## Facts

- The New Jersey Turnpike Authority, a public employer, operated through an Executive Director and multiple departments under a Board of Commissioners.
- AFSCME Council 73 and related locals sought certification to represent groups of the Authority’s professional, supervisory, and certain managerial employees.
- The Public Employment Relations Commission (PERC) certified three collective negotiations units and rejected the Authority’s claim that most disputed employees were excluded from bargaining as “managerial executives” or “confidential employees” under the New Jersey Employer-Employee Relations Act.
- The Authority challenged PERC’s standards as too narrow, asserting that many disputed employees exercised sufficiently high-level policy authority or had labor-relations duties/knowledge incompatible with unit membership.
- The Appellate Division reversed PERC in significant part, concluding PERC’s interpretations of the statutory exclusions were unduly restrictive.
- The New Jersey Supreme Court granted review, consolidated the matters, modified and affirmed the Appellate Division’s judgment, and remanded to PERC.

## Issues

1. Whether PERC construed “managerial executives” under N.J.S.A. 34:13A-3(f) too narrowly by effectively requiring organization-wide policy authority to exclude employees from collective negotiations units.
2. Whether PERC correctly construed and applied the “confidential employee” exclusion under N.J.S.A. 34:13A-3(g), including what functional responsibilities or knowledge make bargaining-unit membership incompatible with official duties.

## Decision

- The court held PERC’s managerial-executive standard was too narrow and required reconsideration.
- The court rejected the view that managerial-executive status requires organization-wide authority or responsibility for the agency’s overall goals.
- The court held employees may be managerial executives if they have significant discretion to formulate and direct the implementation of management policy within a substantial department or functional area.
- The court largely accepted PERC’s general approach to identifying confidential employees but emphasized the statutory focus on functional incompatibility with unit membership, not mere proximity to labor-relations matters.
- The court modified and affirmed the Appellate Division’s judgment and remanded to PERC to reapply clarified standards to the disputed positions.

## Legal Principles

- PERC’s interpretations of the Act receive substantial deference, but courts will reject constructions inconsistent with statutory language or legislative intent.
- “Managerial executives” (N.J.S.A. 34:13A-3(f)) are employees who both (1) formulate management policies/practices and (2) are charged with directing their effectuation; this status can exist at the departmental level and does not require organization-wide policy authority.
- “Confidential employees” (N.J.S.A. 34:13A-3(g)) are excluded when an employee’s functional responsibilities or knowledge connected to collective negotiations would make membership in any appropriate unit incompatible with official duties.
- Confidential status turns on actual job functions and a fact-specific inquiry into whether the employee participates in, assists with, or has access to management’s bargaining strategies, proposals, grievance handling, or contract administration positions in a way that creates a real conflict.

## Conclusion

The court clarified that managerial-executive exclusion may apply to employees with substantial policy-formulating and policy-effectuating authority within major organizational subdivisions, and it required a function-based, incompatibility-focused analysis for confidential employees; it remanded to PERC to reassess the challenged positions under these clarified statutory standards.


N.J. Tpk. Auth. v. Am. Fed’n of State, Cnty. & Mun. Emps., Council 73, 150 N.J. 331, 696 A.2d 585 (N.J. 1997)