On certification to the Superior Court, Appellate Division, whose opinion is reported at 276 N.J. Super. 329 (1994).
The opinion of the Court was delivered by Handler, J. Chief Justice Wilentz and Justices O'Hern, Garibaldi, and Stein join in Justice Handler's opinion. Justices Pollock and Coleman did not participate.
The opinion of the court was delivered by: Handler
(This syllabus is not part of the opinion of the Court. It has been prepared by the Office of the Clerk for the convenience of the reader. It has been neither reviewed nor approved by the Supreme Court. Please note that, in the interests of brevity, portions of any opinion may not have been summarized).
NEW JERSEY TURNPIKE AUTHORITY V. NEW JERSEY TURNPIKE SUPERVISORS ASSN. (A-20-95)
Argued September 26, 1995 -- Decided January 31, 1996
HANDLER, J., writing for a unanimous Court.
The primary issue on appeal is whether procedures, including binding arbitration, determining minor discipline for sexual harassment complaints in the workplace are within the scope of collective negotiations.
A disciplinary action was taken against a supervisory employee working for the New Jersey Turnpike Authority (Authority), a governmental agency. The disciplinary action was based on a claim that the supervisor had sexually harassed a subordinate employee. The claim was made in accordance with the Authority's Sexual Harassment Policy. Following a hearing, the Authority's sexual harassment committee concluded that the supervisor had sexually harassed the claimant and recommended a three-day suspension without pay.
The supervisory employee was a member of the New Jersey Turnpike Supervisors Association (Association), an employee union. The Association had entered into a Collective Negotiations Agreement (CNA) with the Authority that provided disciplinary procedures, including binding arbitration of grievances. The Association filed a grievance on behalf of the supervisor against the Authority, alleging that the Authority violated the disciplinary procedures of Article XV of the CNA. The Authority refused to hear the grievance or submit it to arbitration, contending that because the discipline was based on a claim of sexual harassment, the appropriate procedures for determining the discipline were governed by the New Jersey Law Against Discrimination (LAD) and, therefore, were beyond the scope of collective negotiations and were unenforceable.
Following a request for arbitration by the Association, the Authority submitted a Scope of Negotiations claim to the Public Employment Relations Commission (PERC), claiming that the grievance was preempted by the LAD and Executive Order No. 88 that required state employers to adopt policies to eradicate sexual harassment in the workplace. PERC appointed an arbitrator who susatined the grievance. PERC also sustained the grievance, determining that the disciplinary procedures applicable to sexual harassment charges were negotiable and that a grievance related to those procedures was arbitrable under the CNA.
The Authority appealed PERC's decision to the Appellate Division, which affirmed the Conclusion that the disciplinary procedures involving charges of sexual harassment were within the scope of collective negotiations and that the grievance relating to those procedures was subject to binding arbitration under the collective negotiations agreement.
The Supreme Court granted the Authority's petition for certification.
HELD: State laws and policies that prohibit discrimination by sexual harassment do not statutorily preempt or supersede the statutory authority of public employees and their representatives to negotiate disciplinary procedures, including binding arbitration, for imposing minor discipline based on workplace sexual harassment charges. Moreover, the negotiation of disciplinary procedures, including binding arbitration, for the imposition of discipline based on claims of sexual harassment is specifically authorized as a negotiable subject and does not impinge on or implicate an inherent managerial prerogative.
