End Of Contract Benefit Need Not Be Permanent

The County of Hunterdon, New Jersey negotiations separate labor agreements with the Fraternal Order of Police (FOP) for bargaining units of corrections officers and deputy sheriffs. Several years ago, the FOP agreed to the County’s request to end an “incremental salary schedule” with a number of pay steps. In the most recent negotiations, the FOP sought to regain the benefit. When the County refused to agree, an interest arbitrator was called in to decide both sets of negotiations.

The Arbitrator’s award drew pieces from the proposals of both the FOP and the County. The Arbitrator awarded a three-year agreement, an incremental salary schedule with 11 steps reflecting a 13-15% salary increase over the life of the agreement, and a salary payment schedule of 25 annual payments in place 26, a provision advanced by the County. The Arbitrator also rejected the proposed salary increase advanced by the FOP.

The County challenged the Arbitrator’s awards, arguing that it did not comply with state law. An appeals court disagreed, finding the awards valid. The Court reasoned that “in his decision on each agreement, the Arbitrator explained that the award of a salary schedule with annual increments was consistent with the practice in every other county and throughout all law enforcement units. He noted that the ranks of Sheriff’s Officers and Corrections Officers in the County have been depleted by low salaries and the absence of annual increments. Furthermore, the incremental salary schedule has worked well in every county in which it was instituted to address recruitment and retention of experienced and qualified personnel to serve as Sheriff’s Officers and Corrections Officers.

“The Arbitrator also explained that he structured the salary schedule to freeze salaries for 2009 at 2008 levels and froze the first nine steps at the 2009 level for 2010 and 2011, but increased step 10 in 2011 and step 11 in 2010 and 2011. This structure permitted the cost of the salary portion of the agreement to fall within the total cost of the County’s own salary proposal.

“Our review of each award demonstrates that the Arbitrator considered each factor set forth by the Legislation for arbitration, provided an analysis of each relevant factor, and explained which factors he weighed more heavily than others. He conducted an exhaustive comparison of wages and salaries of the Sheriff’s Officers and the Corrections Officers with the wages and salaries of other employees performing the same or similar services. He considered the interests and welfare of the public to have well-trained and experienced officers performing the critical duties assigned to Sheriff’s Officers and Corrections Officers. He considered the impact of the exceedingly high turnover on both units due to the low salaries paid to Sheriff’s Officers and Corrections Officers and a salary strategy that discouraged retention of senior officers. The Arbitrator also identified other counties which had experienced similar turnover problems and noted that an incremental salary schedule reversed that trend in each county in which it was installed.

“The decision by parties to prior agreements to eliminate an incremental salary guide does not preclude one or both parties to an agreement to seek reinstatement of such a feature in a subsequent agreement. Finally, the incremental salary schedule does not prevent the County from seeking to modify the number of steps or the increments associated with each step in the course of future negotiations for future agreements.”

County of Hunterdon v. Fraternal Order of Police Lodge No. 94, 2012 WL 1987121 (N.J. Super. A.D. 2012).