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Communications Workers of America v. Atlantic County Association for Retarded Citizens

Decided: May 7, 1991.


Gibson, J.s.c.


This is a labor dispute arising out of plaintiff-union's efforts to compel a representation election on behalf of the employees of defendant, Atlantic County Association for Retarded Citizens (ARC). ARC challenges the jurisdiction of the court and argues that the issue should be resolved administratively. It also contests plaintiff's assumption that the organizational rights of the affected employees are protected constitutionally. Finally, ARC contends that it lacks sufficient control over wages and working conditions to bargain effectively and that primary control over those areas lies with the State of New Jersey.

Procedurally, this matter is before the court by way of an order to show cause. The State has cross-moved for summary judgment. The following represents this court's factual findings and conclusions of law.


Factual Background.

Plaintiff, Communications Workers of America, AFL-CIO (CWA) is a labor organization representing workers throughout New Jersey. ARC is a non-profit corporation principally engaged in providing education, rehabilitation and training services for retarded citizens and their families in Atlantic County. In July and August 1990, certain of ARC's employees made known to CWA that they were desirous of joining the union and signed authorization cards designating CWA as their majority representative. CWA responded by filing a petition with the National Labor Relations Board (NLRB) seeking a representational election. ARC resisted the petition claiming that the NLRB lacked jurisdiction and that the State actually controls the salaries, benefits and other working conditions of ARC employees. After three days of hearings, CWA elected to withdraw its petition and instead sought the same relief before the Public Employees Relations Commission (PERC). CWA

subsequently withdrew that petition and filed this action on December 4, 1990.

The relationship between ARC and the State is sharply disputed particularly on the issue of employee control. For present purposes, however, the facts must be viewed in a light most favorable to ARC. R. 4:46-2. ARC is a non-profit corporation which provides services to the State through the Department of Human Services, Division of Developmental Disability. Those services implement programs developed in accordance with various legislative directives and, in particular, N.J.S.A. 30:1-12. Although not a State agency, ARC is licensed by the State pursuant to N.J.A.C. 10:44A-1 et seq. and is subject to substantial State control. For example, the overwhelming majority of ARC's funding comes from the State and its ability to generate revenue independently is quite limited. Indeed, with respect to the employee units plaintiff seeks to organize, 100% of the funding comes from the State. The State also sets budget ceilings, must approve all increases and requires that all budgets conform to State guidelines.

Through these same controls, together with its written contract with ARC, the State regulates the wages of ARC employees. The State not only sets wage ceilings, fringe benefits and salaries for substitutes but it also determines minimum staffing requirements and mandates what amounts are to be budgeted for client's food, clothing and leisure activities. Once approved, any budget modification of more than $2,000.00 between line items needs separate State approval. In 1990, for example, ARC sought a cost of living increase for its staff. That request was rejected by the State. In sum, through licensing, state regulations and contractual limitations, the State exercises ultimate control over the essential economic terms of employment for ARC employees.

ARC does retain some control over working conditions. ARC decides who it will hire or fire and handles all employee grievances. It also has the ability to increase wages but only if

it can raise funds through other sources. That has never occurred in any of the employee units involved here. There are certain ARC functions over which the State has no control. For example, the State does not appoint ARC's board of trustees, nor does it select its executive director or have any direct control over day-to-day operations.


Legal Conclusions.

Constitutional Claims.

Normally, jurisdictional issues would be treated at the outset. However, given the purely legal nature of ARC's constitutional challenge, the limitations on agency expertise in this area*fn1 and the impact that such a challenge has regardless of which forum is ultimately determined to be appropriate, that question will be addressed first.

The right of employees to organize is firmly embedded in our Constitution. As stated in, Art. I, par. 19 of the New Jersey Constitution:

Persons in private employment shall have the right to organize and bargain collectively. Persons in public employment shall have the right to organize, present to and make known to the State, or any of its political subdivisions or agencies, their grievances and proposals through representatives of their own choosing.

It is clear from this provision and from the various cases interpreting it that the right to organize and bargain collectively is not only constitutional in its dimension but should be accorded the "same stature as other fundamental rights." Cooper v. Nutley Sun Printing Co. Inc., 36 N.J. 189, 198, 175 A.2d 639 (1961). Nor is ...

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