Bill Text: NJ S1807 | 2014-2015 | Regular Session | Introduced
Bill Title: Removes expiration of required payment by public employees of percentage of cost of health care coverage provided by public employers.
Spectrum: Partisan Bill (Republican 2-0)
Status: (Introduced - Dead) 2014-08-15 - Reviewed by the Pension and Health Benefits Commission Recommend to enact [S1807 Detail]
Download: New_Jersey-2014-S1807-Introduced.html
Sponsored by:
Senator JENNIFER BECK
District 11 (Monmouth)
SYNOPSIS
Removes expiration of required payment by public employees of percentage of cost of health care coverage provided by public employers.
CURRENT VERSION OF TEXT
As introduced.
An Act concerning the payment by public employees for health care benefits coverage provided by public employers and amending P.L.2011, c.78 and repealing sections 77, 78, and 79 of P.L.2011, c.78.
Be It Enacted by the Senate and General Assembly of the State of New Jersey:
1. Section 40 of P.L.2011, c.78 (C.52:14-17.28d) is amended to read as follows:
40. a. Notwithstanding the provisions of any other law to the contrary, public employees of the State and employers other than the State shall contribute, through the withholding of the contribution from the pay, salary, or other compensation, toward the cost of health care benefits coverage for the employee and any dependent provided under the State Health Benefits Program or the School Employees' Health Benefits Program in an amount that shall be determined in accordance with section 39 of P.L.2011, c.78 (C.52:14-17.28c), except that, an employee employed on the date on which the contribution commences, as specified in subsection c. of this section, shall pay:
during the first year in which the contribution is effective, one-fourth of the amount of contribution;
during the second year in which the contribution is effective, one-half of the amount of contribution; and
during the third year in which the contribution is effective, three-fourths of the amount of contribution,
as that amount is calculated in accordance with section 39 of P.L.2011, c.78 (C.52:14-17.28c).
The amount payable by any employee under this subsection shall not under any circumstance be less than the 1.5 percent of base salary that is provided for in subsection c. of section 6 of P.L.1996, c.8 (C.52:14-17.28b), subsection a. of section 7 of P.L.1964, c.125 (C.52:14-17.38), or subsection b. of section 39 of P.L.2007, c.103 (C.52:14-17.46.9). An employee who pays the contribution required under this subsection shall not also be required to pay the contribution of 1.5 percent of base salary under those subsections listed above.
This section shall apply to employees for whom the employer has assumed a health care benefits payment obligation, to require that such employees pay at a minimum the amount of contribution specified in this section for health care benefits coverage.
b. (1) Notwithstanding the provisions of any other law to the contrary, public employees of the State and employers other than the State, as those employees are specified in paragraph (2) of this subsection, shall contribute, through the withholding of the contribution from the monthly retirement allowance, toward the cost of health care benefits coverage for the employee in retirement and any dependent provided under the State Health Benefits Program or the School Employees' Health Benefits Program in an amount that shall be determined in accordance with section 39 of P.L.2011, c.78 (C.52:14-17.28c) by using the percentage applicable to the range within which the annual retirement allowance, and any future cost of living adjustments thereto, falls. The retirement allowance, and any future cost of living adjustments thereto, shall be used to identify the percentage of the cost of coverage.
