Reply to FERS pension contribution increase

Forum Index » Jobs and Careers

Reply to "FERS pension contribution increase "

Subject:

Emoticons





More smilies

Text Color: Font: Close Marks

[quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous]This will get challenged if it passes. Your pay can't get decreased, and this is a decrease in pay because you're required to participate in the retirement system (as compared to benefits like health insurance, which are optional). [/quote]

Why do you say your pay can’t decrease?

If you work for company A earning 100k and they tell you stating tomorrow, you will earn 95.6K, that is completely legal (absent a contract or something else specific).

You can either choose to work for 95.6k going forward, or you can quit.

Is there something specific about government employment that prohibits this?[/quote]

DP. There are different rules about pension vs salary. It's the same in public and private sector, so not something that special with government employment. Salary is an agreement going forward to provide labor at a specific rate. Either side can walk away. As PP mentions, pensions are deferred compensation for past work. Companies aren't allowed to just zero out previously promised pension obligations. Otherwise it would be the first cost cut that every corporate raider would do upon acquisition. [/quote]

But they wouldn’t be doing that.  They are simply saying that, going forward, you will have to pay 4.4% of your current and future salary.  Not only isn’t the government’s pension obligation not zeroed out, it isn’t changed at all.  You would get the same pension as you would previously.[/quote]

There are several things being proposed 
1) for changing the withholding from 0.8 or 3.3 to 4.4, I agree with you. That’s about the future and both sides can assess whether it’s a deal to accept 
2) changing high3 to high5 potentially changes the value of both previously earned pension components and future ones. I feel the future is fair game if they can do it politically but the previous ones were deferred comp. If they used high3 for anything before the point it changed and high5 after it would be different. And are they planning to retroactively change it for everyone who’s already drawing retirement?
3) same with the SS supplement. Are they going to take it away from retirees already drawing? It’s already scaled based on years of govt service so it wouldn’t be hard for them to freeze it and not allow new years to be added so that it phased out over time

These are the type of steps corporations take when they shut down future pension programs. Sometimes they also buy out the employees with a lump sum[/quote]

Fair enough.  The change to high five if not adjusted would arguably be a retroactive change.  I was only talking about the potential prospective change to 4.4.[/quote]

Options

	Disable HTML in this message
	Disable BB Code in this message
	Disable smilies in this message

Review message

Search Recent Topics Hottest Topics