ROBBINSVILLE EDUCATION ASSOCIATION VS. ROBBINSVILLE BOARD OF EDUCATION (L-2447-19, MERCER COUNTY AND STATEWIDE)

NOT FOR PUBLICATION WITHOUT THE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-3459-19

ROBBINSVILLE EDUCATION
ASSOCIATION,

Plaintiff-Appellant,

v.

ROBBINSVILLE BOARD OF
EDUCATION,

Defendant-Respondent.
____________________________

Argued August 2, 2021 – Decided August 16, 2021

Before Judges Mawla and Rose.

On appeal from the Superior Court of New Jersey, Law
Division, Mercer County, Docket No. L-2447-19.

Sanford R. Oxfeld argued the cause for appellant
(Oxfeld Cohen, PC, attorneys; Sanford R. Oxfeld, of
counsel and on the brief; Jesse Humphries, on the
brief).

Matthew J. Giacobbe argued the cause for respondent
(Cleary Giacobbe Alfieri Jacobs, LLC, attorneys;
Matthew J. Giacobbe, of counsel and on the brief).
PER CURIAM

Plaintiff Robbinsville Education Association (Association) appeals from

a March 26, 2020 Law Division order affirming an arbitration award entered in

favor of defendant Robbinsville Board of Education (Board). We affirm.

Pursuant to paragraph 14.1 of a collective negotiations agreement (CNA),

the parties agreed as follows:

Healthcare Coverage: The Board shall provide
healthcare coverage . . . equal to the New Jersey School
Employees' Health Benefits Program (SEHBP) Direct
15.[1] As required by [New Jersey] law under the
provisions of Chapter 78, P.L. 2011, [2] employees are
required to pay a contribution toward the cost of health
benefits coverage based on a specified percentage of
the medical and prescription drug plan premiums. The
Board . . . assumes the balance of the costs per this
[a]greement.

In 2018, the Board proposed a change to the health benefit administration

by implementing a "Difference Card" that Association members could use to

pay for medical services for the 2018-19 school year. The prior school year, the

Board provided three health plans including one through Aetna, which had a

1
The Direct 15 health plan has a fifteen-dollar co-pay.
2
Chapter 78 codified as N.J.S.A. 52:14-17.28c, collectively with N.J.S.A.
18A:16-17.1(a), governs the provision of health care coverage for school board
employees, the percentage of contribution by employees to their medical
coverage, and negotiation of these obligations by means of a CNA.
A-3459-19
2
fifteen-dollar co-pay in accordance with paragraph 14.1 of the CNA. The plan

cost the Board $4,448,201. However, in May 2018, Aetna advised the Board

the cost for the same plan for 2018-19 school year would increase by nine

percent to $4,848,491. As a result, the Board discontinued the fifteen-dollar co-

pay plan and maintained three plans with Aetna each requiring a fifty-dollar co-

pay. It then contracted with Difference Card to provide Association members

with credit cards to pay the thirty-five-dollar difference between their fifteen-

dollar co-pay under the CNA and the fifty dollars required by the less expensive

Aetna plan. The new plan cost the Board $3,032,318; the Difference Card

charged the Board $844,718 to cover the difference in co-pays; and the Board's

total cost for providing insurance was $3,877,036 for the 2018-19 school year.

The Association filed a grievance and request for binding arbitration with

the Public Employment Relations Commission (PERC). Pursuant to the parties'

agreement, PERC designated an arbitrator who considered the evidence and

heard testimony from Alexander DeVicaris, a New Jersey Education

Association (NJEA) field representative, on behalf of the Association, and

Joseph Columbo, an insurance broker, on behalf of the Board. The arbitrator

issued a detailed twenty-two-page written decision, and at the outset framed the

question presented as follows: "Did the Board violate Article 14.1 of the parties'

A-3459-19
3
[CNA] or the related statutes with regard to the Chapter 78 contributions the

employees were required to pay toward their health benefits in the 2018-2019

school year? If so, what shall be the remedy?"