(2) The contribution specified in paragraph (1) of this subsection shall apply to:
(a) State employees and employees of an independent State authority, board, commission, corporation, agency, or organization for whom there is a majority representative for collective negotiations purposes who accrue 25 years of nonconcurrent service credit in one or more State or locally-administered retirement systems on or after the effective date of P.L.2011, c.78, or on or after the expiration of an applicable binding collective negotiations agreement in force on that effective date, and who retire on or after that effective date or expiration date, excepting employees who elect deferred retirement;
(b) State employees and employees of an independent State authority, board, commission, corporation, agency, or organization for whom there is no majority representative for collective negotiations purposes who accrue 25 years of nonconcurrent service credit in one or more State or locally-administered retirement systems on or after that effective date, or on or after the expiration of an applicable binding collective negotiations agreement in force on that effective date if the terms of that agreement concerning health care benefits coverage in retirement have been deemed applicable by the commission or the employer to those employees, and who retire on or after that effective date or expiration date, excepting employees who elect deferred retirement;
(c) employees covered by section 3 of P.L.1987, c.384 (C.52:14-17.32f), section 2 of P.L.1992, c.126 (C.52:14-17.32f1), or section 1 of P.L.1995, c.357 (C.52:14-17.32f2) who accrue 25 years of service credit on or after that effective date and retire on or after that effective date, including employees who elect deferred retirement;
(d) employees of an employer other than the State for whom there is a majority representative for collective negotiations purposes who accrue the number of years of service credit, and age if required, as specified in subsection b. of section 7 of P.L.1964, c.125 (C.52:14-17.38), on or after that effective date, or on or after the expiration of an applicable binding collective negotiations agreement in force on that effective date, and who retire on or after that effective date or expiration date, excepting employees who elect deferred retirement, when the employer has assumed payment obligations for health care benefits in retirement for such an employee; and
(e) employees of an employer other than the State for whom there is no majority representative for collective negotiations purposes who accrue the number of years of service credit, and age if required, as specified in subsection b. of section 7 of P.L.1964, c.125 (C.52:14-17.38), on or after that effective date, or on or after the expiration of an applicable binding collective negotiations agreement in force on that effective date if the terms of that agreement concerning health care benefits payment obligations in retirement have been deemed applicable by the employer to those employees, and who retire on or after that effective date or expiration date, excepting employees who elect deferred retirement, when the employer has assumed payment obligations for health care benefits in retirement for such an employee.
(3) Employees described in paragraph (2) of this subsection who have 20 or more years of creditable service in one or more State or locally-administered retirement systems on the effective date of P.L.2011, c.78 shall not be subject to the provisions of this subsection.
(4) The amount payable by a retiree under this subsection shall not under any circumstance be less than the 1.5 percent of the monthly retirement allowance, including any future cost of living adjustments thereto, that is provided for such a retiree, if applicable to that retiree, under subsection d. of section 6 of P.L.1996, c.8 (C.52:14-17.28b), subsection b. of section 7 of P.L.1964, c.125 (C.52:14-17.38), section 3 of P.L.1987, c.384 (C.52:14-17.32f), section 2 of P.L.1992, c.126 (C.52:14-17.32f1), or section 1 of P.L.1995, c.357 (C.52:14-17.32f2), or less than a comparable contribution with regard to the retirees who are members of the alternate benefit program. A retiree who pays the contribution required under this subsection shall not also be required to pay the contribution of 1.5 percent of the monthly retirement allowance under those sections or subsections listed above.
c. The contribution required under subsection a. of this section shall commence: (1) upon the effective date of P.L.2011, c.78 for employees who do not have a majority representative for collective negotiations purposes, notwithstanding that the terms of a collective negotiations agreement binding on the employer have been applied or have been deemed applicable to those employees by the commission or the employer, or have been used to modify the respective payment obligations of the employer and those employees in a manner consistent with those terms, as permitted by law, before that effective date; and (2) upon the expiration of any applicable binding collective negotiations agreement in force on that effective date for employees covered by that agreement with the contribution required for the first year under subsection a. of this section commencing in the first year after that expiration, or upon the effective date of P.L.2011, c.78 if such an agreement has expired before that effective date with the contribution required for the first year under subsection a. of this section commencing in the first year after that effective date.
Once those employees are subjected to the contribution requirements set forth in subsection a. of this section, the public employers and public employees shall be bound by this act, P.L.2011, c.78, to apply the contribution levels set forth in section 39 of this act until all affected employees are contributing the full amount of the contribution, as determined by the implementation schedule set forth in subsection a. of this section. [Notwithstanding the expiration date set forth in section 83 of this act, P.L.2011, c.78, or the expiration date of any successor agreements, the parties shall be bound to apply the requirements of this paragraph until they have reached the full implementation of the schedule set forth in subsection a. of this section.]
