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The New Jersey Supreme Court Issues Major Ruling on Civil Service Appeals

supreme-administrative-court-3565618_960_720-300x200All state employees, and the majority of state and local employees in New Jersey, are governed by the New Jersey’s civil service laws.  In the case of In the Matter Hendrickson, The New Jersey Supreme Court recently issued a landmark decision on the level of deference given by courts to decisions by administrative law judges in appeals of employer discipline by civil service employees.

 

Discipline at the Employer Level

New Jersey’s Civil Service Act and the regulations adopted by New Jersey’s Civil Service Commission govern disciplinary procedures in state government, and in the local and county governments which have adopted the civil service system.  When a civil service employee receives discipline, she will be given a Preliminary Notice of Disciplinary Action, known as a PNDA or Civil Service Commission Form 31-A.  He will then be given the opportunity for a hearing by his employer in which he can contest the charges against him, or argue that the level of discipline is too severe.  After the hearing, if the employer decides the employee was guilty of the offense charged and that discipline is warranted it will issue a Final Notice of Disciplinary Action, known as a FNDA or Civil Service Commission Form 31-B.

 

Appeals from Employee Discipline to the New Jersey Civil Service Commission

Once the employee receives her employer’s final decision on her discipline (usually through the FNDA, but in whatever form), the employee then has 20 days to appeal to the Civil Service Commission.  The Civil Service Commission will then examine the papers submitted in the appeal.  If the concerns are strictly an interpretation of law, ie., the Civil Service Act or the Commission’s regulations, it may keep the appeal itself and make a decision on the evidence submitted without a hearing.  However, typically appeals concern questions of fact.  In that case the Commission deems the appeal a “contested case” and refers it to the New Jersey Office of Administrative Law (known as the OAL) for a hearing before an administrative law judge.

The hearing held by the administrative law judge (known as an AL) is a full blown bench trial.  The ALJ will hear testimony from witnesses and review documents and other evidence.  However, the decision made by the ALJ is not a final decision.  Rather, it is a recommended decision to the Civil Service Commission.  The Commission can then either adopt it, reject it, or modify the ALJ’s decision.  The Commission has to give deference to the ALJ’s findings of fact because the ALJ actually observed the witnesses’ testimony and could therefore judge their credibility, and reviewed the documents.  However, because the Commission is considered the “expert” on Civil Service Act and its own regulations, it need not give deference to the ALJ’s legal conclusions.

However, the Commission is required to accept, reject or modify the ALJ’s recommended decision within 45 days unless all parties in the action unanimously consent to an extension.  If there is no unanimous consent for an extension, the ALJ’s decision is “deemed adopted” and becomes a final, binding decision if the Commission does not accept, reject or modify it within those 45 days.

 

The Hendrickson Case

In the Hendrickson case, New Jersey’s Supreme Court confronted a technical but vitally important question under the “deemed adopted” provisions of the New Jersey Administrative Procedures Act, which governs procedures in the OAL and New Jersey’s administrative agencies, including the Civil Service Commission.

William Hendrickson was terminated by his employer, the New Jersey Department of Community Affairs, for comments he made about his supervisor which were extremely sexist and inappropriate.  Hendrickson appealed to the Civil Service Commission, which referred the case to the OAL as a contested case.

The administrative law judge held a trial with multiple witnesses.  The ALJ found that Hendrickson had, in fact, made the highly inappropriate statements and was therefore guilty of misconduct.  However, the ALJ rejected termination as the appropriate discipline.  The ALJ ruled that because Hendrickson never had any other discipline, progressive discipline called for the lesser, although still severe, discipline of a six month unpaid suspension.

The ALJ then submitted the decision to the Civil Service Commission.  However, the governor and Legislature had not nominated and approved a sufficient number of commissioners for the Commission to constitute a quorum – in other words, the Commission did not have enough commissioners and was therefore legally unable to take action on the ALJ’s decision.  The Commission asked for the consent of all parties for an extension, but Hendrickson’s attorneys refused.  The Commission therefore did not action within the required 45 days, and the ALJ’s decision was deemed adopted and final.

 

The DCA’s Appeal to the Appellate Division

The Department of Community Affairs, Hendrickson’s employer, then appealed to the Appellate Division of New Jersey Superior Court, which hears appeals from New Jersey’s administrative agencies, such as the Civil Service Commission.  The District Court Appellate Division agreed that the ALJ was wrong and that Hendrickson should be fired.

As a general matter of law, administrative agencies, such as the Civil Service Commission; are given significant deference by courts in appeals because they are considered the “experts” in their area.   The DCA argued, however, that the decision should be given no deference because it was made by an ALJ rather than the Commission, even though it was deemed adopted as a final decision of the Commission.

The Appellate Division agreed.  It reviewed the ALJ’s decision “de novo”, or essentially as a fresh set of eyes evaluating the evidence for itself, rather than deferring to the ALJ, and reinstated the penalty of termination – so Hendrickson was fired again.

 

The New Jersey Supreme Court Rules

Hendrickson then appealed to the New Jersey Supreme Court, which reversed.  The Supreme Court ruled that even though it was the ALJ which made the decision rather through the Civil Service Commission, it was deemed adopted by the Commission and should therefore be reviewed under the same deferential standard which would have been applied had the Commission acted on it in a timely fashion.

The Supreme Court therefore reversed the Appellate Division’s ruling, and reinstated Hendrickson’s employment subject to the six month suspension.

 

The Takeaway

The “deemed adopted” rule has teeth.  If the Civil Service Commission does not act within the required time on an ALJ’s decision  – even if not through its own fault – it will be deemed adopted.  The ALJ’s decision will then receive the same deference from the courts as would a final decision actually made by the Commission within the required 45 days.  This makes it all the more important (which of course it always was anyway) to present all of the best evidence and important witnesses to the administrative law judge during the hearing at the Office of Administrative Law – because it just became even harder to appeal.

 

Contact Us

Our attorneys represent New Jersey civil service employees in all aspects of New Jersey  employment law, including appealing discipline imposed by their employers.  We represent civil service employees in employer level hearings, appeals to the Civil Service Commission, hearings in the Office of Administrate Law, and in New Jersey’s appeals courts.  Call us at (973) 890-0004 or email us to set up a consultation with one of our New Jersey employment lawyers.  We can help.