of the statute's operation or enforcement." Babbitt v. United Farm Workers National Union, 442 U.S. 289, 298, 60 L. Ed. 2d 895, 99 S. Ct. 2301 (1979). In addition, as the Babbitt court stated: "The difference between an abstract question and a 'case or controversy' is one of degree, of course, and is not discernible by any precise test." Id. at 297.

 Defendants contend that this matter is not ripe for adjudication because plaintiffs have not offered any proof that Pennsauken police officers are unable to moonlight in security positions because of the Resolution. In addition, defendants contend that the plaintiffs' claim that the Resolution is facially unconstitutional is without merit.

 In support, defendants cite Vorbeck v. Schnicker, 660 F.2d 1260 (8th Cir. 1981), cert. denied, 455 U.S. 921, 71 L. Ed. 2d 462, 102 S. Ct. 1278 (1982) and Fort Wayne Patrolmen's Benevolent Ass'n v. City of Fort Wayne, 625 F. Supp. 722 (N.D.Ind. 1986), where the courts held that similar claims were not ripe for adjudication. Plaintiffs counter that those cases are factually distinguishable from the instant case. In Vorbeck, a police officers' association brought suit for injunctive relief alleging that certain provisions of personnel regulations were unconstitutional. 660 F.2d at 1261. The court found that the regulations were cast in broad terms and that in the absence of "a concrete factual instance of enforcement as a framework for the court's decision," the dispute was not "ripe" for judicial resolution. Id. at 1266. Similarly, in Fort Wayne, the court found that plaintiffs' claim concerning a proposed change in the City's administrative policy regarding off-duty employment was not ripe for adjudication. 625 F. Supp. at 728. Although the Fort Wayne plaintiffs alleged that their members would suffer a loss of outside employment income due to the regulation, the court stated that the lack of evidence regarding employer reaction to the not-yet-implemented revised version of the policy made the likelihood of injury less than "certainly impending." Id. at 726-27. In addition, the Fort Wayne court found that the plaintiffs' claim of injury based on violation of certain constitutional rights was not ripe since the policy had neither been implemented nor used against an officer. Id.

 This court finds that plaintiffs have alleged a sufficient injury to meet the case or controversy standard. Contrary to the facts of Fort Wayne, the Township's Resolution has been adopted by the Township Committee. Also, FOP members have been notified that their work permits for security work would be rescinded if their employers failed to comply with the requirements of Resolution 86-310. Furthermore, defendants admit that under the adopted resolution, police officers are not permitted to contract security work at their own pay rate. See Answer for Defendants at para. 12. Rather, the Township has established a wage scale for the hiring of officers in security positions by third-party employers. Thus, even if the FOP members' alleged loss of income is speculative, the members' inability to contract security work and set their own pay rate meets the impending injury requirement. In addition, the resolution on its face clearly requires prospective employers of off-duty police officers in a security capacity to execute a Hold Harmless and Indemnification Agreement prior to the issuance of work permits. Plaintiffs challenge this requirement as violative of FOP members' constitutional rights. The Resolution also clearly is limited to security jobs and thus on its face presents a classification that the FOP members challenge under equal protection. Therefore, the development of a factual record may not assist the court because the crucial issue is purely legal: whether the Resolution on its face violates the members' constitutional rights. See, e.g., Thomas v. Union Carbide Agric. Products Co., 473 U.S. 568, 581, 87 L. Ed. 2d 409, 105 S. Ct. 3325 (1985). Accordingly, this court finds that the matter is ripe for adjudication. *fn9"

 B. N.J. Employer-Employee Protection Act

 Defendants contend that the controversy falls within the purview of the New Jersey Employer-Employee Protection Act, N.J. Stat. Ann. § 34:13A-5.4(a)(1) and (5). Specifically, defendants allege that the New Jersey Public Employment Relations Commission (PERC) has primary jurisdiction to determine whether a dispute falls under collective negotiations and has exclusive jurisdiction over unfair labor practices. Thus, defendants contend that PERC is the proper forum for this case. Plaintiffs respond that an exhaustion of administrative remedies is not required for actions brought under 42 U.S.C. § 1983.

 In a line of cases, the Supreme Court has followed consistently the principle first enunciated in Monroe v. Pape, 365 U.S. 167, 5 L. Ed. 2d 492, 81 S. Ct. 473 (1961), that a plaintiff is not required to resort to state administrative procedures before bringing an action pursuant to § 1983. See, e.g., Patsy v. Florida Board of Regents, 457 U.S. 496, 500, 73 L. Ed. 2d 172, 102 S. Ct. 2557 (1982) (citing cases). As the Monroe court stated:

It is no answer that the State has a law which if enforced would give relief. The federal remedy is supplementary to the state remedy, and the latter need not be first sought and refused before the federal one is invoked.