The provisions of law permitting the determination of an amount of contribution at the discretion of the employer or by means of a binding collective negotiations agreement, and by means of the application of the terms of such an agreement to employees who do not have a majority representative for collective negotiations purposes, or the modification of the respective payment obligations of the employer and those employees in a manner consistent with the terms of such an agreement, shall remain in effect with regard to contributions, whether as a share of the cost, or percentage of the premium or periodic charge, or otherwise, in addition to the contributions required under subsections a. and b. of this section.
Paragraphs (5) and (6) of subsection c. of section 6 of P.L.1996, c.8 (C.52:14-17.28b) shall not be deemed to apply with regard to contributions specified and made under this section. Paragraph (7) of subsection c. of P.L.1996, c.8 (C.52:14-17.28b) shall apply with regard to contributions specified and made under this section.
A qualified retiree under section 1 of P.L.1997, c.330 (C.52:14-17.32i) who meets the eligibility requirements on or after the effective date of P.L.2011, c.78 shall not pay less than the contribution required under subsection b. of this section, including as specified in paragraph (3) of subsection b. of this section. Part-time State employees and part-time faculty members participating under section 1 of P.L.2003, c.172 (C.52:14-17.33a) shall not pay less than the contribution specified in subsection a. of this section. Subsection b. of this section shall apply under subsection b. of section 7 of P.L.1964, c.125 (C.52:14-17.38) to a surviving spouse of a retired employee of an employer other than the State and the employee's dependents in the same manner as to the retiree at the time of death.
The minimum contribution based on the retirement allowance of members of the alternate benefit program in retirement shall be determined, as may be necessary, pursuant to the formula specified in paragraph (4) of subsection c. of section 6 of P.L.1996, c.8 (C.52:14-17.28b).
All other provisions of law shall remain applicable to the extent not inconsistent with this section.
d. Any extension, alteration, re-opening, amendment or other adjustment to a collective negotiations agreement in force on the effective date of P.L.2011, c.78, or to an agreement that is expired on that effective date, shall be considered a new collective negotiations agreement entered into after that effective date for the purposes of this section.
(cf: P.L.2011, c.78, s.40)
2. Section 41 of P.L.2011, c.78 (C.18A:16-17.1) is amended to read as follows:
41. a. Notwithstanding the provisions of any other law to the contrary, public employees, as specified herein, of a local board of education shall contribute, through the withholding of the contribution from the pay, salary, or other compensation, toward the cost of health care benefits coverage for the employee and any dependent provided pursuant to P.L.1979, c.391 (C.18A:16-12 et seq.), unless the provisions of subsection b. of this section apply, in an amount that shall be determined in accordance with section 39 of P.L.2011, c.78 (C.52:14-17.28c), except that, employees employed on the date on which the contribution commences, as specified in subsection c. of this section, shall pay:
during the first year in which the contribution is effective, one-fourth of the amount of contribution;
during the second year in which the contribution is effective, one-half of the amount of contribution; and
during the third year in which the contribution is effective, three-fourths of the amount of contribution,
as that amount is calculated in accordance with section 39 of P.L.2011, c.78 (C.52:14-17.28c).
The amount payable by any employee under this subsection shall not under any circumstance be less than the 1.5 percent of base salary that is provided for in subsection b. of section 6 of P.L.1979, c.391 (C.18A:16-17). An employee who pays the contribution required under this subsection shall not also be required to pay the contribution of 1.5 percent of base salary under subsection b. of section 6 of P.L.1979, c.391 (C.18A:16-17).
This section shall apply to employees for whom the employer has assumed a health care benefits payment obligation pursuant to section 6 of P.L.1979, c.391 (C.18A:16-17), to require that such employees pay at a minimum the amount of contribution specified in this section for health care benefits coverage.
b. A board of education may enter into a contract or contracts to provide health care benefits including prescription drug benefits and other health care benefits, as may be required to implement a duly executed collective negotiations agreement, and may provide through such agreement for an amount of employee contribution as a cost share or premium share that is other than the percentage required under subsection a. of this section, if the total aggregate savings during the term of the agreement from employee contributions or plan design, or both, from that agreement as applied to employees covered by that agreement, and to employees not covered by that agreement but to whom the agreement has been applied by the employer, if any, equals or exceeds the annual savings that would have resulted had those employees made the contributions required under subsection a. of this section plus the annual savings resulting to the plans within the School Employees' Health Benefits Program as a result of plan design changes made pursuant to P.L.2011, c.78.