The Association argued the Board violated the CNA and the law because

Difference Card was not an insurance carrier or health care provider and instead

issued a "carrier neutral" credit card, which did not provide medical benefits, to

pay claims. The Association also argued the cost paid to Difference Card was

not chargeable to its members because it was not a fixed insurance premium, but

could increase depending on the cost of the claims in a given year. The

Association claimed the Board should pay twenty percent of the Board's cost for

the Difference Card, or $168,944.

The Board argued it violated neither the CNA nor the statute because the

co-pay remained at fifteen dollars and the amount paid by the Difference Card

represented a portion of the insurance premium, which happened to be self-

insured. The Board claimed the Difference Card was a form of self-insurance

as defined by Section 39 of Chapter 78, which states:

As used in this section, "cost of coverage" means the
premium or period charges for medical . . . plan
coverage . . . provided under the . . . [SEHBP]; or the
premium or periodic charges for health care . . .
provided pursuant to P.L.1979, c.391 (C.18A:16-2 et
seq.), [N.J.S.A. 40A:10-16] et seq., or any other law by

A-3459-19
4
 a local board of education, local unit or agency thereof
. . . when the employer is not a participant in the . . .
[SEHBP].

[N.J.S.A. 52:14-17.28c.]

The arbitrator recounted the testimony of both witnesses, noting

DeVicaris testified that a Difference Card employee, who did not testify, told

him Difference Card was not a healthcare provider. The arbitrator stated:

But even if I credit that remark it only means that the
Difference Card itself did not provide medical benefits.
That's true to a certain extent; the Difference Card itself
was not paying to keep the employee co-pay at [fifteen
dollars]. Rather, it was facilitating – or administering
– that result on behalf of the Board by letting the
employee health providers use its credit card to cover
the balance of the [fifty dollar] co-pay. Consequently,
I find that [the non-testifying witness'] remark does not
mean that the Board did not provide a medical benefit
by paying the co-pay difference so that the employees'
health care plan would remain at the [fifteen dollar] co-
pay.

. . . [T]he cost to maintain and/or to lower the co-
pay must be part of the overall premium or cost of the
overall health benefit plan. Based thereon I find that
the [thirty-five dollars] the Board paid the Difference
Card towards the co-pay was part of the medical benefit
that the Board was required to provide for the
employees as part of their overall medical benefits.
Even DeVicaris recognized that the co-pay is part of a
health plan[']s medical expense.

A-3459-19
5
 The arbitrator concluded although the Difference Card was not an

insurance carrier or provider, "it did provide a medical benefit paid by the

Board." Furthermore, citing Article 14.1 of the CNA, the arbitrator noted it did

not require the Board to provide insurance solely through a carrier. Rather, the

"Article only requires a contribution to the cost of health coverage based upon

a percentage of the medical and prescription drug plan premiums." Canvassing

the exhibits entered into evidence, the arbitrator could find no requirement that

insurance be provided only through a carrier.

The arbitrator concluded the Difference Card was a form of self-

insurance. He stated:

I see very little difference between the Board paying
Aetna a higher cost – or premium – to provide a [fifteen
dollar] co-pay plan and the Board paying the Difference
Card a cost – or premium – to maintain a [fifteen dollar]
co-pay plan for the employees. In both situations it is
the Board that pays a cost to a company – as part of its
overall health benefit premium – to provide the
employees with the [fifteen dollar] co-pay benefit.

The Arbitrator also credited Columbo's testimony, which stated the

Difference Card acted as a form of third-party administrator of benefits and was

a form of self-insurance because it employed actuaries to determine its rates by

considering "the group claims experience and how much is needed to cover the

full cost of the claims plus the [Difference Card's] expenses." The arbitrator

A-3459-19
6
noted DeVicaris testified "he was unfamiliar with self-insurance plans; and he

certainly did not dispute Columbo's testimony."

