SUPERIOR COURT OF NEW JERSEY

APPELLATE DIVISION DOCKET NO. A-1340- 22
POLICEMEN'S BENEVOLENT ASSOCIATION LOCAL NO. 260, Plaintiff-Respondent,

v. TOWNSHIP OF PEMBERTON and TOWNSHIP OF PEMBERTON POLICE DEPARTMENT, Defendants-Appellants.

______________________________

Submitted January 22, 2024

– Decided February 7, 2024 Before Judges Marczyk, Chase, and Vinci. On appeal from the Superior Court of New Jersey, Law Division, Burlington County, Docket Nos. L-0 102 -22 and L-0 108

- 22. Capehart & Scatchard, PA, attorneys for appellants (Carmen J. Sanginario, of counsel and on the brief)

. Sciarra & Catrambone, LLC, attorneys for respondent (Christopher A. Gray, of counsel and on the brief; Frank Carmen Cioffi, on the brief).

NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION This opinion shall not "constitute precedent or be binding upon any court. " Although it is posted on the internet, this opinion is binding only on the parti es in the case and its use in other cases is limite d. R. 1:36- 3.2 A- 1340

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PER CURIAM Defendant the Township of Pemberton ("the Township") appeals fro m the Law Division's December 5, 2022 order denying th eir order to show cause seeking to set aside an arbitration award and a cor responding confirmation of such award in favor of the plaintiff Policemen's Be nevolent Association Local 260 (" PBA ")

. The arbitration resolved a grievance the PBA filed over the Township's obligation to pay the health care expenses of certa in retirees under the 2018- 202 1 collective negotiation agreement ("the CNA"). We affirm. The PBA is a labor organization representing police officers employed by and retired from the Township. The parties entered into multiple labor agreements over the years. Under an agreement span ning from 2007-2009, the
T ownship provided "major medical, hospitalization, and prescription drug insurance benefits," and provided retired employees "with continued health benefits . . . [to] cover the employee only at the single person rate." The parties' 2010- 2013 1 agreement modified this language to acknowledge the June 2011 passage of P.L. 2001, c. 78 ("Chapter 78"), which amended the law on public employee health insurance contributions. The law

1 While the 2010-2013 agreement covered dates prior to the law's passage, it was executed after the law went into effect.3 A- 1340

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required public employees to contribute defined per centages of their health care benefit premiums based on annual income. N.J.S.A. 52:14 -17.28(c). The Chapter 78 reforms created N.J.S.A. 40A:10 -21.1, which phased in the public employees' contributions in four tiers o ver four years. The statute required employees to pay "one-fourth of the . . . contribution" during the first year (tier one), "one-half" in the second year (tie r two), and "three-fourths" during the third year (tier three). N.J.S.A. 40A:10 -21.1(a)

. Tier four, the full premium rate, wa s reached by the fourth year. Ibid. No matter the percentage dictated by the employee's salary or the proportion dictated by the tier, the law required the contribution by current employees "sha ll not under any circumstance be less than the 1.5 percent of [the e mployee's] base salary . . . ." Ibid. Retirees with twenty years or more of creditable se rvice as of June 28, 2011, were exempted from payment. N.J.S.A. 40A:10 -21.1(b)(3). Chapter 78's "sunset" provision provide d that N.J.S.A. 40A:10 -21.1 would "expire four years after the effective date," on Ju ne 28, 2015. In turn, N.J.S.A.
40A:10 -21.2, also created by Chapter 78, governs CNAs exe cuted after full implementation of the tier four rates under 40A:10 -21.1(a)

. It provides that "[a]fter full implementation, those contribution le vels . . . shall then be subject to collective negotiations" and parties to a CNA "s hall . . . negotiat[e] . . . for4 A- 1340

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health care benefits as if the full premium share w as included in the prior
contract." N.J.S.A. 40A:10 -21.2

. The labor agreement at issue in the present dispute spans from January 1,
2018 , through December 31, 2021. The CNA is a successo r 2 to the 2010-2013 agreement. In language largely mirroring the 2010- 2013 agreement, Article X, Section A, Paragraph Four of the CNA provides the f ollowing for active employee health benefits:

E ligibility for medical benefits is dependent upon an employee's permanent full-time status with the Township (regularly scheduled to work an average of 35 or more hours per week). Employees electing benefits under this plan shall be required to pay contributions based on a percentage of the cost of coverage as set forth in [Chapter 78], subject to a ny right which may exist in the future to negotiate contributions . . . . Article X, Section A, Paragraph Five of the CNA, ad dressing retiree benefits, provides, "[t]he Township will assume the cost of health benefits coverage and pay all premiums for [eligible retiree s], . . . at the 'single' level of coverage." (emphasis added). It goes on to state, "reti rees will receive the same health benefits and under the same terms and condit ions as current active

2 Nothing in the record indicates the existence or terms of an agreement covering the dates between the December 2013 expira tion of the prior agreement and the January 2018 effective date of the subject CNA.5 A- 1340