 365 U.S. at 183.


 A. Norris-LaGuardia Act

 Defendants contend that this case involves a "labor dispute" within the meaning of the Norris-LaGuardia Act, 29 U.S.C. § 101. The Act precludes federal courts from having jurisdiction to issue injunctive relief in "a case involving or growing out of a labor dispute" except in very limited circumstances. 29 U.S.C. § 101. In addition, Section 104 of the Act defines specific actions that cannot be enjoined by the federal courts. *fn10"

 Although an action need not be listed in section 104 for the court to be precluded from issuing an injunction, clearly the action must fall within the meaning of a "labor dispute" in order to be covered by the Act. The Act defines "labor dispute" as follows:

The term "labor dispute" includes any controversy concerning terms or conditions of employment, or concerning the association or representation of persons in negotiating, fixing, maintaining, changing, or seeking to arrange terms or conditions of employment, regardless of whether or not the disputants stand in the proximate relation of employer and employee.

 29 U.S.C. § 113(c). In addition, "the critical element in determining whether the provisions of the Norris-LaGuardia Act apply is whether 'the employer-employee relationship [is] the matrix of the controversy.'" Jacksonville Bulk Terminals, Inc. v. International Longshoremen's Ass'n, 457 U.S. 702, 712-13, 73 L. Ed. 2d 327, 102 S. Ct. 2672 (1982) (quoting Columbia River Packers Ass'n, Inc. v. Hinton, 315 U.S. 143, 147, 86 L. Ed. 750, 62 S. Ct. 520 (1942)).

 This court holds that the FOP members' claims do not fall within the meaning of a labor dispute. Rather, the FOP members are seeking a determination by this court of their federal constitutional rights and whether the adopted resolution violates those rights. Accordingly, the Norris-LaGuardia Act is inapposite.

 B. Arbitration Clause

 Article VI of the collective bargaining agreement delineates the grievance procedure for FOP members. Under this article, grievance is defined as "an appeal by an individual Police Officer or the Lodge on behalf of an individual Police Officer or group of Police Officers, from the interpretation, application or violation of terms and conditions of this Agreement." Collective Bargaining Agreement, Article VI (emphasis added). As earlier stated, the outside employment article of the collective bargaining agreement provided that upon approval, the Director of Public Safety would issue a work permit for outside employment. See supra n. 6. The challenged Resolution requires not only that all outside employment be channeled through the chief of police but also that all outside employers of officers in security positions follow the pay scale established by the Township and execute a Hold Harmless and Indemnification Agreement.

 Under the Federal Arbitration Act, federal courts must enforce contractual agreements to arbitrate disputes. 9 U.S.C. § 1. Certain claims, however, are exempted from the Act. It is unclear whether the challenged Resolution requirements fall within the terms and conditions language of the grievance definition. Even if the language of the agreement provides for arbitration of the matters governed by the Resolution, arbitration in this case would not be mandated. Although there is a strong public policy which favors arbitration in general, see, e.g., United Steelworkers v. Warrior & Gulf Navigation Co., 363 U.S. 574, 578, 4 L. Ed. 2d 1409, 80 S. Ct. 1347 (1960), the policy favoring arbitration is "inapplicable" where "the rights that plaintiffs seek to vindicate are not merely contractual, but arise from a federal statute." McLendon v. Continental Group, Inc., 602 F. Supp. 1492, 1501 (D.N.J. 1985). Underlying this exception to the arbitration requirement is "the basic premise that when Congress has provided a judicial remedy for the denial of certain statutory rights, that forum may not be denied through the arbitration provisions of a collective bargaining agreement. A trilogy of Supreme Court decisions has left no doubt on that score." Burke v. Latrobe Steel Co., 775 F.2d 88, 91 (3d Cir. 1985) (citing McDonald v. City of West Branch, Michigan, 466 U.S. 284, 80 L. Ed. 2d 302, 104 S. Ct. 1799 (1984); Barrentine v. Arkansas-Best Freight System, Inc., 450 U.S. 728, 67 L. Ed. 2d 641, 101 S. Ct. 1437 (1981); Alexander v. Gardner-Denver Co., 415 U.S. 36, 39 L. Ed. 2d 147, 94 S. Ct. 1011 (1974)). As the Supreme Court stated in McDonald v. City of West Branch, Michigan, "although arbitration is well suited to resolving contractual disputes, our decisions in Barrentine and Gardner-Denver compel the conclusion that it cannot provide an adequate substitute for a judicial proceeding in protecting the federal statutory and constitutional rights that § 1983 is designed to safeguard." 466 U.S. at 290 (holding that § 1983 action is not precluded by prior arbitration decision).

 In this case, plaintiffs seek the enforcement of their substantive rights of equal protection and due process guaranteed under the Constitution. Under the reasoning of McDonald, plaintiffs could have chosen to challenge the adopted resolution in both the federal court and under the arbitration procedures. Id. Thus, "logically" plaintiffs could have "chosen one of these fora but not the other." McLendon v. Continental Group, Inc., 602 F. Supp. at 1502 (reasoning under Gardner-Denver that plaintiff need not exhaust arbitration procedure before bringing ERISA action). This court will not impose a rule that precludes plaintiffs from asserting their statutory and constitutional rights. Accordingly, the court holds that arbitration is not a prerequisite to filing the instant complaint.


 Plaintiffs assert that the resolution infringes on the fundamental right of the police officers to make a contract with a private employer. It is unclear, however, whether plaintiffs allege that the Resolution violates a ...

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