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  • NJ Union Ignores State Supreme Court, Fights Settled Pension Battle

    The New Jersey State AFL-CIO told reporters Thursday it will continue fighting Republican Gov. Chris Christie for breaking his own law with a 2014 pension cut despite the state Supreme Court saying he actually didn’t.

    “Everyone is abiding by the pension reform law – except the governor who signed it,” the union declared in a statement. “And now, while the governor continues to break his own pension law by skipping contractually required pension payments, he is calling for additional concessions for public workers.”

    Unions have long argued the pension cuts violated a reform law Christie signed himself. Several unions even sued the governor but on June 9, 2015 the New Jersey Supreme Court ruled the pension cuts were legal and did not violate the previous reform law. Nevertheless, unions with the support of some state Democratic lawmakers are still arguing it does.

    “The labor movement and the Democratic-led Legislature are united in their conviction that pensions must be funded according to the law,” the union continued. “The results of the governor’s reckless disregard for the law and callous disrespect for pensioners are well-known.”

    The union also called out the court decision itself, noting it was used by Christie as a workaround to ignore his own law.

    “His willingness to argue against his own law in the state’s highest court rather than honor the deal he signed and touted in a cross-country victory lap,” the union noted. “And his total disregard for the long-term effects his selfish fiscal policies will have on the public and private sectors while he’s looking out only for his own future.”

    At the center of the conflict was a 2011 provision known as Chapter 78 which legally compelled the state to pay retirement pensions in full. Despite this, in 2014 Gov. Christie signed Executive Order 156 which significantly cut pension benefits to address serious budget problems. While unions argued Chapter 78 puts the state under a contractual agreement to pay the pensions, the courts found it actually doesn’t.

    “Chapter 78 does not create a legally enforceable contract that is entitled to constitutional protection,” the decision noted. “The Debt Limitation Clause of the State Constitution interdicts the creation, in this manner, of a legally binding enforceable contract compelling multi-year financial payments in the sizable amounts called for by the statute.”

    The cost of retirement benefits and pensions for state employees has been a growing problems in many states, including New Jersey. According to a 2014 report from the New Jersey Pension and Health Benefit Study Commission, pensions could become a problem for future generations without reforms.

    “This future debt, while not due now, represents a $53 billion liability,” the report detailed. “Heightening concerns that these costs will be a burden on the next generation, the ratio of retirees – who contribute less to their health care costs – to active employees has been increasing. The State’s total cost of providing coverage to retirees now exceeds the cost of providing coverage to active employees, and is increasing at an even faster rate.”

    The union did not respond to requests for comment from The Daily Caller News Foundation.

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