The arbitrator rejected the Association's argument the Difference Card

was a form of health savings account, noting such accounts are created by

employees because of the benefits of funding an account with pre-tax earnings,

and are not funded by employers. The arbitrator also found the fact that the cost

of the Difference Card could fluctuate based on the claims it processed did not

mean it was not a form of self-insurance because its purpose was to "provid[e]

the employees the required lower co-pay."

The arbitrator concluded as follows:

Thr[ough] the Difference Card the Board is providing
part of the contractually required coverage. . . . The
Board alone – in part due to the language in Article 14.1
of the parties' [a]greement – is responsible for any
increase in co-pay claims the Difference Card may
subsequently charge the Board. Absent a negotiated
agreement on this point, the employees are not required
to pay contributory shares on any such increase.

Addressing the statute, the arbitrator concluded as follows:

Combining the premium for the Aetna [fifty
dollar] co-pay fully-insured plan and the premium for
the Difference Card co-pay self-insured plan for
purposes of determining an employee's required
Chapter 78 contribution seems consistent with the
[CNA] and the law. [See] . . . N.J.S.A. 40A:10-21.1(d)
which provides in pertinent part:

A-3459-19
7
 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.
[(Emphasis added).]

[The highlighted language] fits what happened
here. The Board found another way, another manner,
in which to provide the [fifteen dollar] co-pay at a lower
cost, but that self-insured cost combined with the fully
funded cost for the Aetna [fifty dollar] co-pay plan
resulted in the combined premium upon which the
employee contributory share was determined.

The arbitrator denied in part the grievance concluding the Board did not

violate the CNA by including the Difference Card in its overall health benefits

premium. However, the arbitrator held that if the Difference Card claims for

2018-19 were less than the $844,718 premium paid, the Board had to

immediately notify the Association of the sum refunded to the Board and

negotiate "how best to return the employees['] contributory share from such

money [and] . . . the negotiable aspects of [the CNA, including] the use of the

Difference Card plan for the 2019-2020 school year."

The Association filed an order to show cause and verified complaint

asking the Law Division judge to vacate the arbitrator's award and "determine

that no staff member should have been required to make Chapter 78

A-3459-19
8
contributions on the cost of the Difference Card." The trial judge reviewed the

parties' submissions and heard oral argument on the order to show cause.

As part of the Association's submissions, it included a certification from

an NJEA associate director of research and economic services who did not

testify before the arbitrator. The certification opined the arbitrator made "most

of the correct factual findings, [but had] misconstrued the law," namely, Chapter

78, in concluding the Difference Card was a form of self-insurance. The affiant

certified he reviewed the Difference Card website, which stated: "The

Difference Card works like a credit card to offset copays and deductibles" and

therefore was not a form of medical insurance premium. Additionally, citing

the website, he noted Difference Card did not hold itself out as a third -party

administrator of health benefits. The certification concluded this information

was "directly contrary to the arbitrator's ruling."

The Board's counsel objected to the judge's consideration of the

certification on hearsay grounds pursuant to Rule 1:6-6 and because the affiant

was present at the arbitration, but never called to testify. The trial judge

concluded he would consider the factual assertions made because they were

derived from the Difference Card website, which did not require testimony , but

A-3459-19
9
would not consider the legal arguments raised by the affiant because the

Association's counsel could articulate them.

Association counsel argued the judge should vacate the arbitration award

pursuant to N.J.S.A. 2A:24-8(a) because the arbitrator's finding that the

Difference Card was a form of insurance premium chargeable to Association

members constituted a mistake of law. Counsel also argued the award should

be vacated under N.J.S.A. 2A:24-8(d) because the arbitrator failed to consider

Chapter 78 despite identifying the statute in the issue to be arbitrated.

