SUPERIOR COURT OF NEW JERSEY

APPELLATE DIVISION

DOCKET NO. A-3228-17T4

WEST ESSEX PBA LOCAL 81

(WEST CALDWELL UNIT),

Plaintiff-Respondent,

v.

TOWNSHIP OF WEST CALDWELL,

Defendant-Appellant.

__________________________________

Argued October 16, 2018 – Decided

Before Judges Yannotti, Rothstadt and Natali.

On appeal from Superior Court of New Jersey, Law 

Division, Essex County, Docket No. L-7649-17.

Angelo J. Genova argued the cause for appellant 

(Genova Burns LLC, attorneys; Angelo J. Genova and

Joseph M. Hannon, of counsel and on the briefs; Ryann 

M. Aaron, on the briefs).

Leonard C. Schiro argued the cause for respondent 

(Mets, Schiro & McGovern, LLP, attorneys for 

respondent; Leonard C. Schiro, of counsel and on the 

brief; Julian N. Krol and Ryan E. Ross, 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NOT FOR PUBLICATION WITHOUT THE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 parties in the case and its use in other cases is limited. R. 1:36-3.

November 26, 2018
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PER CURIAM

The Township of West Caldwell appeals from an order entered by the Law 

Division on February 21, 2018, which vacated an arbitration award and found 

that Sergeant Daniel Gorman was entitled to an additional $14,185.61 in 

terminal leave payments for vacation and sick leave. We affirm. 

I. 

The Township and West Essex PBA Local 81, West Caldwell Unit (PBA),

are parties to a collective negotiations agreement (CNA), which is effective from 

January 1, 2015, through December 31, 2019. Article V of the CNA governs 

vacation and holiday time. It states, in pertinent part, that an employee covered 

by the agreement "shall receive vacations" based on the length of the employee's 

service. An employee who has served between fifteen to nineteen years receives

200 hours of vacation time. The CNA does not, however, address how an 

employee accumulates vacation leave if the employee retires or is separated 

before the end of a calendar year.

Article XIII of the CNA governs sick leave. It provides that an employee

covered by the agreement shall receive a specified number of hours of sick leave, 

based upon the date the employee was hired. Section A of Article XIII states 

that "[a]ny unused sick leave days will be accumulated and compensated to the 
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[e]mployee at the rate of fifty percent (50%) as terminal leave at the time of 

retirement or by virtue of work-connected disability-causing separation."

Section C of Article XIII permits an officer to use as personal days up to two 

eight-hour shifts or two twelve-hour shifts from his or her total annual sick leave 

allotment. Section C also states that "[a]t the time of separation or retirement, 

the accumulated terminal leave to which an [o]fficer is entitled pursuant to 

Section A herein shall be reduced by one-half . . . day for each personal day 

used." 

It is undisputed that from at least 2006 until January 2015, the Township

did not prorate the vacation time earned if an employee retired or was separated 

before the end of the calendar year. It is also undisputed that before January 

2015, the Township calculated the employee's terminal sick leave payment by 

first determining the total accumulated sick leave hours, and deducting one-half 

of the hours of the personal sick leave the employee used during his or her 

employment. The Township then reduced that number by fifty percent and 

applied the employee's final hourly rate of pay to arrive at the terminal sick leave 

payout. 

On January 15, 2015, the Township adopted and issued a "Personnel 

Policies and Procedures Manual/Employee Handbook" (Handbook), which 
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provides in pertinent part that "[v]acation time is credited at the beginning of 

the calendar year, in anticipation of continued employment for the remainder of 

the year (it shall be accrued proportionally throughout the year)." The 

Handbook states that "[d]uring the final year of employment, an employee may 

take his/her full (or prorated share) vacation entitlement or may elect to receive 

payment in lieu of time off." 

In January 2015, Township Administrator Adam W. Brewer held a 

meeting with all municipal staff, including members of the police department,

and explained certain provisions of the Handbook. Brewer addressed the change 

in the manner in which vacation time accrues in the last year of employment. 

Brewer testified that at the meeting, Gorman asked him whether the Handbook

applied to all of the Township's employees. Brewer responded by saying the 

Handbook applied to all employees, but the CNA would apply to all employees

covered by the agreement in the event of a conflict.

In 2015, the Township also changed the method for calculating the 

terminal sick leave payments. According to Nikole Monroig, the Township's 

Chief Financial Officer and Assistant Administrator, certain Township officials

reviewed the CNA and concluded that the method the Township had been using
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to calculate the terminal sick leave payments was based on an erroneous 

interpretation of the contract. 

