N.J. Association of Sch. Administrators v. Schundler

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In 2007, the Legislature passed a series of reform measures designed to lower property taxes. Among other issues, the reforms attempted to address the problem of excessive benefits for high-level school administrators. The following year, the Commissioner of Education issued various regulations to implement the new laws. The regulations limited certain benefits in new contracts for high-level administrators, and also capped payments for accumulated unused sick leave. In 2008, Plaintiffs-Respondents the New Jersey Association of School Administrators, Dr. Terry Van Zoeren, Dr. Simon Bosco, Joseph Abate, Jr., and John Golden filed a complaint seeking to enjoin the use of the regulations, as well as other provisions in N.J.A.C. 6A:23A-3.1(e) on federal constitutional and state law grounds. The court denied the application for a preliminary injunction and dismissed the lawsuit. The court declined to exercise jurisdiction under the doctrine known as "Burford" abstention, to allow the state courts the opportunity to determine important questions of state law. The Appellate Division held that the challenged regulations impermissibly reduced the compensation of tenured assistant superintendents, in violation of the tenure statute, and improperly deprived certain administrators of vested rights. The Appellate Division also concluded that the challenge to the sick leave cap was partially mooted by a newly enacted law. Upon review, the Supreme Court concluded that the Legislature had the authority to modify terms and conditions for future contracts for public employment in a manner that did not raise constitutional concerns. Furthermore, the Legislature properly exercised its power when it directed the Commissioner to issue regulations for new contracts for superintendents and assistant superintendents. The regulations that followed were consistent with their respective enabling statutes and advanced the Legislature's goals. They also protected benefits that employees had already accumulated. Accordingly, the Court reversed the judgment of the Appellate Division.