On appeal from the Division of Workers' Compensation.
Before Judges Pressler, Landau and Newman.
The opinion of the court was delivered by
In Wright v. Port Authority, 263 N.J. Super. 6, 621 A.2d 941 (App. Div.), certif. denied, 133 N.J. 142 (1993), this court held that an employee of the Port Authority of New York and New Jersey who is totally disabled as a result of that employment is not entitled to a workers' compensation award in this State if he is receiving a disability pension from the State of New York. Following that decision, the United States Supreme Court issued its opinion in Hess v. Port Authority Trans Hudson, 513 U.S. , 115 S. Ct. 394, 130 L. Ed. 2d 245 (1994), in which its denial of Port Authority's claim of Eleventh Amendment immunity from suit in the federal court required reexamination of the corporate structure of Port Authority and its relationship to New York and New Jersey. Consideration of Wright in the light of Hess constrains us to disagree with the result we there reached. We are now satisfied that simultaneous receipt by a Port Authority employee of New Jersey compensation benefits and a New York disability pension is not interdicted by our statutes.
Petitioner John R. Bunk, then an employee of Port Authority for some five years, sustained a work-connected injury on September 6, 1988, while driving a truck on the Triborough Bridge. The brakes failed, and he struck a wall and several other vehicles. He was ultimately found by the Judge of workers' compensation to be totally disabled by reason of his ensuing orthopedic and neurological injuries. Accordingly, the Judge dismissed the claim made by petitioner against the Second Injury Fund. The Judge nevertheless concluded, relying on Wright, that because petitioner was by then receiving a disability pension from the State of New York based on the truck-accident injuries, he was not eligible to receive workers' compensation benefits for those injuries under the law of New Jersey.
Subsequent to filing his claim petition relating to the September 1988 accident, petitioner filed a second petition seeking benefits based on occupational injury. He claimed that during the period of his employment he was constantly exposed to dirt, dust, noxious fumes, and other irritants, resulting in pulmonary, ophthalmologic, otologic and nasopharyngeal disease. Following the joint trial of the two petitions, the Judge concluded that petitioner had proved a total of twelve and a half percent of permanent partial total disability based on occupational injury.
Petitioner appeals from the denial of benefits for his total disability referable to the truck accident. Port Authority cross appeals from the allowance of the partial total disability award for occupational injury. We reverse both judgments.
We address first the so-called double recovery issue. As we pointed out in Wright, the inter-relationship between disability pension benefits and workers' compensation benefits available to a public employee in this State is defined by N.J.S.A. 34:15-43 and N.J.S.A. 43:15A-25.1(b) as synthesized by Conklin v. City of East Orange, 73 N.J. 198, 373 A.2d 996 (1977). N.J.S.A. 34:15-43, in general terms, provides that although public employees are entitled to workers' compensation benefits pursuant to N.J.S.A. 34:15-7, et seq., they are disqualified from receipt of those benefits, except for medical treatment and expenses, if they are retired on pension by reason of the same disability or injury for which compensation benefits are claimed. As explained by In re Application of Howard Smith, 57 N.J. 368, 380, 273 A.2d 24 (1971), the effect of that disqualification was to require a public employee to make a binding election between the available pension benefits and the available compensation benefits. He could obtain either but not both in view of the Legislature's clearly evinced intention "not to allow a public employee to receive concurrent pension and compensation benefits for the same disability." This scheme was substantially altered in 1971 with respect to all the major public employee pension funds, including the Public Employees' Retirement System, N.J.S.A. 43:15A-1, et seq.; the Police and Firemen's Retirement System, N.J.S.A. 43:16A1, et seq.; and the Teachers' Pension and Annuity Funds, N.J.S.A. 18A:66-1, et seq. By adoption in that year of N.J.S.A. 43:15A-25.1(b), N.J.S.A. 43:16A-15.2, and N.J.S.A. 18A:66-32.1b(b), a public employee who is totally disabled by reason of work-related disability is permitted to obtain his pension benefits while also receiving periodic workers' compensation benefits provided, however, that the amount of the pension benefit payable is reduced by the amount of the compensation benefits received. The Court in Conklin, supra, 73 N.J. at 204, construed the pension statute amendments as having, by necessary implication, effectively amended N.J.S.A. 34:15-43 as well with the "net effect . . . that the retired public employee is entitled to receive the more advantageous of the benefits payable under the respective statutory provisions."