The Township decided to calculate the terminal leave payments for sick

time by taking the total number of hours of unused sick time the employee had 

accrued, and reducing that number by half. From that number, the Township 

would deduct one-half of the hours of personal sick leave the employee had used 

during his or her employment. The Township then would multiply that number 

by the employee's hourly rate of pay to arrive at the amount of the employee's 

terminal sick leave payout. 

The Township applied its new calculation method for terminal vacation 

leave payouts to John Kopf and William Coughlin, two members of the PBA's 

bargaining unit who submitted retirement papers after January 15, 2015. In 

2015, the Township also applied the new calculation method for the terminal 

sick leave payouts to Kopf, Coughlin, and William Styskal, another member of 

the PBA bargaining unit. The PBA did not object to the terminal leave payments

for these employees. 

Gorman retired from the Township's police department, effective July 1, 

2016. The Township calculated Gorman's vacation leave for 2016 in accordance 

with the new methodology. The Township prorated his 200 hours of vacation 
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time for 2016, and determined that Gorman was entitled to 100 hours for that 

year, and 37 hours of vacation leave which he carried over into 2016. 

The Township also calculated Gorman's sick leave payout in accordance 

with its new policy. It determined that as of June 30, 2016, Gorman had 

accumulated a total of 329.50 hours of unused sick time. The Township divided 

that number in half, arriving at 164.75 hours. Gorman had used 444 hours of 

personal sick time during his employment. The Township subtracted half of that 

number, 222 hours, from 164.75 hours, leaving a negative balance of 57.25

hours.

The PBA disputed the Township's calculations. It calculated Gorman's 

vacation and sick time payments in accordance with the policies that had been 

in effect until January 2015. The PBA asserted that Gorman was entitled to the 

full allotment of 200 hours for 2016, along with the 37 hours he carried over 

from 2015, for a total of 237 hours of vacation time. In addition, the PBA

calculated Gorman's sick leave payout by deducting half of his unused personal 

sick leave, 222 hours, from the sick leave balance of 329.50 hours, yielding 

107.50 hours. The PBA asserted that Gorman was entitled to payment for onehalf of that number, or 53.75 hours. 
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II. 

On June 23, 2016, Gorman filed a grievance with Chief of Police Gerard 

Paris on behalf of himself and the PBA. Gorman alleged the Township violated 

the CNA by calculating his retirement payments for vacation and sick leave in 

accordance with the new policies adopted in 2015. The Chief of Police denied 

the grievance on June 24, 2016. Thereafter, Gorman filed grievances with the 

Township's Administrator, Mayor, and Council. The grievances were denied. 

In August 2016, Gorman and the PBA submitted the grievance to the New 

Jersey Public Employment Relations Commission (PERC) for binding 

arbitration. An arbitrator was selected and directed to decide whether the 

Township appropriately calculated Sergeant Daniel Gorman's vacation and sick 

leave payouts in accordance with the CNA, Township handbook, and/or past 

practices. 

In January 2017, the arbitrator conducted a hearing in the matter. 

Thereafter, the arbitrator issued a written decision denying the grievance. The 

arbitrator found the CNA did not explicitly address the manner in which 

vacation leave is accumulated in the last year of employment. The arbitrator 

noted that for many years, members of the PBA bargaining unit had received a 

full allotment of annual vacation leave in the final year of employment, even 
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though the employee retired before the end of the calendar year. The arbitrator 

found that the Township had changed that policy on January 15, 2015, when it 

issued the Handbook, and thereafter applied its new policy to Kopf and 

Coughlin. The PBA did not object to the change, and it did not file any 

grievances for the employees whose vacation leave payouts were affected by the 

change.

The arbitrator also found that the CNA was ambiguous and did not 

expressly require the Township to calculate sick leave payouts for retirees in 

accordance with its past practice. The arbitrator observed that in 2015, the 

Township had changed the manner in which it calculates payouts and applied 

that change to Kopf, Coughlin, and Styskal. The arbitrator noted that the PBA 

did not object to the sick leave payouts for these employees. 

