"We interpret a regulation in the same manner that we would interpret a statute."
How later courts described this case
- "We interpret a regulation in the same manner that we would interpret a statute."
Written by the judges who cited it.
The opinion
NOT FOR PUBLICATION WITHOUT THE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.
SUPERIOR COURT OF NEW JERSEY
APPELLATE DIVISION
DOCKET NO. A-0041-23
WILLIAM HAUS,
Petitioner-Appellant,
v.
BOARD OF TRUSTEES,
PUBLIC EMPLOYEES'
RETIREMENT SYSTEM,
Respondent-Respondent.
_________________________
Argued October 21, 2024 – Decided November 6, 2024
Before Judges Berdote Byrne and Jacobs.
On appeal from the Board of Trustees of the Public
Employees' Retirement System, Department of the
Treasury, PERS No. xx3791.
Steven D. Cahn argued the cause for appellant (Cahn &
Parra, PA, attorneys; Steven D. Cahn, on the briefs).
Matthew Melton, Deputy Attorney General, argued the
cause for respondent (Matthew J. Platkin, Attorney
General, attorney; Janet Greenberg Cohen, Assistant
Attorney General, of counsel; Matthew Melton, on the
brief).
PER CURIAM
William Haus appeals from a final administrative determination of the
Board of Trustees of the Public Employees' Retirement System ("Board" or
"PERS") denying his requests to maintain his PERS multiple-member pension
status, and for a hearing conducted by the Office of Administrative Law
("OAL"). We vacate the Board's determination and remand for a hearing before
the OAL to determine whether Haus was laid off and whether he is entitled to
reinstatement of his PERS multiple-member status.
I.
Haus was first enrolled in PERS on November 1, 1984, when he became
employed with South Plainfield as a recreation attendant. The parties stipulate
he attained multiple-member status on August 1, 2009, when he started a second
job as a motor-vehicle operator for Middlesex County and maintained those two
positions for nearly eleven years.
On March 24, 2020, Haus received an email from the Director of
Recreation at South Plainfield, Elizabeth Yarus, ("Yarus Email") informing him
as follows:
As the situation with COVID[-]19 continues to change
and develop and the Governor puts additional
restrictions on operations, I have been asking what that
will mean for you. Effective immediately, we can not
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2
have part-time staff coming into the building to do any
work.
This leaves you with the below options:
-You can use [Paid Time Off] days as you see fit
-You can take unpaid time
-We can terminate your status so you may be eligible to
collect unemployment . . . . If you choose this option,
will [sic] be happy to reinstate you after this situation
resolves and we are back to our regular operating status.
Haus selected the third option in order to collect unemployment benefits. He
continued to work for Middlesex County because his position as a Meals on
Wheels delivery person was deemed essential, allowing him to collect only a
reduced amount of unemployment benefits. Upon reinstatement at South
Plainfield on September 21, 2020, Haus applied to have his PERS multiple -
member status reinstated as well.
The Division of Pensions and Benefits determined Haus's decision to
temporarily cease work to receive unemployment benefits disqualified him from
multiple-member PERS status and reiterated this determination to Haus on
February 17, 2022, specifying Haus's period of non-employment amounted to a
disqualifying "break in service." However, the Division noted South Plainfield
would be able to remit further pension contributions to him as a PERS multiple-
member if he could present evidence his period of non-employment was due to
a layoff.
A-0041-23
3
To determine whether Haus's period of non-employment was a "layoff,"
the Division requested South Plainfield provide "the actual layoff notice that
was presented to Mr. Haus." South Plainfield responded, "there was no 'actual'
layoff notice," only the Yarus Email. The Division informed South Plainfield
the Yarus Email was insufficient to qualify as a layoff notice and notified Haus
on November 23, 2022, that its decision to not reinstate his multiple-member
PERS status would not change because it equated a lack of a layoff notice with
a finding Haus had not been laid off.
Haus appealed the Division's decision on December 8, 2022, and the
Board agreed with the Division's decision to not reinstate Haus's multiple-
member PERS status on May 12, 2023. Haus appealed and requested an
administrative hearing on June 23, 2023. The Board affirmed its decision not to
reinstate Haus's multiple-member PERS status on August 17, 2023 and denied
Haus an administrative hearing. This appeal followed.
II.
Our review of an administrative agency's determination is limited. In re
Carter, 191 N.J. 474, 482 (2007); McKnight v. Bd. of Rev., Dep't of Lab., 476
N.J. Super. 154, 162 (App. Div. 2023). We will sustain a board's decision
"unless there is a clear showing that it is arbitrary, capricious, or unreasonable,
A-0041-23
4
or that it lacks fair support in the record." McKnight, 476 N.J. Super. at 162
(quoting In re Herrmann, 192 N.J. 19, 27-28 (2007)). Pursuant to this standard,
our review is guided by three inquiries: (1) whether the agency's decision
conforms with relevant law; (2) whether the decision is supported by substantial,
credible evidence in the record; and (3) whether, in applying the law to the facts,
the administrative agency "clearly erred in reaching" its conclusion. Allstars
Auto Grp., Inc. v. N.J. Motor Vehicle Comm'n, 234 N.J. 150, 157 (2018)
(quoting In re Stallworth, 208 N.J. 182, 194 (2011)).
