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Karins v. City of Atlantic City2/18/1998
erved by law abiding and self respecting citizens, in or out of uniform; [contrary to A.C.F.D. Art. VII, §2-A(a)];
3. Conduct Unbecoming an Atlantic City Firefighter:
[A firefighter shall not] violate any law, or do anything for which they may be arrested; [contrary to A.C.F.D. Art. VII, §2-A(c)];
4. Conduct Unbecoming an Atlantic City Firefighter:
Repeated violation of the A.C.F.D. rules and regulations or any other course of conduct indicating that a member has little or no regard for his responsibility as a member of the A.C.F.D.; [contrary to A.C.F.D. Art. VII, §2-A(l)];
5. A.C.F.D. Operational Procedure # 105 - Policy Against Discrimination, Harassment and Hostile Environments in the Workplace:
It is against Department policy to engage in verbal or physical conduct or otherwise to engage in conduct directed at an individual employee or class of employees which any reasonable person would conclude:
* has the purpose or effect of creating an intimidating, hostile, or offensive working environment;
* has the purpose or effect of unreasonably interfering with an individual's work performance; or
* otherwise adversely affects an individual's employment.
The repeat offender charge against Karins was based on the fact that he had previously received a ten-day suspension for racial epithets directed toward a fellow firefighter. The prior incident occurred in September 1992 when Karins was disciplined for calling an African- American firefighter a "coon." For that incident, the Chief of the A.C.F.D. found Karins guilty of violating A.C.F.D. § 2-C(b): "Using profane or insulting language to a superior, subordinate or any other A.C.F.D. member."
Karins's conduct in that case contributed to the City's need to promulgate Operational Procedure #105, which was the basis of Karins's fifth charge in the present matter. Operational Procedure #105 was issued in May 1993, and Karins received a copy of the procedure in June 1993.
A disciplinary hearing was conducted by the Personnel Director for the City, and he found Karins guilty on all five charges. Karins was suspended without pay for 48 days. Karins requested and received a de novo review that was conducted before the Office of Administrative Law. The Administrative Law Judge who heard the case recommended that: (1) Karins's suspension be rescinded; (2) Karins's back pay, benefits and seniority for the period of suspension be reinstated; and (3) Karins be awarded reasonable attorney's fees and costs. Without addressing the constitutional issues, the ALJ concluded that the City was impermissibly attempting to discipline Karins for a violation of an unwritten speech code of which he did not have adequate notice. The ALJ concluded that the City failed to sustain its burden of proof on all the charges, and that Operational Procedure #105 applied solely to employees in the workplace during working hours.
The Merit System Board adopted the factual findings and legal conclusions of the ALJ. The Appellate Division affirmed in an [Editor's note: originally released as an unpublished opinion], holding that there was "nothing unreasonable, arbitrary, or capricious about the agency's decision." We granted certification, 147 N.J. 580 (1997), and now reverse.
II.
The City asserts that the Appellate Division erred because it did not resolve the constitutional issues presented by the City's application of N.J.A.C. 4A:2-2.3(a)(6) and the A.C.F.D. rules and operational procedures to Karins's racial slur. The City argues that the court should have applied the balancing test enunciated in P
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