The arbitrator concluded that the Township had appropriately calculated 

Gorman's retirement payments for vacation and unused sick leave. The 

arbitrator found that when Gorman retired in 2016, the Township's past practices 

of calculating these payments were no longer in effect. The arbitrator also found 

the Township had consistently followed its new policies without any objection 

from the PBA.
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In October 2017, the PBA filed a complaint in the Law Division seeking 

an order vacating the arbitration award. The Township filed an answer and 

sought an order confirming the award. In February 2018, after hearing oral 

arguments, the Law Division judge placed an oral decision on the record. 

The judge decided that the award must be vacated pursuant to N.J.S.A. 

2A:24-8(a) because the award had been procured by "undue means." The judge 

determined that the arbitrator made a mistake of law in failing to apply the 

Township's past practices for calculating Gorman's vacation and sick leave

payouts. The judge found that the Township's past practices had become part of 

the CNA, and any change in those practices was subject to good faith 

negotiations. The judge determined that the Township had not shown that the 

PBA waived such negotiations by acquiescing in the changes to the past 

practices. 

The judge entered an order dated February 21, 2017, which vacated the 

award and ordered the Township to pay Gorman $14,185.61, which is the 

difference between the amount Gorman claimed and the amount the Township 

had already paid him for terminal vacation and sick leave. This appeal followed.
10 A-3228-17T4

III. 

On appeal, the Township argues that the trial court erred by setting aside 

the arbitrator's award. The Township contends the award was based on a 

reasonably debatable interpretation of the CNA, and the arbitrator did not exceed 

his power in issuing the award. The Township further argues that the arbitration 

award was based on past practices that the Township had abrogated and the PBA 

had acquiesced in the change. The Township therefore contends that the award 

was not procured by "undue means." In addition, the Township contends the 

award does not violate public policy. 

We review a trial court's decision to affirm or vacate an arbitration award 

de novo. Manger v. Manger, 417 N.J. Super. 370, 376 (App. Div. 2010). "An 

arbitrator's award 'is entitled to a presumption of validity and the party opposing 

confirmation ha[s] the burden of establishing that the award should be vacated 

pursuant to N.J.S.A. 2A:24-8.'" Twp. of Wyckoff v. PBA Local 261, 409 N.J. 

Super. 344, 354 (App. Div. 2009) (alteration in original) (citing Jersey City 

Educ. Ass'n v. Bd. of Educ. of Jersey City, 218 N.J. Super 177, 187 (App. Div. 

1987)). 

N.J.S.A. 2A:24-8 provides that an arbitrator's award shall be vacated in 

any of the following circumstances:
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a. Where the award was procured by corruption, fraud 

or undue means;

b. Where there was either evident partiality or 

corruption in the arbitrators, or any thereof;

c. Where the arbitrators were guilty of misconduct in 

refusing to postpone the hearing, upon sufficient cause 

being shown therefor, or in refusing to hear evidence, 

pertinent and material to the controversy, or of any 

other misbehaviors prejudicial to the rights of any 

party;

d. Where the arbitrators exceeded or so imperfectly 

executed their powers that a mutual, final and definite 

award upon the subject matter submitted was not made.

"'Undue means' [under N.J.S.A. 2A:24-8(a)] 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[.]" Borough of East 

Rutherford v. East Rutherford PBA Local 275, 213 N.J. 190, 203 (2013) 

(quoting State, Office of Emp. Relations v. Commc'ns Workers of Am., 154 N.J. 

98, 111-12 (1998)). Furthermore, in a public sector arbitration, "[a] court may 

also vacate an award if it is contrary to existing law or public policy." State, 

Dept. of Corrs. v. Int'l Fed'n of Prof'l & Tech. Eng'rs, Local 195, 169 N.J. 505,

514 (2001) (citing State, Office of Emp. Relations, 154 N.J. at 112; S. Plainfield 

Bd. of Educ. v. S. Plainfield Educ. Ass'n ex rel. English, 320 N.J. Super. 281, 

288 (App. Div. 1999)).
12 A-3228-17T4

The court's role "in reviewing [an] arbitration award[] is extremely limited 

and an arbitrator's award is not to be set aside lightly." Int'l Fed'n, 169 N.J. at 

518 (citing Kearny PBA Local # 21 v. Town of Kearny, 81 N.J. 208, 221 (1979)). 

