PERC Decision Impacts Health Benefit Contract Negotiations

Posted · Add Comment

By Jennifer Keyes-Maloney

A recent decision by the Public Employment Relations Commission (PERC) delays when bargaining groups can negotiate their contribution toward their health insurance premiums till the actual expiration or sunset of the law (P.L.2011, c.78) that required employees pay a  percentage of the cost of the premium associated with the benefit received.

The Facts

The case came before PERC from a proposal made by the Clementon Education Association (CEA) during negotiations for a successor agreement with the Clementon Board of Education.  The CEA proposal sought to reduce the employee share of health benefits contribution to 1.5% of base salary after the four year implementation required by P.L.2011, c.78.

P.L.2011, c.78 increased employee health care contributions over four years from 1.5 percent of their pay (required under a 2010 law) to between 3 percent and 35 percent of their health care premium, depending on a worker’s salary.

There was a question, however, as to how long the public workers would be required to make the higher health premium contribution — and when the issue could be returned to the bargaining table.

Last year, the Clementon Board of Education asked PERC to weigh in on a dispute. The district was not only in the final year of the four-year phase-in of higher health insurance contributions but was also preparing for the first year of a new contract. The CEA argued that after four years, health benefits should be back in play at the bargaining table. The school district said they should remain in place until the next round of contract talks.

The Decision

PERC agreed with the school board ruled that the union can’t yet negotiate premium contributions.

PERC in its decision, concluded that negotiations regarding health benefits contributions were preempted byN.J.S.A. 18A:16-17.2. for the duration of any agreement that was ratified while the law’s four your ramp up was ongoing.  The decision also stated that while health benefits contributions were negotiable in successor agreements, the full implementation levels served as the status quo.

Higher contributions levels were set to end this year in about a third of school districts statewide, according to a statement by the New Jersey School Boards Association