Although we are not bound by an agency's statutory interpretation or other
legal determinations, Russo v. Bd. of Trs., Police & Firemen's Ret. Sys., 206
N.J. 14, 27 (2011) (quoting Mayflower Secs. Co. v. Bureau of Secs. in the Div.
of Consumer Affs., 64 N.J. 85, 93 (1973)), we accord an agency "substantial
deference to the inter[pretation] given" to the statute it is charged with
enforcing. Bd. of Educ. of Neptune v. Neptune Twp. Educ. Ass'n, 144 N.J. 16,
31 (1996) (citing Merin v. Maglaki, 126 N.J. 430, 436-37 (1992)). "Such
deference has been specifically extended to state agencies that administer
pension statutes" because "a state agency brings experience and specialized
knowledge to its task of administering and regulating a legislative enactment
within its field of expertise." Piatt v. Police & Firemen's Ret. Sys., 443 N.J.
A-0041-23
5
Super. 80, 99 (App. Div. 2015) (first citing Richardson v. Bd. of Trs., Police &
Firemen's Ret. Sys., 192 N.J. 189, 196 (2007); and then quoting In re Election
L. Enf't Comm'n Advisory Op. No. 01-2008, 201 N.J. 254, 262 (2010)).
On appeal, Haus argues he should have been afforded an administrative
hearing before the OAL because there are disputed facts as to the Board's
decision to deny his PERS multiple-member status. N.J.A.C. 17:2-1.7 provides
guidance regarding appeals from PERS Board decisions and an appellant's
entitlement to an administrative hearing:
The Board shall determine whether to grant an
administrative hearing based upon the standards for a
contested case hearing set forth in the Administrative
Procedure Act, N.J.S.A. 52:14B-1 and the Uniform
Administrative Procedure Rule, N.J.A.C. 1:1-1 et seq.
Administrative hearings shall be conducted by the
Office of Administrative Law pursuant to the
provisions of N.J.S.A. 52:14B-1 et seq. and N.J.A.C.
1:1.1.
If the granted appeal involves solely a question of law,
the Board may retain the matter and issue a final
determination, which shall include detailed findings of
fact and conclusions of law based upon the documents,
submissions and legal arguments of the parties. The
Board's final determination may be appealed to the
Superior Court, Appellate Division. If the granted
appeal involves a question of facts, the Board shall
submit the matter to the Office of Administrative Law.
[N.J.A.C. 17:2-1.7(a).]
A-0041-23
6
See also Frank v. Ivy Club, 120 N.J. 73, 98 (1990). We conclude the Board
erred in denying Haus an administrative hearing because there are material
issues of fact as to whether Haus was laid off.
Prior to May 21, 2010, state employees could aggregate their salaries from
multiple state positions for pension purposes. See N.J.S.A. 43:15A-25.2. The
Legislature has since eliminated this entitlement, providing:
after [May 21, 2010], a person who is or becomes a
member of the [PERS] and becomes employed in more
than one office, position, or employment covered by the
retirement system or commences services in a covered
office, position, or employment with more than one
employer shall be eligible for membership in the
retirement system based upon only one of the offices,
positions, or employments held concurrently.
[N.J.S.A. 43:15A-25.2(a).]1
The Legislature included a grandfathering provision permitting employees who
had achieved multiple-member PERS status before May 21, 2010, to retain their
status, as long as "the member continues to hold [the pre-May 21, 2010
1
Although Haus in his brief cites to the PERS Guidebook, which states N.J.S.A.
43:15A-7 is the statute defining the multiple-member PERS policy and
grandfathering provision, the correct statute is N.J.S.A. 43:15A-25.2, which is
cited by the Board in its brief and its Final Administrative Determination.
A-0041-23
7
positions] without a break in service." 2 N.J.S.A. 43:15A-25.2(c). A "break in
service" for PERS purposes is defined as "any pension reporting period without
pay . . . with the exception of approved leaves of absence, lay-off, abolishment
of position, military leave, Workers' Compensation, litigation, or suspension."
N.J.A.C. 17:2-1A.1. We agree with Haus that a genuine issue of fact exists as
to whether his 2020 period of non-employment qualified as a "layoff" excluded
from N.J.A.C. 17:2-1A.1's definition of "break in service."
