HOBOKEN — Mayor Ravi Bhalla was censured by the New Jersey Supreme Court last week after a disciplinary board chided him for not setting aside over $6,000 for a former employee's retirement account between 2008 and 2009.

The June 13 action came six months after the board said the facts of the case "clearly and convincingly" establish that Bhalla acted unethically and violated three rules of professional conduct. The board voted 4-3 to recommend censure instead of a three-month suspension of Bhalla's law license.

The disciplinary board said that Bhalla's actions would have warranted a reprimand had he not been admonished in 2010 for record-keeping violations and for paying a client and himself from a check that had not cleared, actions deemed "improper," according to its 15-page December decision. The board found that a censure was due because of Bhalla's "nonchalance" regarding the employee's missing retirement contributions, the decision says.

"This matter amounts to an oversight by a small business owner that was immediately rectified once made aware of it," Bhalla told The Jersey Journal.

The timing is not optimal for Bhalla, who is the subject of a critical vote at Wednesday's Hoboken council meeting. The nine-member council, which has been hostile to the mayor, is scheduled to adopt an ordinance that would require Bhalla offer extensive and regular details about his part-time gig working for law firm Lavery, Selvaggi, Abromitis & Cohen.

The censure stems from a dispute involving the private practice Bhalla, a Democrat, ran before he joined the council in 2009. The details are spelled out in the disciplinary board's December decision.

Attorney Alexander Bentsen worked for Bhalla in 2008 and 2009. Bentsen, who made a $60,000 salary, asked Bhalla to withhold 10 percent of his gross income to be deposited in an IRA account at UBS Financial Services, with Bhalla matching Bentsen's contributions by up to 3 percent, the decision says.

But Bhalla did not make the required deposits, leaving Bentsen's IRA underfunded by $6,208 for the two years, according to the December decision. Bhalla also failed to remit Bentsen's 2008 Social Security withholding taxes, totaling $4,000, until 2013 or 2014, the decision says.

The mayor told the disciplinary board that he thought the payroll company he had hired took care of the funds intended for the employee's IRA account, according to the decision.

Bhalla did not take any steps to remedy Bentsen's financial situation until he was interviewed by the Office of Attorney Ethics seven years after the issue arose, the decision says.

Lawyers in New Jersey can be punished in five ways. The least serious action is admonition, followed by reprimand, censure, suspension and disbarment.

"Ravi Bhalla accepts, but respectfully disagrees with the ruling," said Bhalla spokesman Rob Horowitz. "This was an inadvertent payroll mistake, resulting in the underpayment of an employer match on an IRA retirement program more than 10 years ago when Mr. Bhalla operated his own small law firm. The employee never informed Mr. Bhalla and then waited seven years and filed an ethics complaint. As soon as Mr. Bhalla realized there was an underpayment, he immediately paid the amount due."

Bentsen made "numerous requests" to rectify the matter, according to the December decision.

Wednesday's council action involves a proposed rewrite of the city code that would require the mayor to submit quarterly reports on any outside employment listing all income and a list of all clients and or contracts. Brian J. Aloia, Hoboken's corporation counsel, recommended to the council in a six-page memo that it not adopt the ordinance, calling the change "invalid and unenforceable."

Bhalla's critics on the council — there are seven — have said they believe the mayor's part-time job with the Lavery firm raises potential conflict-of-interest issues.

Terrence T. McDonald may be reached at tmcdonald@jjournal.com. Follow him on Twitter @terrencemcd. Find The Jersey Journal on Facebook.