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In re Township of Middleton


August 14, 2008


On appeal from the Public Employment Relations Commission, CO-2005-226.

Per curiam.


Argued April 1, 2008

Before Judges Skillman, Winkelstein and LeWinn.

The Township of Middletown (Township) appeals from a final decision of the Public Employment Relations Commission (PERC) ordering the Township to reinstate the practice of compensating patrol officers for "shape-up" or travel time when called into work for emergent or immediate overtime duty. The PBA cross-appeals from PERC's decision that the Township had not violated the Employer-Employee Relations Act (the Act), N.J.S.A. 34:13A-1 to -30, by refusing to comply with the Police Chief's grievance determination because the PBA had failed to follow the grievance procedures in the parties' collective bargaining agreement (CBA). We affirm in all respects, substantially for the reasons set forth in the September 28, 2006 final decision of PERC.


The PBA is the exclusive collective bargaining agent for police officers below the rank of sergeant in the Middletown Township Police Department (Department). On November 12, 2004, the Township and the PBA entered into a CBA covering the period of January 1, 2004 through December 31, 2007.

In September 2004, the Township implemented a "palm system"*fn1 to clock Department employees in and out. Prior to this time, there was no time clock system in place. Overtime and regular time cards were either hand written by a supervisor or completed by the officer and signed by a supervisor.

On January 22 and 23, 2005, several patrol officers were called in for immediate overtime duty following a severe snow storm. On their time cards the officers wrote the time they were called as their start time. The shift supervisor signed the cards and submitted them to payroll. Deputy Chief (now Chief) Robert Oches, who was then in charge of payroll, learned of the discrepancy in the time cards and ordered that the officers be paid only as of the time they palmed in.

On February 1, 2005, the PBA filed a grievance on behalf of these officers against the Department and Police Chief John Pollinger (now retired). The grievance claimed that the Department had "changed the manner in which patrol officers are paid for overtime when called in while off duty."

The CBA sets forth a three-step mandatory grievance procedure to be followed in any dispute arising out of the CBA:


The President of the Association or his duly authorized representative . . . discuss[es] the grievance or grievances orally with the immediate supervisor within thirty (30) days of the occurrence . . . otherwise said grievance shall be waived. The immediate supervisor shall answer the grievance within five (5) working days . . . .


If the grievance is not resolved at Step 1 . . . the [PBA] shall present the grievance in writing within five (5) working days, furnishing one (1) copy to the Police Chief and the other to the Business Administrator. If it is not filed, it is waived. . . . The Chief of Police shall answer the grievance within five (5) working days after receipt of said grievance. . . . STEP 3:

If the grievance is not resolved in Step 2, or if no answer has been received by the [PBA] within the time set forth above, the grievance may be presented in writing to the Mayor and Township Committee within five (5) working days.

On February 8, 2005, Pollinger granted the PBA's grievance and, based upon "past practice," ordered that [m]embers of the department called in on an emergent basis, i.e., within 15 to 30 minutes of the start of that shift will be granted a reasonable period of time, not to exceed one hour for travel/shape-up time.

Those officers under these circumstances shall be paid for the entire shift (8 hours) for which they are reporting.

On February 11, 2005, Oches wrote to Pollinger refusing to pay the overtime called for in that grievance response, asserting that the resolution was a violation of the CBA. On February 28, 2005, Township Administrator Robert Czech denied the grievance, asserting that it was outside Pollinger's authority to agree to the overtime pay.*fn2 Pollinger's grievance resolution was never implemented.

The PBA immediately filed an unfair practice charge with PERC against the Township, alleging that the Township had violated the Act by refusing to implement Pollinger's grievance determination and by refusing to recognize the past practice of compensating officers for overtime from the time they were called to the assignment. The Township responded that Pollinger lacked jurisdiction and authority to render the grievance determination, and that the modification of the officers' pay did not constitute a change or rescission of any provision of the CBA.

PERC hearing examiner Deidre K. Hartman held a hearing on October 4 and 5, 2005. The parties stipulated to the following:

(1) the Township is a public employer within the meaning of the Act; (2) the PBA is a public employee representative within the meaning of the Act representing all officers below the rank of sergeant; and (3) officers in the detective bureau and traffic division are compensated from the time they received a call for immediate overtime.

The PBA presented testimony by seven police officers, one of whom had been with the Department since 1968, two since 1981, one since 1986, two since 1988, and one since 1990. All seven officers testified that prior to February 2005, patrol officers called in for immediate overtime were always paid from the time they received the assignment call. No cap was placed on the amount of time an officer would be compensated for travel or shape-up time so long as it was "reasonable." The officers testified not only from their own personal experience, but also based on their knowledge that other patrol officers were similarly compensated.