Determining the Legislature's intent is the critical first step in statutory
interpretation. W.S. v. Hildreth, 252 N.J. 506, 518-19 (2023). "The 'best
indicator' of legislative intent 'is the statutory language.'" Id. at 519 (quoting
State v. Lane, 251 N.J. 84, 94 (2022)). We "ascribe to the statutory words their
ordinary meaning and significance and read them in context with related
provisions so as to give sense to the legislation as a whole." Ibid. (alterations in
original) (quoting DiProspero v. Penn, 183 N.J. 477, 492 (2005)). "When the
plain language of a statute is clear and unambiguous," we will "apply the law as
written." Ibid. We "may neither rewrite a plainly-written enactment of the
2
This grandfathering provision entitles only those with multiple-member status
to retain their status and does not permit grandfathered employees to aggregate
the salaries of positions started after May 21, 2010, for pension purposes.
N.J.S.A. 43:15A-25.2(c).
A-0041-23
8
Legislature nor presume that the Legislature intended something other than that
expressed by way of the plain language." Ibid. (quoting O'Connell v. State, 171
N.J. 484, 488 (2002)). This analysis applies equally to provisions in the New
Jersey Statutes and the New Jersey Administrative Code. See US Bank, N.A. v.
Hough, 210 N.J. 187, 199 (2012) ("We interpret a regulation in the same manner
that we would interpret a statute.").
We conclude Haus's period of unemployment may be consistent with a
layoff. A layoff is a "separation of a permanent employee from employment for
reasons of economy or efficiency or other related reasons and not for
disciplinary reasons." N.J.A.C. 4A:1-1.3;3 see also N.J.S.A. 11A:8-1(a) ("A
permanent employee may be laid off for economy, efficiency[,] or other related
reason."); Layoff, Black's Law Dictionary (12th ed. 2024) (defining "layoff" as
"[t]he termination of employment at the employer's instigation, usu [ally]
through no fault of the employee; esp[ecially], the termination—either
temporary or permanent—of many employees in a short time for financial
3
Title 4A of the New Jersey Administrative Code pertains to employees in the
civil-service system. See N.J.A.C. 4A:1-1.2(c). This title is applicable to
actions carried out by Haus's employer, South Plainfield, because it is an
enumerated New Jersey civil service system employer. Civ. Serv. Jurisdictions,
Civ. Serv. Comm'n,
https://www.nj.gov/csc/about/divisions/slo/jurisdictions.html (last visited Oct.
28, 2024).
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9
reasons."). "Municipalities governed by the civil service system have the right
to lay-off employees when facing exigent financial circumstances." Borough of
Keyport v. Int'l Union of Operating Eng'rs, 222 N.J. 314, 320 (2015).
There are several statutory and administrative protections afforded to civil
service employees subject to a layoff. See, e.g., N.J.A.C. 4A:8-1.1 to -1.6
(outlining an employer's duty to consider alternatives to layoffs, consult with
affected employees' union representatives, and notify employees of the layoff);
N.J.A.C. 4A:8-2.1 to -2.6 (outlining an affected employee's post-layoff rights);
N.J.S.A. 11A:8-1 to -4 (providing specific pre-layoff actions and alternatives to
layoffs civil service employers must consider). Despite these provisions, there
is no statute, administrative code provision, or case law cited by the Board
supporting the Board's conclusion a formal layoff notice is required in order to
conclude a layoff in fact occurred. These provisions merely lay out the
protections afforded to any civil service employee subject to a layoff.
Importantly, each of these provisions are subject to the definition of "layoff" as
provided by N.J.A.C. 4A:1-1.3. That definition states that a layoff occurs only
when there is "the separation of a permanent employee from employment for
reasons of economy or efficiency or other related reasons and not for
disciplinary reasons." Ibid. That definition does not require any formal layoff
A-0041-23
10
notice. Thus, we conclude the existence of a formal layoff notice is not
determinative of whether a layoff occurred. See State v. Cooper, 256 N.J. 593,
605 (2024) (concluding if a provision "carefully employ[s] a term in one place
yet exclude[s] it in another, it should not be implied where excluded"). It was
therefore unreasonable for the Board to conclude Haus did not experience a
layoff as a matter of law based solely on its conclusion South Plainfield had not
issued a formal layoff notice.
South Plainfield posits Haus chose to voluntarily terminate his
employment, rendering him ineligible to reinstate multiple-member PERS
status. However, as noted by Haus, the Yarus Email cannot be read in a vacuum.
The email intended to provide options to employees during an unprecedented
global pandemic and stated "[i]f you choose this option, [we] will be happy to
reinstate you after this situation resolves and we are back to our regular
operating status." Yarus's authority to extend those options is in question, and
the parties do not dispute the email is devoid of any discussion of the pension
consequences of any of the options. The parties do not dispute Haus was
reinstated, consistent with the email. Haus was entitled to an OAL hearing to
determine whether this promise of automatic reinstatement of employment was
A-0041-23
11
tantamount to a layoff, which would enable him to reinstatement of multiple-
member PERS status.
We vacate the Board's decision and remand for a hearing before the OAL.
We take no position regarding the final determination. We do not retain
jurisdiction.
Reversed and remanded for an OAL hearing.
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