"[I]n public sector arbitration, [a] court[] will accept an arbitrator's award so 

long as the award is 'reasonably debatable.'" N.J. Tpk. Auth. v. Local 196, 

I.F.P.T.E., 190 N.J. 283, 292 (2007) (citing Bd. of Educ. of Alpha v. Alpha 

Educ. Ass'n., 188 N.J. 595, 603 (2006)). "A . . . court may not substitute its own 

judgment for that of the arbitrator, regardless of the court's view of the 

correctness of the arbitrator's interpretation." N.J. Transit Bus Operations, Inc. 

v. Amalgamated Transit Union, 187 N.J. 546, 554 (2006) (citing Int'l Fed'n, 169 

N.J. at 514).

Here, the record supports the trial court's determination to set aside the 

award pursuant to N.J.S.A. 2A:24-8(a) because the award was procured by 

"undue means." The court correctly determined that the arbitrator's 

interpretation and application of the CNA represented a clear mistake of law and 

was not reasonably debatable. As we have explained, the CNA does not address

how an employee's vacation leave is to be calculated if the employee retires or 

is separated before the end of the calendar year. In addition, the CNA explains 

the factors that will be used to determine the amount of a retiring employee's 
13 A-3228-17T4

unused sick leave, but does not detail the specific manner in which that 

calculation will be made.

It is undisputed that prior to January 15, 2015, the Township had a longstanding practice for paying employees the full allotment of vacation leave in 

the last year of employment, regardless of when the employee left employment.

Moreover, the Township had a long-standing practice for calculating the sick 

leave payouts for employees who retire. It also is undisputed that in January 

2015, the Township changed both practices and applied its new policies when 

deciding the amounts it paid Gorman for terminal vacation and sick leave. 

N.J.S.A. 34:13A-5.4(d) requires the public entity to engage in good faith 

negotiations before changing a policy or past practice on a matter within the 

scope of negotiations. It is undisputed that the terminal payments for vacation 

and sick leave are matters within the scope of negotiations. A bargaining 

representative may waive the right to negotiate, but the waiver "must be clear 

and unmistakable.'" City of Jersey City v. Jersey City Police Officers

Benevolent Ass'n, 154 N.J. 555, 577 (1998) (quoting In re North Arlington Bd. 

of Educ., H.E. No. 97-18, 23 N.J.P.E.R. ¶ 28077, 1997 N.J. PERC LEXIS 282 

at 17-18 (1997)). 
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In January 2015, the Township changed its past practices regarding the 

calculation of vacation and sick leave for retiring employees. The Township did 

not, however, engage in negotiations with the PBA on the changes. Moreover, 

neither party sought a determination by PERC that the matter was not subject to 

negotiations under N.J.S.A. 34:13A-5.4(d). See City of Jersey City, 154 N.J. at 

567-68 (noting that PERC has "the power and duty" under N.J.S.A. 34:13A5.4(d) to determine if a matter in dispute is within the scope of negotiations).

Rather, the parties agreed to submit the matter for a decision by an arbitrator.

The record supports the trial court's determination that the arbitrator made 

a mistake of law which was apparent on the face of the record. As noted, the 

arbitrator found that the Township validly implemented the change in 

calculating the vacation and sick leave payouts because it applied the change to 

employees who retired in 2015. The trial court correctly determined that the 

arbitrator erred by finding this evidence was sufficient to show that the PBA 

acquiesced in altering its long-standing practices.

As we have explained, the CNA did not expressly address the manner in

which vacation leave is calculated for a worker's last year of employment, but

the Township's past practice of allocating a full year of vacation time to such

employees was well established. In 2015, the Township applied its new policy 
15 A-3228-17T4

to two members of the PBA bargaining unit who retired, Kopf and Coughlin, 

without any objection by the PBA. The record supports the trial court's 

determination that by failing to object to the payments to these two employees, 

the PBA had not clearly and unmistakenly waived its right to negotiate the 

change in the calculation of vacation leave in the final year of employment. 

In addition, the CNA did not expressly detail the manner in which the 

Township would calculate a retiring employee's sick leave payout. However, 

the Township's past practice had been to calculate the payout by first 

determining the employee's total number of hours of unused sick time, 

subtracting one-half of the hours of the employee's used personal sick leave, and 

then applying the employee's salary to half of the remainder. 

As noted previously, in 2015 the Township implemented a new policy of 

calculating sick leave payouts, and the Township applied the new policy to three 

members of the PBA bargaining unit who retired in 2015, without objection by 

the PBA. The record supports the trial court's determination that the Township 

failed to show that the PBA's failure to object to these three payments 

constituted a clear and unmistakable waiver of its right to negotiate the change

in the manner in which the Township calculates sick leave payouts. 

Affirmed.