Current Chief Oches testified, on behalf of the Township, that during his assignment to the patrol division from 1974 to 1979, when called in for immediate overtime he was only paid from the time he arrived at headquarters, not from the time he received the call. Oches stated that this procedure was followed by all officers called in for immediate overtime. During the time that Oches oversaw payroll, he reviewed every time card and rejected any with discrepancies. Oches stated he had no knowledge of the practice of paying patrol officers from the time of the assignment call prior to January 2005. Oches also testified that when he served as Deputy Chief in charge of technical services, including payroll, the first step of the grievance procedure in a payroll-related dispute should have been addressed to him, according to the CBA.

Lieutenant John Lenge, a career officer in the patrol division for approximately sixteen years, testified that when an officer was called for immediate overtime, "if an officer arrive[d] at Headquarters within a reasonable time, fifteen, twenty minutes, it's not uncommon for the officer to be paid from the starting time that he was called to arrive for." According to Lenge, an officer who was called an hour prior to the start of his shift was required to arrive at headquarters on time. Officers who arrived late for their regular shifts were routinely clocked in as on time, even though they were late.

Township Administrator Czech testified that he refused to implement Pollinger's grievance response because it was contrary to the CBA and outside of Polliger's authority. Czech believed that only he had the authority to negotiate contracts for the Township, which then had to be ratified by resolution of the Township Committee. Czech stated that the CBA contained no travel time provision because it had not been bargained for, and the Chief could not unilaterally create such a provision. Czech stated that he had no personal knowledge of the alleged practice prior to the filing of the PBA grievance.

Czech identified Deputy Chief Braun as the officer then in charge of Uniform Services including the patrol division. Braun did not testify at the hearing.

On June 6, 2006, the hearing examiner issued her report and recommended decision in which she found that for the past twenty-five years, the Township had a practice of compensating patrol officers for reasonable shape-up or travel time when called for immediate overtime. Therefore, the hearing examiner concluded that the Township violated N.J.S.A. 34:13A-5.4(a)(1) and (5) by "unilaterally discontinu[ing] payment to patrol officers for a reasonable amount of shape-up or travel time when called for immediate or emergent overtime, and fail[ing] to implement the . . . decision of Chief Pollinger."

On September 28, 2006, PERC issued a final decision adopting the fact findings of the hearing examiner. PERC held that under N.J.S.A. 34:13A-5.3, the Township was required to negotiate with the PBA in good faith before changing the longstanding practice of compensating patrol officers for a reasonable amount of shape-up or travel time when called for immediate overtime. PERC further found that the Township was not required to implement Pollinger's grievance resolution because the PBA had eliminated the first step of the grievance procedure set forth in the CBA by failing to file its grievance with then-Deputy Chief Czech.

PERC ordered the Township to "[r]estore the practice of compensating patrol officers for a reasonable period of shape-up or travel time, not to exceed one hour, when called for emergent or immediate overtime." PERC also ordered the Township to "[n]egotiate in good faith with PBA Local 124 over any proposed change to or elimination of compensation to patrol officers for shape-up or travel time associated with emergent or immediate overtime."


Appellate courts "grant administrative agency action a 'strong presumption of reasonableness.'" Aqua Beach Condo. Ass'n v. Dep't. of Cmty. Affairs, 186 N.J. 5, 16 (2006)(quoting Newark v. Natural Res. Council, 82 N.J. 530, 539 (1980)). Our review of administrative agency actions is limited and focuses on three inquiries: whether the action was arbitrary, capricious, or unreasonable; whether there is evidence in the record to support the agency's findings; and whether the action violates any legislative policy. Ibid. Factual findings are binding on appeal when supported by "adequate, substantial and credible evidence." In re Ocean Cty. College, 204 N.J. Super. 24, 39 (App. Div.), certif. denied, 102 N.J. 327 (1985). "The reviewing court also gives due regard to the ability of the fact finder to judge credibility and, where the agency's expertise is a factor, to that expertise." Ibid.

Under N.J.S.A. 34:13A-5.2, PERC is empowered to "make policy and establish rules and regulations concerning employer-employee relations in public employment relating to dispute settlement, grievance procedures and administration including . . . to implement fully all the provisions of [the] act." As the Supreme Court has recognized, this broad grant of statutory authority requires particular deference by a reviewing court.

[T]he judicial role in this kind of case must be both sensitive and circumspect. We deal here with the regulatory determination of an administrative agency that is invested by the Legislature with broad authority and wide discretion in a highly specialized area of public life. . . . The[] manifestations of legislative intent indicate not only the responsibility and trust accorded to PERC, but also a high degree of confidence in the ability of PERC to use expertise and knowledge of circumstances and dynamics that are typical or unique to the realm of employer-employee relations in the public sector.

Although constitutional concerns or the dictates of legislative intent have at times compelled us to decline adoption of doctrines or statutory interpretations that have been favored by PERC, in the absence of such constraints, and particularly in situations where agency expertise is essential towards understanding the proper context of a dispute, a deferential standard of review is appropriate.