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employees." (emphasis added). The Township constr ued this "same terms and conditions" language to require retirees to contrib ute along Chapter 78 rates because active employees were required to do the sa me, and the Township charged retirees for benefits contributions accordi ngly. In August 2020, the PBA filed a grievance against t he T ownship, challenging its practice of requiring retirees to c ontribute to their healthcare coverage as a violation of the terms of the CNA. T he PBA then submitted a request to the New Jersey Public Employment Relatio ns Commission for arbitration. The parties agreed the arbitrator wou ld decide the narrow issue of whether the Township violated Paragraph Five of the CNA when it charged eligible retirees for healthcare contributions. Bo th parties presented witness testimony and documentary evidence. On October 27, 2021, the arbitrator issued a writte n opinion and award in the PBA's favor, finding the unambiguous language o f the CNA to require the
T ownship to assume the entire cost of eligible retirees' health benefits premiums. She ordered the Township to cease collecting contri butions from those retirees "unless and until provisions in a successor collect ive bargaining agreement dictate otherwise." She also ordered the T ownship to reimburse those retirees erroneously charged.6 A- 1340

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In January 2022, the PBA filed a verified complaint to confirm the award, and the T ownship filed a verified complaint to vacate, modify, or otherwise correct the award. The cases were consolidated bel ow . The court agreed with the PBA's position that the arbitrator 's conclusion was "reasonably debatable," and issued an order confirming the arbitration awar d. The Township contends the trial court erred by conf irming the arbitrator's decision as "reasonably debatable" because of the C NA's clear and unambiguous language and extrinsic evidence of the parties' int ent. It also argues that the award is contrary to existing law and public policy . We disagree with both propositions. Generally, "[j]udicial review of an arbitration awa rd is very limited." Bound Brook Bd. of Educ. v. Ciripompa, 228 N.J. 4, 11 (2017) (quoting Linden Bd. of Educ. v. Linden Educ. Ass'n ex rel. Mizichko, 202 N.J. 268, 276 (2010)). "The public policy of this State favors arbitration as a means of settling disputes that otherwise would be litigated in a court." Badiali v. N.J. Mfrs. Ins. Grp., 220
N.J. 544, 556 (2015) (citing Cnty. Coll. of Morris Staff Ass'n v. Cnty. Col l. of Morris, 100 N.J. 383, 390 (1985) ). "[T]o ensure finality, as well as to secure arbitration's speedy and inexpensive nature, there exists a strong preference for judicial confirmation of arbitration awards." Borough of E. Rutherford v. E.7 A- 1340

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Rutherford PBA Local 275 , 213 N.J. 190, 201 (2013) (alteration in original) (quoting Middletown Twp. PBA Local 124 v. Twp. of Middletown, 193 N.J. 1,
10 (2007) ). A trial court's decision to confirm an arbitration award is a conclusion of law which we review de novo. Minkowitz v. Israeli, 433 N.J. Super. 111, 136 (App. Div. 2013) . Similarly, we "review the trial court's decision on a motion

to vacate an arbitration award de novo." Yarborough v. State Operated Sch. Dist. of City of Newark, 455 N.J. Super. 136, 139 (App. Div. 2018) (citing Minkowitz, 433 N.J. Super. at 136 ). We are bound to accept the trial court's factual findings unless "clearly erroneous." Del Piano v. Merrill Lynch, Pierce, Fenner & Smith, Inc., 372 N.J. Super. 503, 507 (App. Div. 2004) (citing First Options of

Chicago, Inc. v. Kaplan, 514 U.S. 938, 947

- 48 (1995) ). Therefore, "an arbitrator's award resolving a publi c sector dispute will be accepted so long as the award is 'reasonably debatabl e.'" Borough of Carteret v. Firefighters Mut. Benevolent Ass'n, Local 67, 247 N .J. 202, 211 (2021) (quoting Borough of E. Rutherford, 213 N.J. at 201

- 02 )). "Under the reasonably debatable standard, a court reviewing [a public -sector] arbitration award 'may

not substitute its own judgment for that of the arbitrator, regardless of the court's view of the correctness of the arbitrator's position.'" Id. at 201- 02 (alteration in8 A- 1340