A board of education shall certify the savings in writing to the Department of Education and the Division of Pensions and Benefits in the Department of the Treasury. The Department of Education shall review and approve or reject the certification within 30 days of receipt. The certification is deemed approved if not rejected within that time. The agreement shall not be executed until that approval is received or the 30-day period has lapsed, whichever occurs first.
c. The contribution under subsection a. of this section shall commence: (1) upon the effective date of P.L.2011, c.78 for employees who do not have a majority representative for collective negotiations purposes, notwithstanding that the terms of a collective negotiations agreement binding on the employer have been applied or have been deemed applicable to those employees by the employer, or have been used to modify the respective payment obligations of the employer and those employees in a manner consistent with those terms, before that effective date; and (2) upon the expiration of any applicable binding collective negotiations agreement in force on that effective date for employees covered by that agreement with the contribution required for the first year under subsection a. of this section commencing in the first year after that expiration, or upon the effective date of P.L.2011, c.78 if such an agreement has expired before that effective date with the contribution required for the first year under subsection a. of this section commencing in the first year after that effective date.
Once those employees are subjected to the contribution requirements set forth in subsection a. of this section, the public employers and public employees shall be bound by this act, P.L.2011, c.78, to apply the contribution levels set forth in section 39 of this act until all affected employees are contributing the full amount of the contribution, as determined by the implementation schedule set forth in subsection a. of this section. [Notwithstanding the expiration date set forth in section 83 of this act, P.L.2011, c.78, or the expiration date of any successor agreements, the parties shall be bound to apply the requirements of this paragraph until they have reached the full implementation of the schedule set forth in subsection a. of this section.]
As may be permitted by law or otherwise, the authority to determine an amount of contribution at the discretion of the employer or by means of a binding collective negotiations agreement, and by means of the application of the terms of such an agreement to employees who do not have a majority representative for collective negotiations purposes, or the modification of the respective payment obligations of the employer and those employees in a manner consistent with the terms of such agreements, shall remain in effect with regard to contributions, whether as a share of the cost, or percentage of the premium or periodic charge, or otherwise, in addition to the contributions required under subsection a. of this section.
This section shall apply when the health care benefits are provided through self insurance, the purchase of commercial insurance or reinsurance, an insurance fund or joint insurance fund, or in any other manner, or any combination thereof.
All other provisions of law shall remain applicable to the extent not inconsistent with this section.
d. Any extension, alteration, re-opening, amendment or other adjustment to a collective negotiations agreement in force on the effective date of P.L.2011, c.78, or to an agreement that is expired on that effective date, shall be considered a new collective negotiations agreement entered into after that effective date for the purposes of this section.
(cf: P.L.2011, c.78, s.41)
3. Section 42 of P.L.2011, c.78 (C.40A:10-21.1) is amended to read as follows:
42. a. Notwithstanding the provisions of any other law to the contrary, public employees, as specified herein, of a local unit or agency thereof, herein referred to as an employer, shall contribute, through the withholding of the contribution from the pay, salary, or other compensation, toward the cost of health care benefits coverage for the employee and any dependent provided pursuant to N.J.S.40A:10-16 et seq., unless the provisions of subsection c. of this section apply, in an amount that shall be determined in accordance with section 39 of P.L.2011, c.78 (C.52:14-17.28c), except that, employees employed on the date on which the contribution commences, as specified in subsection d. of this section, shall pay:
during the first year in which the contribution is effective, one-fourth of the amount of contribution;
during the second year in which the contribution is effective, one-half of the amount of contribution; and
during the third year in which the contribution is effective, three-fourths of the amount of contribution,
as that amount is calculated in accordance with section 39 of P.L.2011, c.78 (C.52:14-17.28c).