1. N.J.S.A. 34:13A-5.3 of the Public Employer-Employee Relations Act (Act) clearly provides, consistent with express legislative intent, that disciplinary procedures be subject to collective negotiations and that those procedures may include binding arbitration. Under N.J.S.A. 34:13A-5.3 and Article XV of the CNA, binding arbitration has been authorized to resolve a dispute over the disciplinary procedures that are applicable for imposing minor discipline, which under the CNA includes suspensions for up to five days. (pp. 6-11)
2. Under the Act, if an aggrieved employee has an alternative statutory remedy against alleged unjust discipline, then binding arbitration of that grievance, otherwise authorized as part of negotiated disciplinary procedures, may not be invoked. The supervisor has no appeal rights under the LAD or any other statute in respect of his minor discipline. Therefore, under N.J.S.A. 34:13A-5.3, the specific and narrow statutory exemption of disciplinary procedures from collective negotiation is not applicable to disciplinary procedures invoked in a claim based on sexual harassment. (pp. 11-13)
3. An employer's obligation to adopt and implement policies against sexual harassment is distinct from the employees' ability to seek review of disciplinary actions based on allegations of sexual harassment. The duty imposed by the LAD, Executive Order No. 88 and Lehmann on public employers to enact and enforce policies and procedures to eliminate sexual harassment discrimination in the workplace is not undermined by a collectively negotiated agreement requiring fair disciplinary procedures and permitting neutral review when an employee is accused of sexual harassment. So long as the substantive standards defining sexual harassment are applied, there is no fundamental inconsistency between the Authority's Sexual Harassment Policy and the negotiated disciplinary procedures invoked to determine whether sexual misconduct occurred and, if so, the appropriate discipline. Here, the negotiated disciplinary procedures were applicable. (pp. 13-21)
4. Terms and conditions of public employment are negotiable only if the subject: 1) intimately and directly affects the work and welfare of public employees; 2) has not been preempted by statute or regulation; and 3) is a matter on which negotiated agreement would not significantly interfere with the exercise of inherent management prerogatives pertaining to the determination of governmental policy. In applying that three-pronged test, the Court finds that: affording employees with impartial review of disciplinary disputes affects the work and welfare of public employees; the disciplinary procedures are not preempted by statute; and application of disciplinary procedures for minor disciplines will not significantly interfere with the governmental policy of eradicating sexual harassment from the workplace and enforcing those policies. (pp. 21-26)
Judgment of the Appellate Division is AFFIRMED.
CHIEF JUSTICE WILENTZ and JUSTICES O'HERN, GARIBALDI, and STEIN join in JUSTICE HANDLER'S opinion. JUSTICES POLLOCK and COLEMAN did not participate.
The opinion of the Court was delivered by HANDLER, J.
In this case, disciplinary action was taken against a supervisory employee based on a claim that he had sexually harassed a subordinate employee. Both individuals worked for the New Jersey Turnpike Authority, a governmental agency. The supervisor was a member of an employee union, which had entered into a collective negotiations agreement that provided disciplinary procedures, including the binding arbitration of grievances.
After the imposition of discipline, the supervisor filed a grievance, claiming that the Authority failed to follow disciplinary procedures required by the agreement. The Authority refused to hear the grievance or submit it to arbitration, contending that because the discipline was based on a claim of sexual harassment, the appropriate procedures for determining the discipline were governed by the Law Against Discrimination and, therefore, were beyond the scope of collective negotiations and were unenforceable.
That contention is the central issue on this appeal. A related issue is whether the imposition of employee discipline based on sexual harassment in the workplace implicates matters of managerial prerogative and, therefore, disciplinary procedures established through collective negotiations, including binding arbitration, cannot be applied in such a case.
The New Jersey Turnpike Authority ("Turnpike Authority" or "Authority"), a public administrative agency of the State of New Jersey, N.J.S.A. 27:23-1 to -40, is a public employer within the meaning of the "New Jersey Employer-Employee Relations Act." N.J.S.A. 34:13A-3(c) ("Act"). The Authority entered into a Collective Negotiations Agreement ("CNA") with the New Jersey Turnpike Supervisors Association ("Supervisors Association"), an organized labor representative within the meaning of the Act, N.J.S.A. 34:13A-3(d), and the collective negotiations representative for the toll supervisors employed by the Authority. The CNA, covering the term from July 1991 through June 1994, provides binding arbitration for minor disciplinary determinations, including suspensions not exceeding five days.
On January 15, 1992, the Authority received notice of a claim filed by one of its female toll collectors ("claimant") alleging that her immediate supervisor, Patrick Gabriele ("supervisor"), sexually harassed her. The supervisor was employed by the Authority as a Toll Plaza Supervisor and was a member of the Supervisors Association. According to the claimant, on January 11, 1992, she misplaced a pass that the Authority's work rules required her to have in her possession. The claimant informed the supervisor that she misplaced her pass. The claimant and the supervisor then searched for the pass in the claimant's toll booth. In the course of the search, the claimant went down on her hands and knees to look on the floor. While the claimant was in that position, the supervisor allegedly exclaimed, "Hey, look she's on her hands and knees to me," and at the same time, he allegedly gyrated his hips mimicking a sexual motion. Unbeknownst to ...