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Retirement security of public employees under attack again

11/14/13

An anti-worker politician continues his effort to break the promises to employees on their retirement by introducing an initiative that would allow unilateral cuts to retirement savings.

The initiative submitted in November is posing a threat to the retirement security of millions as it would allow government agencies to cut the retirement benefits that have been promised to their workers. It was submitted by San Jose Mayor Chuck Reed and may qualify for the November 2014 ballot.

The goal of the initiative is to change the rights guaranteed by the federal and state constitution that employees must receive the retirement benefits that were promised to them when they were hired. Although the wheels are already starting to fall off the wagon of Reed’s plan, it’s still a serious threat to retirement security. Reed pulled his original version of the ballot measure and submitted a new version with what he calls “substantive changes.”

“Even though Reed made cosmetic changes to it, the measure’s weaknesses—breaking the promise of retirement security to current public employees, increased short-term costs to state and local governments, and legal issues—remain the same,” CSEA Executive Director Dave Low said.

CSEA members know that retirement benefits are necessary, not exorbitant. The average classified employee pension is around $1,675 a month and retirees rely on their pension benefits to cover basic costs of living, including food and rent.

A study released earlier this month noted that 42 percent of Americans say that saving money for retirement and paying their bills is not possible. More than a third said that they will never be able to afford to retire and will have to continue working until they are sick or die.

Furthermore, 6 million Californians don’t have a retirement plan at all and millions more face the threat of retiring into poverty. This measure would pull the rug out from under some of the middle class workers with a retirement plan they earned and on which they can rely.

Retirement benefits also affect local communities. Each dollar paid in state and local benefits to California residents supports $1.75 in total output in the state. CalPERS is a major economic force to create jobs in the state.

The courts have upheld that public employees have a vested right to the level of benefits they were promised when they were first employed, so the anti-public-employee politicians pushing this initiative—with the help of a Texas-based, former Enron trader billionaire—want to delete this constitutionally-protected right.

Any changes to pension benefits should be determined through negotiations in the collective bargaining process between the employees and employer, not through the ballot box.

CSEA members rally to defend retirement security