Professionals’ pensions at issue with new law


EAST BRUNSWICK — There will be a new mayor in East Brunswick next year, and apparently a new way of dealing with professionals hired by the township.

The Township Council recently adopted an ordinance that allows the town to classify certain vendors or people working for the municipality as “outside professionals,” Councilman David Stahl said. The official classification would be independent contractor and would mean the person is not eligible to collect a pension for his or her work in East Brunswick.

Stahl said the ordinance is a way to save taxpayers money because the township must pay into the state pension fund based on the number of East Brunswick workers included in the plan.

The problem of professionals such as judges, lawyers and prosecutors collecting jobs to bolster their pensions has been a hot topic around the state. Stahl said he thinks professionals should collect pensions through the firms they work for, not the towns they serve.

“One of the good things now is, with outside professionals you have the ability to hire them as independent contractors and not as employees, so you can reduce the number of people eligible for the pension plan,” Stahl said. The state recently enactedwhat is called the Defined Contribution Retirement Program, which to some extent leaves it up to municipalities to determine what positions are eligible for the program.

While the East Brunswick ordinance states that numerous positions will take part in the pension program — among those listed are business administrator, department heads and township attorney — Stahl said the decision as to whether other professionals are employees or independent contractors will be made using IRS employee/contractor criteria.

“As long as that employee relationship does not exist, you do not have to put them in the defined pension program,” he said.

Stahl said the determination as to who is considered an independent contractor would be made by the next administration. He said certain positions, such as tax assessor and chief financial officer, would likely remain classified as employees, and thus in the program, whereas others, such as lawyers, could be cast out.