The Legislature has authorized PERC to determine in the first instance whether or not a "matter in dispute is within the scope of collective negotiations." . . . [T]he scope of our review of PERC's factual determinations is limited; the evaluation of evidence is the province of PERC rather than of the courts, and when these determinations fall within PERC's special sphere of expertise, we accord them due weight. [In re. Hunterdon Cty. Bd. of Chosen Freeholders, 116 N.J. 322, 328-29 (1989)(citations omitted).]

With that standard of review in mind, we address the Township's contentions.

N.J.S.A. 34:13A-5.4(a)(5) provides: "Public employers, their representatives or agents are prohibited from . . .

[r]efusing to negotiate in good faith with a majority representative of employees in an appropriate unit concerning terms and conditions of employment of employees in that unit, or refusing to process grievances presented by the majority representative." The party claiming a violation of this statute has the burden of proving the allegations by a preponderance of the evidence. N.J.A.C. 19:14-6.8.

PERC found that there was an established past practice of paying patrol officers called in for immediate overtime for their shape-up or travel time:

In this case, the overwhelming weight of the evidence proves that for 25 years, patrol officers have been paid for shape-up or travel time when called for emergent or immediate overtime. We disagree with the Township that shape-up or travel time is a new term and condition of employment that could only be established through negotiations involving the township council. Police Officers called in on overtime have historically been paid from the beginning of a shift even if they arrive a reasonable amount of time after the shift begins. The Township acknowledges that officers in the detective and traffic divisions are compensated for shape-up/travel time despite the lack of any authorizing ordinance or contract language. We reject the argument that a working condition such as this cannot be established by a police chief, deputy chief of police, or shift commander in charge of a shift of patrol officers. If the leadership of the township's police department has treated its patrol officers the same way it treats its detectives and traffic officers, the Act requires that the township take certain steps before changing that treatment. . . . [W]e are not holding that the PBA had a contractual right to have the practice maintained, but if the township wished to make a change, it had to negotiate with the PBA in good faith.

Shape-up/travel time after an officer is called in on overtime is not specifically addressed by the parties' contract. It could have been, as evidenced by the blue and white collar negotiations unit contracts that do so. But it was not. Instead, there was a practice of paying patrol officers from the time a shift began, subject to a reasonableness limitation.

. . . [T]he witnesses who testified about the practice painted somewhat different versions of the same past practice picture. However, we reject any suggestion that because one witness testified that the practice was up to one-half hour, and others testified that it was up to an hour, we should find that there was no established practice at all. The Hearing Examiner found, and we agree, that the testimony, viewed as a whole, establishes that officers received a reasonable amount of shape-up/travel time and that one hour was the outer limit of reasonableness.

Under these circumstances, paid shape-up/travel time was an established working condition and the employer had an obligation to negotiate before changing that working condition.

We conclude that "substantial credible evidence supports" PERC's decision. Aqua Beach Condo. Ass'n, supra, 186 N.J. at 16. The testimony of seven police officers established a twenty-five-year history of the overtime pay practice.

PERC also properly rejected the PBA's argument that overtime pay is dispositively addressed in Article XI of the CBA. That document is silent on the matter of whether officers are entitled to travel or shape-up pay when called in for overtime. The relevant portion of the CBA states:


A. The Employer agrees that overtime consisting of time and one-half (1 1/2) shall be paid to all employees for hours worked in excess of the normal work day of eight (8) hours and for any normal work week in a seven day period or more than forty (40) hours.

B. Employees shall not be paid overtime for hours of work in excess of the normal day unless such overtime is authorized by the Chief of Police or the supervisor in charge of the shift.

D. In the event any employee is called in to duty other than for his normal assignment, he shall be paid overtime at time-and-one half (1.5) for all the time worked during each period, but in no case shall he be paid less than four (4) hours at this rate, for each call in.

Where, as here, "contract terms are unspecific or vague, extrinsic evidence may be used to shed light on the mutual understanding of the parties." Hall v. Bd. of Educ. of Jefferson, 125 N.J. 299, 305 (1991). "The past practice of the contracting parties is entitled to great weight in determining the meaning of ambiguous or doubtful contractual terms." Id. at 306 (citation omitted).

The Township asserts that the term "worked" within that CBA provision means "entitled to pay only upon reporting to [the] job location and commencing 'work.'" However, PERC interpreted Article XI of the CBA as neither granting nor prohibiting the practice of paying shape-up or travel time.

We do not find this interpretation to be arbitrary, capricious, or unreasonable. The evidence presented at the hearing established, and the Township had stipulated, that it paid traffic officers and detectives who are covered by the same CBA for shape-up or travel time. Therefore, based upon this mutually acknowledged practice, PERC's interpretation was reasonable.

