New Jersey unions go toe to toe with Christie over pensions

TRENTON, N.J. – Unions representing New Jersey state and local government workers vowed on June 9 that the fight over GOP Gov. Chris Christie’s pension payment cuts is not over, despite a state Supreme Court ruling upholding Christie’s decision.

And, the battlers for the pensions noted, the fight will continue in coming years: The case involved Christie’s cutting pension payments for fiscal 2015, but he also wants to cut the payments in fiscal 2016 – and a trial judge heard that case in May.

The battle between Christie and the workers is part of a nationwide drive by governors and lawmakers to slash workers’ pay, benefits, pensions and worker rights.  Most, but not all, of those governors and lawmakers are Republicans.  Workers recently defeated a similar state pension cut in the Illinois Supreme Court. A former Democratic governor pushed that through.

New Jersey unions, led by the Communications Workers, which represents 60,000 government workers, sued Christie when he refused to make a the full state pension payment under a law he negotiated with state Democratic legislative leaders – over union protests – five years ago.  Lower courts sided with the unions; the High Court didn’t.

The difference is huge: For at least two decades before the 2011 law – and since then — workers contributed to their pension plan, as contracts required, but the state didn’t. 

The law mandated the state catch up, including a $1.57 billion payment in fiscal 2015, on top of $681 million to cover current workers. Christie paid the smaller sum, but said a state “fiscal emergency” voided the law requiring the total payment.

By a 5-2 vote, the state high court said the 2011 law violated the state constitution’s debt limit and appropriations clauses.  One dissenting justice noted that while the court let the state off the hook, the workers still must make the higher payments into pension funds the 2011 law mandates. Workers have contributed 70 percent of the fund’s income since then.

“The legislature and governor were without power, acting without voter approval, to transgress the debt limitation clause” and the other constitutional sections, the majority ruled.

The politicians “as well as the many interested parties in the legislative process, may have included contractual words” in the law “but those words, no matter their clarity, could not create an enforceable contract of the type asserted. Voter approval is required to render this a legally enforceable contractual agreement.”

“We hoped the court would uphold the basic tenet that the law is what it says it is,” responded New Jersey CWA State Director Hetty Rosenstein. “But the fact that they didn’t rule for us is merely another obstacle that we will overcome.

“Christie broke his word, and whatever shred of credibility he had left when he refused to fund the pension.  Our union will never permit the destruction of the pension system and, as such, the destruction of New Jersey’s economy. If it is unconstitutional to meet the pension obligation, perhaps we will have to change the constitution. But one thing I know is this: We will fight, and we will win,” she added.

Wendell Steinhauer, president of the New Jersey Education Association, the state’s largest teacher union, told reporters in Trenton that the decision is “a travesty.”  A week before the ruling the NJEA launched a $750,000 TV ad buy warning state residents that Christie was again trying to cut the required pension payments.  The union represents 200,000 workers.

“What the Supreme Court did today is a slap in the face of every public employee in New Jersey.  They have made every sacrifice asked over the last four years and every year before that. It’s been painful.  So I’m furious, and my members are furious. And they should be. We’re not sad, we’re not scared. We’re fighting mad,” Steinhauer added.

In his latest budget proposal, Christie wants to make a required $1.3 billion pension payment covering current workers – and skip the $1.8 billion the law requires to help make up the 20 years of arrears. 

State legislative leaders, both Democrats, vowed to enact a budget to fund the full $2.25 billion for last year and the full $3.1 billion for next year, by raising taxes on the rich. But when they did that before, Christie used his line-item veto to eliminate both the $1.57 billion pension arrears payment and the taxes.                              

The day before the ruling, NEA-represented teachers in Somerset County went into the streets to demand Christie follow the law.  A GOP state legislator engaged in a civilized – agreeing-to-disagree – discussion with the teachers and their leaders about must be done to close the pension shortfall.  He noted taxing the rich would not raise enough cash.

Photo: Chris Christie.  |  Mel Evans/AP


Mark Gruenberg
Mark Gruenberg

Award-winning journalist Mark Gruenberg is head of the Washington, D.C., bureau of People's World. He is also the editor of the union news service Press Associates Inc. (PAI). Known for his reporting skills, sharp wit, and voluminous knowledge of history, Mark is a compassionate interviewer but tough when going after big corporations and their billionaire owners.