The trial judge rejected the Association's arguments. He concluded the

arbitrator's finding the Difference Card was a form of insurance premium was

supported by the record and

fits within the terms of the statute and since its cost of
coverage, it also fits within the terms of the contract. I
don't know how else to see it [except as] periodic
coverage for medical. That's what it was. It was for a
set period, 2018/2019, it is for medical and it's for the
coverage.

The trial judge rejected the arguments made in the certification from the

NJEA associate director, namely that the Difference Card website states it is not

a form of insurance. The judge stated:

I'm not constrained to have to do what the Difference
Card says and neither was the arbitrator. They can

A-3459-19
10
 claim whatever they want in their advertisements and
for their business model.

The fact of the matter is essentially it's a self-
insurance. They administer it for the . . . Board and I
take it that the . . . Board is probably not that expert in
things like invoices and billing codes and all the things
that need to be done to be able to sort these things out.
So[,] it makes sense that they got somebody else to do
it.

The judge entered the order affirming the arbitration award.

I.

Recently, our Supreme Court framed the principles guiding our review.

Writing for the Court, Justice Pierre-Louis stated:

To foster finality and "secure arbitration's speedy and
inexpensive nature," reviewing courts must give
arbitration awards "considerable deference." [Borough
of E. Rutherford v. E. Rutherford PBA Loc. 275, 213
N.J. 190, 201 (2013)] (quoting Middletown Twp. PBA
Loc. 124 v. Twp. of Middletown, 193 N.J. 1, 10
(2007)). "[A]rbitration is 'meant to be a substitute for
and not a springboard for litigation.' Arbitration should
spell litigation's conclusion, rather than its beginning."
N.J. Tpk. Auth. v. Loc. 196, IFTPE, 190 N.J. 283, 292
(2007) (quoting Loc. No. 153, Off. & Pro. Emps. Int'l
Union v. Tr. Co. of N.J., 105 N.J. 442, 449 (1987)).

The interpretation of a labor agreement "is a
question for the arbitrator. It is the arbitrator's
construction which was bargained for; and so far as the
arbitrator's decision concerns construction of the
contract, the courts have no business overruling him [or
her]" based solely on differences of interpretation. E.

A-3459-19
11
 Rutherford PBA, 213 N.J. at 202 (quoting Weiss v.
Carpenter, Bennett & Morrissey, 143 N.J. 420, 433
(1996)). Accordingly, an arbitrator's award resolving a
public sector dispute will be accepted so long as the
award is "reasonably debatable." Id. at 201-02.

Under the reasonably debatable standard, a court
"may not substitute its own judgment for that of the
arbitrator, regardless of the court's view of the
correctness of the arbitrator's position." Ibid. (quoting
Middletown Twp. PBA, 193 N.J. at 11). Put
differently, if two or more interpretations of a labor
agreement could be plausibly argued, the outcome is at
least reasonably debatable. See id. at 206; PBA Loc.
11 v. City of Trenton, 205 N.J. 422, 430 (2011). "Thus,
even if the remedy the Arbitrator fashioned was not the
preferred or correct outcome, a reversal would be
contrary to the deferential standard for reviewing
arbitral decisions." E. Rutherford PBA, 213 N.J. at
206.

[Borough of Carteret v. Firefighters Mut. Benevolent
Ass'n, Loc. 67, ___ N.J. ___, ___ (2021) (slip op. at 11-
12) (second and third alterations in original).]

In pertinent part, the New Jersey Arbitration Act also permits a court to

vacate an arbitration award in any one of the following cases: "[w]here the

award was procured by . . . undue means" or "[w]here the arbitrators exceeded

or so imperfectly executed their powers that a mutual, final and definite award

upon the subject matter submitted was not made." N.J.S.A. 2A:24-8.