The amount payable by any employee under this subsection shall not under any circumstance be less than the 1.5 percent of base salary that is provided for in subsection b. of N.J.S.40A:10-21 or section 16 of P.L.2010, c.2 (C.18A:64A-13.1a). An employee who pays the contribution required under this subsection shall not also be required to pay the contribution of 1.5 percent of base salary under subsection b. of N.J.S.40A:10-21 or section 16 of P.L.2010, c.2 (C.18A:64A-13.1a).
This subsection shall apply to employees for whom the employer has assumed a health care benefits payment obligation pursuant to N.J.S.40A:10-21, to require that such employees pay at a minimum the amount of contribution specified in this section for health care benefits coverage, with an employer including a county college.
b. (1) Notwithstanding the provisions of any other law to the contrary, public employees of an employer, as those employees are specified in paragraph (2) of this subsection, shall contribute, through the withholding of the contribution from the monthly retirement allowance, toward the cost of health care benefits coverage for the employee in retirement and any dependent provided pursuant to N.J.S.40A:10-16 et seq., unless the provisions of subsection c. of this section apply, in an amount that shall be determined in accordance with section 39 of P.L.2011, c.78 (C.52:14-17.28c) using the percentage applicable to the range within which the annual retirement allowance, and any future cost of living adjustments thereto, falls. The retirement allowance, and any future cost of living adjustments thereto, shall be used to identify the percentage of the cost of coverage.
(2) The contribution specified in paragraph (1) of this subsection shall apply to:
(a) employees of employers for whom there is a majority representative for collective negotiations purposes who accrue the number of years of service credit, and age if required, as specified in N.J.S.40A:10-23, or on or after the expiration of an applicable binding collective negotiations agreement in force on that effective date, and who retire on or after that effective date or expiration date, excepting employees who elect deferred retirement, when the employer has assumed payment obligations for health care benefits in retirement for such an employee; and
(b) employees of employers for whom there is no majority representative for collective negotiations purposes who accrue the number of years of service credit, and age if required, as specified in N.J.S.40A:10-23, on or after that effective date or on or after the expiration of a binding collective negotiations agreement in force on that effective date if the terms of that agreement concerning health care benefits payment obligations in retirement have been deemed applicable by the employer to those employees, and who retire on or after that effective date or expiration date, excepting employees who elect deferred retirement, when the employer has assumed payment obligations for health care benefits in retirement for such an employee.
(3) Employees described in paragraph (2) of this subsection who have 20 or more years of creditable service in one or more State or locally-administered retirement systems on the effective date of P.L.2011, c.78 shall not be subject to the provisions of this subsection.
The amount payable by a retiree under this subsection shall not under any circumstance be less than the 1.5 percent of the monthly retirement allowance, including any future cost of living adjustments thereto, that is provided for such a retiree, if applicable to that retiree, under subsection b. of N.J.S.40A:10-23. A retiree who pays the contribution required under this subsection shall not also be required to pay the contribution of 1.5 percent of the monthly retirement allowance under subsection b. of N.J.S.40A:10-23.
c. A local unit may enter into a contract or contracts to provide health care benefits, including prescription drug benefits and other health care benefits, as may be required to implement a duly executed collective negotiations agreement, and may provide through such agreement for an amount of employee or retiree contribution as a cost share or premium share that is other than the percentage required under subsection a. or b., or both, of this section, if the total aggregate savings during the term of that agreement from such contributions or plan design, or both, from that agreement as applied to employees and retirees covered by that agreement, and to employees and retirees not covered by that agreement but to whom the agreement has been applied by the employer, if any, equals or exceeds the annual savings that would have resulted had those employees or retirees made the contributions required under subsection a. or b., or both, of this section plus the annual savings resulting to the plans within the State Health Benefits Program as a result of plan design changes made pursuant to P.L.2011, c.78.
