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In re NJ Transit Bus Operations

Decided: May 10, 1989.

IN THE MATTERS OF NJ TRANSIT BUS OPERATIONS INC., NEW JERSEY TRANSIT CORPORATION AND AMALGAMATED TRANSIT UNION, NEW JERSEY COUNCIL; NJ TRANSIT MERCER, INC., NEW JERSEY TRANSIT CORPORATION AND UNITED TRANSPORTATION UNION, LOCAL 33 (PATERSON AND WARWICK DIVS.); NJ TRANSIT BUS OPERATIONS, NEW JERSEY TRANSIT CORPORATION AND TRANSPORT WORKERS UNION OF AMERICA, LOCAL 225


On appeal from the Public Employment Relations Commission.

Gaulkin, Bilder and R. S. Cohen. The opinion of the court was delivered by Gaulkin, P.J.A.D.

Gaulkin

In ruling on a series of scope of negotiation petitions filed by the bus operating subsidiaries of New Jersey Transit Corporation (NJT), the Public Employment Relations Commission (PERC) defined for NJT bus employees a scope of negotiations broader than that available to other public employees. NJT appeals.

I.

NJT was created by the Public Transportation Act of 1979 (PTA) to "provide for the operation and improvement of a coherent public transportation system in the most efficient and effective manner." N.J.S.A. 27:25-2b, e (West Supp.1988). In 1980, exercising its power "to acquire and operate public transportation assets" (N.J.S.A. 27:25-2e), NJT acquired Transport of New Jersey, a private bus company, and its subsidiary, Maplewood Equipment Company. Those entities became a wholly-owned subsidiary of NJT named NJ Transit Bus Operations, Inc. In 1984 NJT acquired Mercer County Improvement Authority, which operated bus services in Mercer County; that entity was renamed NJ Transit Mercer, Inc.

Respondents Amalgamated Transit Union, New Jersey Council, United Transportation Union Local 33, Transport Workers Union of America Local No. 225, and ATU Division 540 represented various groups of employees employed by the acquired

bus lines and now represent, in several negotiating units, employees of NJT.

In 1987, NJT filed with PERC seven scope of negotiations petitions challenging the negotiability of various provisions which respondents sought to include in new labor agreements. NJT asked PERC to find the disputed proposals outside the scope of negotiations and to bar such proposals from interest arbitration proceedings initiated by respondents under N.J.S.A. 27:25-14c (West Supp.1988). The petitions were consolidated into a single proceeding. After briefing and oral argument, PERC issued its Decision and Order determining the scope of negotiations under the PTA and the negotiability of each of the challenged contract proposals. NJT appeals, asserting that PERC erred both in its definition of the scope of negotiability and in its application of that standard to the contract proposals.

II.

In its Decision and Order, PERC described the core question as being "what scope of negotiations did the Legislature authorize when it enacted the [PTA]." The unions' argument, PERC said, was that "the Legislature retained the scope of negotiations set out under the federal Labor-Management Relations Act, 29 U.S.C. § 141 et seq. " (LMRA), while NJT argued that "the Legislature limited the scope of negotiations to that provided for New Jersey public employees as set forth in New Jersey court cases interpreting the EERA [ i.e., the New Jersey Employer-Employee Relations Act, N.J.S.A. 34:13A-1 to 21]." If the LMRA applied, NJT would be required to bargain with the unions over "wages, hours, and other terms and conditions of employment" (29 U.S.C. § 158(d)), that is, over issues which "settle an aspect of the relationship between the employers and employees." Allied Chemical & Alkali Workers v. Pittsburgh Plate Glass Co., 404 U.S. 157, 178, 92 S. Ct. 383, 397, 30 L. Ed. 2d 341 (1971). If the EERA applied, NJT would be required to negotiate with respect to "terms and conditions of

employment" (N.J.S.A. 34:13A-5.3), which have been judicially defined as

those matters which intimately and directly affect the work and welfare of public employees and on which negotiated agreement would not significantly interfere with the exercise of inherent management prerogatives pertaining to the determination of governmental policy.

State v. State Supervisory Employees Ass'n., 78 N.J. 54, 67 (1978).

After making a detailed analysis of the PTA, which it found "much more complicated" than the parties understood, PERC fashioned a negotiability test for NJT bus employees which is a hybrid of LMRA private sector and EERA public sector principles. PERC found that "the Legislature intended that the [NJT bus] employees have [negotiation] rights similar to what they had before the takeover," but that negotiations "cannot preclude" NJT from fulfilling its "statutory mission." To that extent, the employees' "labor relations rights are more limited than they were when these employees were in the private sector." The "statutory mission" test, PERC explained,

must be more narrowly construed than the negotiability limitation under the EERA. This limitation must come from the [PTA] and [NJT's] responsibility under that statute and cannot be based upon some broad and undefined exercise of managerial authority. The critical distinction would be that 'issues that settle an aspect of the relationship between the employer and ...


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