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Gonzalez v. State Operated School Dist. of the City of Newark

November 16, 2001


On appeal from the New Jersey State Board of Education Decision #29-99.

Before Judges Petrella, Steinberg, and Alley.

The opinion of the court was delivered by: Alley, J.A.D.


Argued October 22, 2001

Appellant, the State-Operated School District of the City of Newark, appeals from a decision of the New Jersey State Board of Education ("State Board") that respondents, Ruben Gonzalez, Paul J. O'Donohue, Claude Craig, and Steven Block, were terminated from employment in a manner that triggered certain statutory benefits under N.J.S.A. 18A:7A-44 after the State-operated district was created. The State Board's decision purported to implement the statute by awarding respondents retroactive salary, plus sixty days back pay. We reverse.

Appellant was created on July 11, 1995, by the New Jersey State Department of Education pursuant to its powers under N.J.S.A. 18A:7A-34 to -52, the school district takeover statute. Those provisions prescribe a reorganization mechanism pursuant to which a local school district, in defined circumstances, can be superseded by a State-operated school district. In this instance, in connection with appellant's creation the Newark Board of Education was removed and its legal identity was terminated.

Respondents are four former employees of the Newark Board of Education. Mr. Gonzalez was the Assistant Executive Superintendent responsible for the supervision of schools in cluster 4, the area of Newark with the largest portion of Hispanic students. Mr. O'Donohue worked as the Director of Purchasing and Warehousing, an unclassified civil service position. Mr. Craig was employed as the sole hearing officer in the Newark Board of Education's Office of Hearing Grievance. Mr. Block held the position of Executive Director in the Office of Accountability and Quality Assurance, an untenured non-civil service position. These four employees were all central administrative or supervisory staff employees in July 1995.

On or about July 13, 1995, each respondent was asked to submit a letter of resignation to the State district superintendent. On August 17, 1995, the State district superintendent directed that respondents be terminated. Respondents were informed that the letters of resignation which they provided upon request more than a month earlier had been accepted.

Approximately three months later, in November 1995, respondents challenged their terminations by filing petitions with the Commissioner of Education which requested a determination that they were entitled to retain their positions pending appellant's fulfillment of its alleged need to comply with N.J.S.A. 18A:7A-44b and c, reinstatement to their positions, and an award of back pay. The Department of Education transmitted these petitions to the Office of Administrative Law, where the matters were consolidated and assigned to an Administrative Law Judge (ALJ). Summary judgment motions were denied on January 10, 1997, by the ALJ, who stated that "a hearing should be conducted on three questions (1) whether [respondents] fall within N.J.S.A. 18:7A-44a or c; (2) whether [appellant] implemented a reorganization of central and supervisory staff, pursuant to N.J.S.A. 18A:7A-44b; and, (3) what relief should be granted to [respondents] if they ultimately prevail."

Following this decision, appellant filed a request for interlocutory review by the Commissioner of Education of the ALJ's order. On February 11, 1997, the Commissioner issued findings which concurred with the ALJ regarding the application of N.J.S.A. 18A:7A-44 to both tenured and non-tenured employees, but which also modified the ALJ's decision by determining that the statute "applies only to those employees whose positions are abolished upon the establishment, or as a result of the reorganization of, a State-operated district; it does not apply to individual decisions to terminate employment where the underlying position is not abolished." Id. The Commissioner directed further fact-finding to decide whether respondents' positions were abolished pursuant to the takeover statute at issue, N.J.S.A. 18A:7A-44.

In the ALJ's Initial Decision, issued April 9, 1999, she found that respondents were not entitled to any relief. This decision was based upon the Commissioner of Education's February 11, 1997 clarifications regarding the non-applicability of N.J.S.A. 18A:7A-44 to them. She found that respondents, as employees-at-will, were terminated under the discretionary authority of the State superintendent and not pursuant to N.J.S.A. 18A:7A-44. She also found that N.J.S.A. 18A:27-4.1 did not apply. Her findings and determination in the Initial Decision were adopted by the Commissioner of Education.

Respondents appealed the Commissioner's decision to the State Board, which on May 3, 2000, awarded relief to respondents that included the salary each would have earned from the time they were terminated until the reorganization took effect, plus sixty days pay.

The State Board determined that respondents were entitled to employment protections pursuant to N.J.S.A. 18A:7A-44, which in pertinent part provides that:

b. Within one year of the establishment of the State-operated school district, the State district superintendent shall prepare a reorganization of the district's central administrative and supervisory staff and shall evaluate all individuals employed in central administrative and supervisory staff positions. The State district superintendent shall implement the ...

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