A local unit shall certify the savings in writing to the Division of Local Government Services in the Department of Community Affairs and the Division of Pensions and Benefits in the Department of the Treasury. The Department of Community Affairs shall review and approve or reject the certification within 30 days of receipt. The certification shall be deemed approved if not rejected within that time. The agreement shall not be executed until that approval is received or the 30-day period has lapsed, whichever occurs first.
d. The contribution under subsection a. of this section shall commence: (1) upon the effective date of P.L.2011, c.78 for employees who do not have a majority representative for collective negotiations purposes, notwithstanding that the terms of an applicable collective negotiations agreement binding on the employer have been applied or have been deemed applicable to those employees by the employer, or have been used to modify the respective payment obligations of the employer and those employees in a manner consistent with those terms, before that effective date; and (2) upon the expiration of any applicable binding collective negotiations agreement in force on that effective date for employees covered by that agreement with the contribution required for the first year under subsection a. of this section commencing in the first year after that expiration, or upon the effective date of P.L.2011, c.78 if such an agreement has expired before that effective date with the contribution required for the first year under subsection a. of this section commencing in the first year after that effective date.
Once those employees are subjected to the contribution requirements set forth in subsection a. of this section, the public employers and public employees shall be bound by this act, P.L.2011, c.78, to apply the contribution levels set forth in section 39 of this act until all affected employees are contributing the full amount of the contribution, as determined by the implementation schedule set forth in subsection a. of this section. [Notwithstanding the expiration date set forth in section 83 of this act, P.L.2011, c.78, or the expiration date of any successor agreements, the parties shall be bound to apply the requirements of this paragraph until they have reached the full implementation of the schedule set forth in subsection a. of this section.]
As may be permitted by law or otherwise, the authority to determine an amount of contribution at the discretion of the employer or by means of a binding collective negotiations agreement, and by means of the application of the terms of such an agreement to employees who do not have a majority representative for collective negotiations purposes, or the modification of the respective payment obligations of the employer and those employees in a manner consistent with the terms of such an agreement, shall remain in effect with regard to contributions, whether as a share of the cost, or percentage of the premium or periodic charge, or otherwise, in addition to the contributions required under subsections a. and b. of this section.
This section shall apply when the health care benefits are provided through self insurance, the purchase of commercial insurance or reinsurance, an insurance fund or joint insurance fund, or in any other manner, or any combination thereof.
This section shall apply to counties and municipalities, and any agency, board, commission, authority, or instrumentality of a local unit, fire districts, or other entities created by a county or municipality, and to county colleges.
Amounts deducted from a retiree's benefit pursuant to subsection b. of this section shall be paid to the retiree's former employer, as appropriate.
All other provisions of law shall remain applicable to the extent not inconsistent with this section.
e. Any extension, alteration, re-opening, amendment or other adjustment to a collective negotiations agreement in force on the effective date of P.L.2011, c.78, or to an agreement that is expired on that effective date, shall be considered a new collective negotiations agreement entered into after that effective date for the purposes of this section.
(cf: P.L.2011, c.78, s.42)
4. Section 43 of P.L.2011, c.78 (C.52:14-17.34a) is amended to read as follows:
43. As used in this section, "independent State authority" means a public authority, board, commission, corporation, or other agency or instrumentality of the State allocated, in but not of, a principal department of State government pursuant to Article V, Section IV, paragraph 1 of the New Jersey Constitution, or which is not subject to supervision or control by the department in which it is allocated, and a regional authority, but shall not include a college or university.
Notwithstanding the provisions of any other law to the contrary, public employees of an independent State authority who are not subject to the provisions of section 40 of P.L.2011, c.78 (C.52:14-17.28d) shall contribute, through the withholding of the contribution from the pay, salary, or other compensation or from the monthly retirement allowance, toward the cost of health care benefits coverage for the employee and any dependent provided by the authority during active service and in retirement in an amount that shall be determined as closely as possible in accordance with sections 39 and 40 of P.L.2011, c.78 (C.52:14-17.28c and C.52:14-17.28d).