The Association raises the following arguments: (1) because the issue

before the arbitrator concerned the statutory interpretation of Chapter 78, we

A-3459-19
12
should exercise de novo review because the dispute is "a purely legal issue;" (2)

the trial judge erred by failing to vacate the award pursuant to N.J.S.A. 2A:24-

8(a) and (d); (3) the arbitration award is invalid because the arbitrator failed to

decide the issue presented, namely, whether the Board had violated Chapter 78;

and (4) the trial judge erred because the Difference Card is not health insurance

that is chargeable to Association members under Chapter 78. We address these

arguments in turn.

We decline to exercise a de novo review because the arguments raised by

the Association are not "purely legal." Even if this were so, as we have

expressed, our scope of review is narrow and requires us to consider whether

the arbitration award is reasonably debatable. Contrary to the Association's

argument, neither the arbitrator nor the trial judge ignored Chapter 78 or

misapplied the law. The arbitrator made detailed findings explaining how the

Difference Card satisfied the Board's obligation to provide the insurance

coverage required by Chapter 78 and the requirement that the Board and the

Association enter into negotiations in the event of a premium refund from the

Difference Card. For these reasons, a de novo review is unwarranted.

The Association argues the award should be vacated pursuant to N.J.S.A.

2A:24-8(a) because the award was procured by "undue means," namely, the

A-3459-19
13
arbitrator committed mistakes of fact and law. In this regard, the Association

urges us to consider the certification it submitted to the trial judge from the

NJEA representative, which purported to explain why the Difference Card was

not a form of Chapter 78 compliant medical insurance. However, the

certification was produced four months after the arbitrator's ruling and the

Association could have adduced testimony from the affiant during the arbitration

proceedings, but did not. Notwithstanding the failure to have the affiant testify,

the judge did consider the factual assertions made in the post-arbitration

certification. We discern no error on the part of the trial judge and the

certification does not prove the sort of mistake envisioned under N.J.S.A.

2A:24-8(a) to warrant vacation of the arbitration award.

The balance of the arguments raised by the Association urging us to vacate

the award on grounds of mistake challenge the arbitrator's finding that the funds

paid to the Difference Card constituted a form of self-insurance. The

Association argues the arbitrator ignored DeVicaris's testimony, which

explained that Difference Card was not a form of insurance. Citing the

Department of Education and Aetna's definitions of health insurance premiums,

namely, "the payment made to maintain a health insurance policy" and "regular

payments to keep [a] health care plan active," the Association argues the

A-3459-19
14
arbitrator erred because the Difference Card "does not match" such definitions

and "the Difference Card serves absolutely no purpose in maintaining an active

health insurance policy." The Association also asserts the arbitrator ignored the

Difference Card's own representations that it was carrier neutral and was not a

health insurance provider.

Again, we discern no error requiring our intervention under N.J.S.A.

2A:24-8(a). Initially, we note the arbitrator did not ignore any evidence,

including DeVicaris's testimony. Rather, it is evident the arbitrator found

Columbo's testimony and the Board's evidence more persuasive. Moreover,

contrary to the assertions made in its brief, the Association's challenge is rooted

in its disagreement with the arbitrator's factual findings and conclusions of law.

In Borough of Carteret, the Supreme Court confronted a similar scenario.

There, the CNA stated senior firefighters were entitled to an acting captain's pay

when they performed the duties of a fire captain. ___ N.J. at ___ (slip op. at 2).

However, the Borough avoided paying the higher pay by creating a lieutenant

position within the fire department. Id. at ___ (slip op. at 4-5). At the ensuing

arbitration hearing, the Borough presented testimony that the firefighter's union

agreed to waive the captain's pay if the Borough created the lieutenant position.

Id. at ___ (slip op. at 6). The union presented testimony that there was no such

A-3459-19
15
agreement. Both parties agreed the lieutenants were performing a captain's duty.

Ibid.