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original) (quoting Middletown Twp. PBA Local 124 , 193 N.J. at 11 ). "If the

correctness of

the award, including its reso lution of the public-policy question, is reasonably debatable, judicial intervention is unwarranted." Weiss v. Carpenter, Bennett & Morrissey, 143 N.J. 420, 443 (1996). However, vacatur may be proper "when it has been shown that a s tatutory basis justifies that action." Ciripompa , 228 N.J. at 11 (quoting Kearny PBA Loc. #21 v. Town of Kearny, 81 N.J. 208, 221 (1979) ). The statutory bases for vacatur include, "[w]here the award was procured by corruption, fraud[,] or undue means . . . [or] [w]here the arbitrators were guilty of misconduct . . . in refusing to hear evidence, pertinent and material t o the controversy . . . ." Ciripompa, 228 N.J. at 12 ( quoting N.J.SA. 2A:2 4-8). "'[U]ndue means' ordinarily encompasses a situation in which the arbitrator has made an acknowledged mistake of fact or law or a mistake that is apparent on the face of the record . . . ." Boroug h of E. Rutherford, 213 N.J. at 203 (quoting N.J. Off. of Emp. Rels. v. Commc'ns Wo rkers of Am., 154 N.J. 98, 111 (1998)). See also Middletown Twp. PBA Local 12 4, 193 N.J. at 11 (holding awards contrary to existing law or public policy ma y be vacated as procured by undue means).9 A- 1340

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To the extent review of an arbitral award for agree ment with law or public policy involves statutory interpretation, such a review is de novo and the court's "paramount goal" is to discern the Legislature's in tent. In re Ridgefield Park Bd. of Educ., 244 N.J. 1, 18 (2020) (quoting DiPros pero v. Penn, 183 N.J. 477, 492 (2005)). The Township argues the arbitrator improperly ignor ed the unambiguous language of the contract holding retirees subject t o the same terms and conditions of coverage that applied to active emplo yees. The Township also argues the arbitrator ignored the evolution of the language in the parties' agreements over time, which indicated an intent to be bound by Chapter 78 and its mandatory contribution levels. The PBA responds that the arbitrator's interpretati on of the contract met the "reasonably debatable" standard, and the trial court was correct to confirm it. We agree. Because the arbitrator found the contract language to unambiguously require the Township to pay retirees' benefits, she was not required to consider extrinsic evidence of the parties' past practices. The interpretation was justifiable , supported by the record, and mee ts the "reasonably debatable" standard. We see no reason to substitute our interpretation for that of the10 A- 1340

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arbitrator. When a CNA provides for the resolution of disputes through binding arbitration, "the arbitrator's construction . . .is bargained for, an d not a court's . . . ." Policemen's Benevolent Ass'n, Local No. 11 v. City of Trenton, 205 N.J. 422, 429 (2011) ( quoting Linden Bd. of Educ. v. Linden Educ. Ass'n ex rel. Mizichko, 202 N.J. 268, 276 (2010)). Next, the Township argues the award violates public policy as clearly expressed in law. Because Chapter 78 was enacted t o provide tax relief for the State's citizens, the T ownship reasons the arbitral award entirely relieving retirees of contribution obligations is contrary to its clearly stated public policy.
But the relevant CNA provision, and the effect upon retirees, is neither unlawful

nor contrary to a clear mandate of public policy. Rather it is a negotiable item. Chapter 78 established a staggered timeline to phas e in employee health care contributions. By its very terms, once the fo urth tier or "full premium" contribution level was reached, the future contribu tion levels became a negotiable component of subsequent CNAs. N.J.S.A. 40A:10-21.2

. Here, tier four was reached in 2015. This 2018-2021 CNA was e xecuted well after full implementation, when the parties were free to negot iate downwards from the earlier tier four contribution level. N.J.S.A. 40A :10-21.2. The statute specifies that although some sections would outlive the four- year expiration, those11 A- 1340

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surviving sections would only remain "alive" until the tier four contribution level was reached:

A public employer and employees who are in negotiations for the next [CNA] to be executed afte r the employees in that unit have reached full implementation of the premium share set forth in [Chapter 78] shall conduct negotiations concerning contributions for health care benefits as if the fu ll premium share was included in the prior contract. The public employers and public employees shall remain bound by the provisions of [Chapter 78] , notwithstanding the expiration of those sections, until the full amount of the contribution required by [Chapter 78] has been implemented . . . . [N.J.S.A. 40A:10 -21.2 .]

Contribution levels were fully negotiable for any C NA executed after 2015 when full implementation of the tier four rates was comp lete. See In re Ridgefield Park Bd. of Educ., 244 N.J. at 25 ("the Legislature envisioned that the transitio n between Tier four health insurance premium contribu tion rates set by Chapter 78 and contribution rates negotiated by [public emp loyers] and employees would take place in the negotiations for the next C NA . . ."). Nor does our reading of the statute establish enforcing the awar d would be contrary to public policy or counter to the legislative history and in tent of Chapter 78 in aiding local governments in reducing the line item for emp loyees' health benefit12 A- 1340

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premiums. It created a category of employees for w hom the parties could negotiate the contribution rate, and a timeframe in which such negotiations were permitted. The statute expressly contemplated that these items would be negotiated through successor CNAs, as was the case here. The arbitrator's award was reasonably debatable and not in conflict with publi c policy, and the trial court was correct to confirm it. To the extent we have not expressly addressed any i ssues raised by defendants, it is because they lack sufficient meri t to warrant discussion in a written opinion. R. 2:11

- 3( e)(1)(E). Affirmed.