Nor does PERC's decision impose a "binding contract term" as the Township contends. As noted, PERC is charged with determining "in the first instance whether or not [the] 'matter in dispute is within the scope of collective negotiations.'" In re Hunterdon Bd. of Chosen Freeholders, supra, 116 N.J. at 328 (quoting N.J.S.A. 34:13A-5.4(d)).

PERC carried out this particular function here. Based upon the evidence, PERC determined that "paid shape-up/travel time was an established working condition and the employer had an obligation to negotiate before changing that working condition." Therefore, PERC ordered the Township to "[n]egotiate in good faith with PBA Local 124 over any proposed change to or elimination of compensation to patrol officers for shape-up or travel time associated with emergent or immediate overtime."

The Township's argument that this past practice is invalid because it never received "formal approval by the Governing Body[,]" misses the point, as evidenced by the Township's reliance upon In re Grievance of Transportation Employees, 120 N.J. Super. 540 (App. Div. 1972), certif. denied, 62 N.J. 193 (1973). In that case, we held that the Commissioner of the Department of Transportation (DOT) was not bound by a past practice under which certain DOT employees were only required to work thirty-five hours per week rather than the forty hours per week required by a Civil Service Commission regulation, even though that practice had been approved by lower level DOT officials. Id. at 544-45. The Civil Service regulation had the force of law under N.J.S.A. 11:14-1 (repealed by N.J.S.A. 11A:12-3 (1986)), which provided: "The Chief Examiner and Secretary [of the Civil Service Commission] shall, after consultation with the heads of department and their principal assistants, prepare, and after approval by the commission, administer regulations regarding . . . hours of work[.]"

No comparable administrative regulation, law or ordinance is involved here. Moreover, the appeal in Transportation Employees did not involve, as this case does, claims under the Employer-Employee Relations Act.

N.J.S.A. 34:13A-5.3 requires a public employer to negotiate conditions established by past workplace practices prior to changing any non-contractual employment conditions. This duty prohibits an employer from instituting unilateral, mid-contract changes in any conditions established by such past practices. Bd. of Educ. of Neptune Twp. v. Neptune Twp. Educ. Ass'n, 144 N.J. 16, 22 (1996). The remedy for a failure to negotiate prior to instituting a mid-contract change is to restore and maintain the status quo until negotiations have been held and an agreement reached. Galloway Twp. Bd. of Educ. v. Galloway Twp. Educ. Ass'n., 78 N.J. 25, 48-49 (1978).

The Township found itself in a similar position in earlier litigation with the PBA. Twp. of Middletown v. Middletown PBA Local 124, 334 N.J. Super. 512 (App. Div. 1999), aff'd, 166 N.J. 112 (2000). In that case PERC found that the Township had violated its duty to negotiate pursuant to N.J.S.A. 34:13A-5.3 when it unilaterally changed a practice relating to initial salary guide placement. Id. at 516 The Township appealed, arguing that no violation of the duty to negotiate could be found unless the CBA mandated, either expressly or implicitly, that the practice continue. However, we held that the "question is not whether the Township is bound by an existing employment condition, but whether that employment condition has been changed." Id. at 515. We found such a change to have occurred and required the Township to restore its practice and negotiate the issue prior to any further changes. Id. at 516.

The same situation appertains here. PERC's decision to require the Township to restore the past practice of shape-up/travel time pay and to negotiate with the PBA before terminating that practice, was not arbitrary, capricious, or unreasonable.


We now address the PBA's cross-appeal. We find that PERC's decision on this issue "is supported by sufficient credible evidence on the record as a whole[.]" R. 2:11-3(e)(1)(D). We concur with PERC's rationale that if the PBA had filed its grievance at step one with the then-deputy chief, the person who later objected to the chief's grievance determination, the Township would have been on notice of this issue and would likely have intervened and sought to prevent the chief from sustaining the grievance. We also believe that if the PBA had served a copy of its grievance on the business administrator, he also would likely have intervened. Instead, the administrator first learned of the grievance after the chief had sustained it. Under these circumstances, we are not convinced that the Township repudiated or flouted the parties' grievance procedure in violation of its obligation to negotiate in good faith. The parties negotiated a procedure that would have protected against the chief acting without administration knowledge and that procedure was apparently not followed. Accordingly, under the particular circumstances of this case, we dismiss the allegation that the Township violated the Act by not complying with the chief's grievance determination.

The determination of whether a party to a CBA has complied with the grievance procedure set forth therein, and the consequences of a failure to comply with those procedures, are matters particularly within PERC's expertise, to which we extend substantial deference. Hunterdon Cty. Bd. of Chosen Freeholders, supra, 116 N.J. at 328. Because the PBA did not properly serve its grievance upon the appropriate parties and Pollinger made his decision before the Township Administrator became aware of the grievance, PERC's decision to dismiss that grievance was proper.


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