Once those employees are subjected to the contribution requirements set forth in this section, the public employers and public employees shall be bound by this act, P.L.2011, c.78, to apply the contribution levels set forth in section 39 of this act until all affected employees are contributing the full amount of the contribution, as determined by the implementation schedule set forth in subsection a. of section 40 of this act. [Notwithstanding the expiration date set forth in section 83 of this act, P.L.2011, c.78, or the expiration date of any successor agreements, the parties shall be bound to apply the requirements of this paragraph until they have reached the full implementation of the schedule set forth in subsection a. of section 40 of this act.]
(cf: P.L.2011, c.78, s.43)
5. Section 44 of P.L.2011, c.78 (C.40A:5A-11.1) is amended to read as follows:
44. As used in this section, "local authority" means an "authority" as defined under the "Local Authorities Fiscal Control Law," P.L.1983, c.313 (C.40A:5A-1 et seq.).
Notwithstanding the provisions of any other law to the contrary, public employees of a local authority who are not subject to the provisions of sections 40 and 42 of P.L.2011, c.78 (C.52:14-17.28d and C.40A:10-21.1) shall contribute, through the withholding of the contribution from the pay, salary, or other compensation or from the monthly retirement allowance, toward the cost of health care benefits coverage for the employee and any dependent provided by the local authority during active service and in retirement in an amount that shall be determined as closely as possible in accordance with sections 39 and 42 of P.L.2011, c.78 (C.52:14-17.28c and C.40A:10-21.1).
Once those employees are subjected to the contribution requirements set forth in this section, the public employers and public employees shall be bound by this act, P.L.2011, c.78, to apply the contribution levels set forth in section 39 of this act until all affected employees are contributing the full amount of the contribution, as determined by the implementation schedule set forth in subsection a. of section 42 of this act. [Notwithstanding the expiration date set forth in section 83 of this act, P.L.2011, c.78, or the expiration date of any successor agreements, the parties shall be bound to apply the requirements of this paragraph until they have reached the full implementation of the schedule set forth in subsection a. of section 40 of this act.]
(cf: P.L.2011, c.78, s.44)
6. Section 83 of P.L.2011, c.78 (Effective Date) is amended to read as follows:
83. This act shall take effect immediately [, and sections 39 through 44, inclusive, shall expire four years after the effective date].
7. The following sections are repealed:
Section 77 of P.L.2011, c.78 (C.52:14-17.28e);
Section 78 of P.L.2011, c.78 (C.18A:16-17.2); and
Section 79 of P.L.2011, c.78 (C.40A:10-21.2).
8. This act shall take effect immediately.
STATEMENT
P.L.2011, c.78 requires public employees to pay a percentage of the cost of the health care benefits coverage provided to them by their public employer. This requirement is set to expire four years after June 28, 2011 or later than that for certain public employers and public employees who were allowed under certain circumstances to begin implementation after the law's effective date.
This bill removes the provisions of law that provide for the expiration. Therefore, the payment as set forth in the statutes will become a permanent requirement.
The percentages to be paid are identified in the law, beginning at 3 percent and increasing to 35 percent for salary ranges set at intervals of $5,000. The percentages vary based upon type of coverage: family, individual, or member with child or spouse coverage. A four-year payment schedule commenced on the law's effective date for certain public employees and upon the expiration of a collective negotiation agreement for others.
P.L.2011, c.78 also requires certain public employees in retirement to pay a percentage of the cost of health care benefits coverage. This requirement applies to certain who accrue 25 years of service after the law's effective date, or after the expiration of an applicable collective bargaining agreement in effect on that date, and retire after that date. These retirees are required to use the annual pension amount, instead of salary, to identify the applicable percentage. This requirement does not apply to public employees who had 20 or more year of service on June 28, 2011 in one or more State or locally-administered retirement systems.
If the payment provisions of this law do expire, those percentages become part of the collective negotiations between public employers and active public employees and will then be subject to collective negotiations in a manner similar to other negotiable items between the parties. A public employee whose amount of contribution was determined in accordance with the expired provisions must pay that amount in retirement regardless of the expiration.