The question then is whether this integrated scheme of workers' compensation and pension act provisions applies to Port Authority employees. Wright answered that question affirmatively, concluding that Port Authority is a governing body within the intendment of N.J.S.A. 34:15-43, which defines a covered employee as
Every officer, appointed or elected, and every employee of the State, county, municipality or any board or commission, or any other governing body, including boards of education, and governing bodies of service districts, individuals who are under the general supervision of the Palisades Interstate Park Commission and who work in that part of the Palisades Interstate Park which is located in this State, and also each and every member of a volunteer fire company doing public fire duty and also each and every active volunteer, first aid or rescue squad worker, including each and every authorized worker who is not a member of the volunteer fire company within which the first aid or rescue squad may have been created, doing public first aid or rescue duty under the control or supervision of any commission, council, or any other governing body of any municipality, any board of fire commissioners of such municipality or of any fire district within the State, or of the board of managers of any State institution, every county fire marshal and assistant county fire marshal and every special, reserve or auxiliary policeman doing volunteer public police duty under the control or supervision of any commission, council or any other governing body of any municipality, who may be injured in line of duty shall be compensated under and by virtue of the provisions of this article and article 2 of this chapter. . . .
It held, therefore, that since workers' compensation benefits obtained in New Jersey are not offset against a disability pension paid by New York, a Port Authority employee receiving the New York pension is not entitled to any New Jersey compensation benefits. We agree with Wright that Port Authority, although an agency created by bi-state compact, has many characteristics of a body politic and corporate. We are nevertheless constrained to conclude that the term "other governing body" as used by N.J.S.A. 34:15-43 means either a governing body of this State or a governing body whose New Jersey employees are subject to the unilateral exercise of this State's legislative authority. Port Authority is neither. We therefore find no impediment in the New Jersey statutory scheme to a Port Authority employee receiving both his New York pension and his adjudicated New Jersey compensation benefits.
We base this Conclusion on a construction of the pertinent statutory language in the light of the policy considerations underlying the double-recovery bar of N.J.S.A. 34:15-43. It is obvious that public funds not only pay the salaries of public employees but also support, in substantial measure, their entitlements to both workers' compensation benefits and pension benefits. The double-recovery bar is designed, therefore, to protect the public fisc-both the pension funds themselves and the taxpayer dollars required to afford compensation benefits. Thus, while the public employee is entitled to choose the most advantageous combination of benefits available to him in the circumstances, he may not receive both in full measure. We are satisfied that Port Authority, by reason of its structure, financing, and employee relations and benefits, is entirely outside of these fiscal concerns and hence outside of the statute.
To begin with, and in critical contradistinction to other public employees covered by N.J.S.A. 43:15-43, employees of Port Authority are not members of any New Jersey pension system. Port Authority has elected to join the New York State and Local Employees Retirement System. Thus the pension rights and obligations of all Port Authority employees are subject to and determined by New York law, and New Jersey bears absolutely no financial or administrative responsibility therefor at all. Consequently, the necessity of protecting the financial integrity of New Jersey's public pension funds simply does not come into play when dealing with a Port Authority employee. Beyond that, irrespective of how expansively "governing body" as used by N.J.S.A. 34:15-43 may be defined, it is nevertheless clear that the double-recovery bar itself is stated in terms of pension entitlements. The precise language of N.J.S.A. 34:15-43 reads as follows: "No former employee who has been retired on pension by reason of injury or disability shall be entitled under this section to compensation for such injury or disability. . . ." The prohibition does not use the full phrase "no former public employee," but that is obviously what it means since the statute addresses only public employees. By the same token, the statute does not say "retired on a public pension." ...