The arbitrator sided with the union and found the Borough had violated

the CNA and awarded back pay at the captain's rate. Ibid. The arbitrator's

written opinion addressed both witnesses' testimony and explained why the

arbitrator had decided to credit the testimony of the union's witness over the

Borough's. Id. at ___ (slip op. at 7). The trial court upheld the award and denied

the Borough's request to vacate it pursuant to N.J.S.A. 2A:24-8(d). Id. at ___

(slip op. at 8).

We reversed and vacated the arbitrator's award holding the arbitrator had

"engrafted" language into the CNA and the agreement's plain language showed

it did not apply to lieutenants. Ibid. Moreover, as explained by the Supreme

Court,

[t]he Appellate Division was persuaded by the Civil
Service Commission's job descriptions for fire
personnel. It noted that absent from the job description
for firefighters was any provision suggesting that a
firefighter must assume captain's duties when a captain
is not scheduled. Consequently, when a firefighter
performs captain's duties, the firefighter is performing
work beyond his or her job description. According to
the court, that is why [the CNA] provides for greater
compensation in those instances. The Civil Service
Commission's description of fire lieutenants, by
contrast, expressly directs that a lieutenant "[act] in the

A-3459-19
16
 place of a Fire Captain in his/her absence." The
Appellate Division found nothing in the record to
support the FMBA's argument that lieutenants should
receive acting captain's pay "for performing work
within their job description."

Finding that the difference between firefighters'
and fire lieutenants' job descriptions created
uncertainty as to [CNA's] application to lieutenants, the
Appellate Division concluded that the arbitrator should
have given greater consideration to the parties' past
practice; namely, that for four years, lieutenants in the
Carteret Fire Department regularly assumed captains'
responsibilities without demanding pay beyond that to
which they were ordinarily entitled.

[Id. at ___ (slip op. at 8-9) (third alteration in original).]

The Supreme Court reversed, reinstated the award, and held as follows:

Although the Appellate Division's conclusion is
arguably plausible in its own right, the court improperly
substituted its own judgment for that of the arbitrator in
vacating the arbitral award. We find that the arbitrator's
award is supported by a reasonably debatable
interpretation of the disputed provision, and therefore,
the award should have been upheld on appeal.

....

As our precedent indicates, affirming an
arbitrator's award is not a comment on the viability of
opposing interpretations of a disputed labor agreement,
"[n]or is it a conclusion that the arbitrator's
interpretation is the best one. That is not the standard.
What is required is that the arbitrator's interpretation
finds support in the Agreement . . . ." PBA Loc. 11,
205 N.J. at 432. Here, we find that it does.

A-3459-19
17
 [Id. at __ (slip op. at 2-3, 16) (alterations in original).]

The same principles apply here. The arbitrator explained his reasons for

deciding in Board's favor, having considered all the evidence, testimony, and

legal arguments presented. Although the arbitrator could have reached the

outcome the Association desired based on the same record, it is not our role to

second guess the result because it is reasonably debatable.

The Association claims the Arbitrator violated N.J.S.A. 2A:24-8(d)

because "Chapter 78 is included in the statement of the issue to be decided by

the arbitrator as well as in the [CNA] by reference and by failing to read both

together, the arbitrator imperfectly executed his powers so that a final award

was not issued." We disagree.

The trial judge found the arbitrator did address Chapter 78, stating "that

the money was charged for medical for a given . . . period . . . [and] in fact[] fits

within the terms of the statute . . . ." The judge concluded as follows:

So[,] Section 39 of Chapter 78 says that the premium of
periodic charges for medical and that's what I'm saying
. . . and that's where we've defined it as the cost of
coverage. So the premium is . . . what it costs. The
period is 2018/2019 and it's for medical. The other
three elements were met and that's why I find that it
meets that statute.

A-3459-19
18
 This argument and the Association's remaining argument that the record

does not support a finding the Difference Card was a form of health insurance

chargeable under Chapter 78 lack sufficient merit to warrant further discussion

in a written opinion. R. 2:11-3(e)(1)(E).

Affirmed.

A-3459-19
19