Toms River In Compliance On Sick Leave Payouts, Officials Say

TOMS RIVER, NJ — Toms River officials are rejecting a report by the New Jersey state comptroller's office that says the township is violating state laws on sick time compensation.

The state, in a report distributed last week, looked at employee contracts and ordinances in 60 towns and said 57 of those towns were in violation of state laws passed in 2007 and 2010 to limit payouts for sick time when an employee retired. Toms River, which was among the towns examined, had five contracts that did not comply with the state law, according to the comptroller's office.

In a resolution approved by the Township Council Wednesday night and supplied by business administrator Louis Amoruso after the meeting, the township refuted the claims in the comptroller's report, saying some of it was based on outdated information and other parts ignored more-restrictive policies Toms River has in place.

The state comptroller's office report said Toms River's contracts violated the state's sick leave payment law by allowing payment of accrued sick leave at times other than retirement, and five of them allow for accrued sick leave payments annually for employees hired after May 21, 2010.

The state law limiting accrued sick leave payments to $15,000 at retirement took effect May 21, 2010; a 2007 law imposed those limits for administrators, department heads and other senior employees. The laws barred annual payouts of accumulated sick leave along with the $15,000 retirement payment limit.

But Toms River officials, in the rebuttal letter to the comptroller's office, said several of the contracts reviewed in the 2020 report by the comptroller's office have since expired, and the new pacts negotiated in 2021 and 2022 were updated with language that complies with the state law.

"Notably, the report did not find that Toms River actually made any payments in violation of (the law). Rather, the report mainly took issue with the language of the Township's now-expired collective negotiations agreements, several of which did not expressly limit certain sick-leave based incentives". The letter noted that all of the contracts contained a clause that says state laws are govern, meaning anything that isn't expressly compliant still must follow state law.

Township officials also question whether the provision of the contract that covers its dispatchers of paying out accumulated sick time to the beneficiary as a death benefit actually violates the law. "Nevertheless, based on the Comptroller's interpretation of the statute, the Township will, going forward, limit (the) benefit" to employees hired before May 21, 2010, the letter says.

The letter says a $500 attendance bonus available twice a year in two contracts, one that covers dispatchers and one that covers rank-and-file police officers, helps to limit law enforcement overtime, "resulting in significant taxpayer savings." It asks the comptroller's office to reconsider the ruling that it is illegal.

Two contracts that do not expressly prohibit sick leave payouts exceeding $15,000 will be amended to include the language, officials said, and corresponding policies that cover employees who are not covered by union contracts will be updated as well, the letter said.

"To reiterate, the Comptroller's concerns are largely semantic," the letter says, because the language regarding accumulated sick time payments already has been addressed in new contracts or will be addressed shortly.

"It should also be noted that, overall, Toms River's policies and contractual provisions ... are not only consistent with state law, but more taxpayer-protective," the letter says, because employees hired after 2014 are not eligible for any sick time payouts at retirement.

"For other employees, sick time earned after December 31, 2013, is ineligible for payout at retirement and those employees are capped at the lesser of the amount accrued as of that date or $15,000," the letter said. "These are arguably some of the strictest limitations on supplemental compensation for accumulated sick leave in New Jersey and ultimately will drive Toms River's costs for these payments near zero — a much sought-after goal that has so far eluded the Legislature."