ASSEMBLY, No. 4487

STATE OF NEW JERSEY

216th LEGISLATURE

 

INTRODUCED JUNE 4, 2015

 

 

Sponsored by:

Assemblywoman  NANCY F. MUNOZ

District 21 (Morris, Somerset and Union)

 

 

 

 

SYNOPSIS

     Concerns payment of leave time to employee in year of employee's retirement.

 

CURRENT VERSION OF TEXT

     As introduced.

  

An Act concerning the payment of leave time to employees of a local unit in the year of retirement and supplementing chapter 5 of Title 40A of the New Jersey Statutes.

 

     Be It Enacted by the Senate and General Assembly of the State of New Jersey:

 

     1.    a.    As used in this section:

     "Leave time" means vacation time, holiday time, sick leave time, or personal time credited by a local unit of government to the employees of the local unit on a pro rata basis or at the beginning of a calendar year; and

     "Local unit" means a municipality or county, or any agency or instrumentality created by a county or municipality, including independent local authorities and joint meetings, and also including regional entities comprised of two or more local units.

     b.    A local unit that elects to pay terminal leave to a retiring employee, or to an employee who otherwise separates from employment, for accumulated and unused leave time, shall not pay for any leave time credited at the beginning of the final year of employment that would not have been credited at the time or retirement or separation if the leave time had to be earned on a pro rata basis, based on the number of days during the final year that the employee actually worked, discounting any leave time used.

     c.    A collective negotiations agreement between a local unit and any of its employees shall not provide for the payment of leave time credited at the beginning of an employee's final year of employment that exceeds an amount calculated pursuant to subsection b. of this section.

 

     2.    This act shall take effect immediately and shall be applicable to terminal leave payments made, and collective negotiations agreements entered into, or extended, on and after the effective date.

 

 

STATEMENT

 

     This bill limits the maximum amount of terminal leave that a local unit can pay, for accumulated and unused leave time, to an employee who is separating from service through retirement or otherwise.  Under the bill, an employee could not be paid for the full amount of leave time credited at the beginning of the employee's final year of employment if the employee does not work the whole year.

     As used in the bill, "leave time" means vacation time, holiday time, sick leave time, or personal time credited by a local unit of government to the employees of the local unit at the beginning of a calendar year.

     The bill is intended to address a recent circumstance where a provision of a collective negotiations agreement between a municipality and its police union effectively allowed a retiring police officer to work one month into a calendar year, retire on February 1st, and collect a lump sum of over $34,000 representing payment for the entire year's worth of vacation, sick, personal time, holiday time, and other leave time to which the officer would have been entitled had he not retired.  This contract provision, while likely entered into by the local unit and the union in good faith, required a large payment of property tax dollars to a retired police officer who worked only one month out of the 12 in the calendar year.  These types of payments should not be allowed to continue, and any local unit employee who retires should receive a payment for unused leave time prorated by the number of days that the employee is actually employed by and reports to work in the local unit.