LAURA SHAW v. BOARD OF TRUSTEES PUBLIC EMPLOYEES RETIREMENT SYSTEM

NOT FOR PUBLICATION WITHOUT THE
                               APPROVAL OF THE APPELLATE DIVISION
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                                                        SUPERIOR COURT OF NEW JERSEY
                                                        APPELLATE DIVISION
                                                        DOCKET NO. A-2216-20

LAURA SHAW,

          Plaintiff,

v.

BOARD OF TRUSTEES,
PUBLIC EMPLOYEES'
RETIREMENT SYSTEM,

     Defendant.
_________________________

                   Submitted December 6, 2021 – Decided December 14, 2021

                   Before Judges Fasciale and Vernoia.

                   On appeal from the Board of Trustees of the Public
                   Employees' Retirement System, Department of
                   Treasury, PERS Nos. x-xxxx353 and x-xxxx725.

                   Laura Shaw, appellant pro se.

                   Andrew J. Bruck, Acting Attorney General, attorney for
                   respondent, (Donna Arons, Assistant Attorney General,
                   of counsel; Christopher Meyer, Deputy Attorney
                   General, on the brief).

PER CURIAM
       Laura Shaw appeals from a February 18, 2021 final agency decision by

the Board of Trustees (Board) of the Public Employees Retirement System

(PERS) denying her request to extend the expiration period on her Tier  1 PERS

account 1    The Board concluded that under  N.J.S.A. 43:15A-7(e), Shaw's

membership in the retirement system ended because she did not commence

PERS-covered employment within two years of her last contribution, which

caused her PERS Tier 1 membership to expire.

       The Division of Pension and Benefits (Division) can extend the two-year

expiration period, but the Board determined that the extension opportunity is not

automatic. Here, the Board found that Shaw obtained a PERS-covered position

after expiration of the two years, and therefore the Board concluded that she was

not entitled to the extension under  N.J.S.A. 43:15A-8(a).        It reached that

conclusion without a hearing in the Office of Administrative Law (OAL)

because it found the facts were undisputed.

       On appeal, Shaw argues the decision is arbitrary because she was without

fault for the delay, and she was within a ten-year period referenced in  N.J.S.A.

43:15A-8(a). Shaw urges us to vacate the decision and remand for a hearing in

the OAL.


 1 Since her Tier 1 membership expired, Shaw enrolled as a Tier 5 member.
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      Shaw did not leave her job, as the tax collector for the Borough of Seaside

Heights, voluntarily without good cause attributable to the work. Thus, she was

not disqualified for unemployment benefits under  N.J.S.A. 43:21-5(a). In other

words, it was purportedly not her fault that she was separated from employment.

Applying the text of  N.J.S.A. 43:15A-8(a), she contends, therefore, the Board's

decision was unreasonable. And she argues her work history, pension status,

and job search documentation demonstrate that her separation from employment

was not her fault in any way. She also asserts that she has put in substantial

time into the system, more than fifteen years.

      Citing Lally,2 Cologna,3 and Del Pomo,4 the Board argues the  N.J.S.A.

43:15A-8(a) exception permitting an extension is "discrete and limited." It

maintains that since Shaw resigned and was not involuntarily terminated due to

layoff or workforce reduction, she is not entitled to an extension under  N.J.S.A.

43:15A-8(a). The Board argues Shaw's reference to  N.J.S.A. 43:21-5(a) is



2
  Lally v. Bd. of Trs., Pub. Emps.' Ret. Sys.,  246 N.J. Super. 270 (App. Div.
1991).
3
  Cologna v. Bd. of Trs., Police & Firemen's Ret. Sys.,  430 N.J. Super. 362
(App. Div. 2013).
4
  Del Pomo v. Bd. of Trs., Pub. Emps.' Ret. Sys.,  252 N.J. Super. 430 (App.
Div. 1991).
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misplaced.   And that here, under  N.J.S.A. 43:15A-8(a), fault is irrelevant.

Instead, she must be "discontinued from service." And here, her employer did

not remove her, she was not laid off, and there was no workforce reduction. In

other words, the Board contends she left her job on her own, albeit for reasons

she explains were justified.

      This court has recognized "'[j]udicial review of an administrative agency

action is limited' because respect is due to the 'expertise and superior knowledge'

of an agency in its specialized field." Francois v. Bd. of Trs., Pub. Emps.' Ret.

Sys.,  415 N.J. Super. 335, 347 (App. Div. 2010) (internal quotations omitted)

(quoting Hemsey v. Bd. of Trs., Police & Firemen's Ret. Sys.,  198 N.J. 215, 223

(2009)). An appellate court will only reverse an agency's decision if it is

"arbitrary, capricious or unreasonable or it is not supported by substanti al

credible evidence in the record as a whole." Stevens v. Bd. of Trs., Pub. Emps.'

Ret. Sys.,  294 N.J. Super. 643, 651 (App. Div. 1996) (quoting Henry v. Rahway

State Prison,  81 N.J. 571, 579-80 (1980)).           The party challenging the

administrative action bears the burden of making that showing. Lavezzi v. State,

 219 N.J. 163, 171 (2014).

      It is undisputed that Shaw discontinued her PERS membership for more

than two years. When she resigned from her position with Seaside, the last


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pension contributions for her Tier 1 account were made through March 31, 2017.

She returned to a PERS-covered position in July 2019, more than two years later.

Thus, under  N.J.S.A. 43:15A-7(e), Shaw's Tier 1 account expired before she

returned to PERS-covered employment.

       N.J.S.A. 43:15A-8(a) is a limited exception applicable where an employee

has been involuntarily terminated from service by an employer due to, for

example, a layoff or workforce reduction initiated by the employer.  N.J.S.A.

43:15A-8(a) provides:

            If a member of the retirement system has been
            discontinued from service without personal fault or
            through leave of absence granted by an employer or
            permitted by any law of this State and has not
            withdrawn the accumulated member's contributions
            from the retirement system, the membership of that
            member may continue, notwithstanding any provisions
            of this act if the member returns to service within a
            period of [ten] years from the date of discontinuance
            from service.

      We interpret the plain language of this text to mean discontinued by the

employer. In other words, the discontinuation by the employer of the employee

must be the requisite action, and it must be without the employee's personal

fault. If the employer—without personal fault of the employee—abolishes the

position, for example, then this statute permits continuation if the member

returns to service within ten years.

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     Here, the employer, Seaside, did not discontinue Shaw's position as a tax

collector. Shaw instead discontinued her position—she resigned—albeit for

reasons she explained were justified.      N.J.S.A. 43:15A-8(a) is therefore

inapplicable because Shaw herself voluntarily resigned, and she was not

discontinued by the employer. She was not laid off, and her position was not

abolished. Thus, the Board cannot extend her Tier 1 membership.

     Affirmed.




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