Re: federal benefit cuts

Don't current federal employees have an implicit contract in their current benefits? Would is be legal to cut the current benefits for current employees? Wouldn't any change HAVE to be ONLY for future employees and all current employees "grandfathered" into the present system? Anyone have any thoughts on this legal issue? Thanks.

Re: federal benefit cuts

As the article says, Congress gives the benefits and Congress can take them away. There are proposals floating around to increase taxes and reduce social security benefits--it is the same concept as many taxpayers paid in the max to social security and they may find that there benefits are reduced in one or more ways. We are not any different as feds. The primary advantage we have: Congress is under the same retirement system. Any bets as to whether congress will vote to cut their own benefits?

Re: federal benefit cuts

So, in theory, Congress could cut all current federal benefits when we retire by--say--75% and we would be helpless? No Court could intervene on any grounds? Zero legal protection to programs like our basic annuity retirment plan that we pay into and have expectations to receive? Really?

Re: federal benefit cuts

I recently settled a lawsuit, on the advise of a lawyer, based on the fact that a simple e-mail constituted a legal, binding contract. So, after 35 years of being handed written documentation spelling out my retirement benefits, my guess is that we DO have a contract. And, with a few million retirees, and near retirees, all willing to pony up $10.00 or so, it would be pretty easy to generate a multi-million dollar legal fund to make sure the contract is enforced.

Re: Longer service for health insurance premiums

I think the article made it clear that these were just proposals being considered out of a large number of possibilities outlined by the CBO. I went back and read it again after seeing your comment and it seemed even more clear that the items outlined are just ideas being thrown around by the CBO? did you interpret the article to be saying something different?

Re: Longer service for health insurance premiums

Nope, we read it the same way. That's why I started off saying a proposal is just that. I'm just saying that I agree with some of the ideas being proposed.

Re: Longer service for health insurance premiums

Be careful of what you wish for Mr. Worker Bee. Accepting a high-five computation before receiving pay comparability would be foolhardy. After all, where is the Pay comparability Act of 1994. Although it became law, it has NEVER been used in our pay raise computations, so speak for yourself and yourself only if you are willing to give into the high 5 cause I am not. Give me comparability first then I will consider it

Re: Longer service for health insurance premiums

Requiring employees to have a minimum of 10 years of service before being entitled to a 72% Government contribution for health insurance seems to be a fair proposal, assuming that those already in Federal service are grandfathered. However, I take issue with Worker Bee’s statement that moving to a high-5 calculation “is fair if that levels the playing field” with the private sector.

Worker Bee must be under FERS, because CSRS retirees would be the ones to take the biggest hit. Using a high-5 method to calculate retirement would reduce the average CSRS pension by $6,530 over a five year period, but the FERS retiree would be out only $2,190 – that’s approximately one third. Nonetheless, if we must go to the high-5 calculation, let's level the playing field with FERS as well by paying retroactive matching TSP contributions to CSRS employees. Of course, allowances would have to be made for the long running bull market to ensure CSRS retirees receive their proper due.

Re: Longer service for health insurance premiums

I also agree that it would be fair to change the formula for new employees for health care. But, eventhough I switched to FERS, I don't agree that it would be fair to employees (CSRS or FERS) who were told when they were brought on that pensions were based on high three to be switched to high five. No way! Maybe new employees because they are being told beforehand but not fair to existing employees.

Re: Messing With Retirement Benefits

If Congress intends to implement any of these "proposals." they should apply only to new Federal employees and current employees should be "grandfathered". Although the courts dispute that there is an implicit contract between an employer and employee with respect to pensions and benefits, in fact, there is. In addition, I would hope that Congress would be subject to such changes. Although they are only proposals, they reflect much about how Federal employees and military personnel are currently viewed by both parties. The closer I get to retirement, the more grateful I become. Many Americans are working longer hours for lesser or no pensions and markedly decreased benefits and real wages, when measured against inflation, have been on the decline for thirty years. Whether it is Federal employees of the middle and working classes who are asked to bear the bulk of the burden, it is inherently unfair and ijeopardizes the existance of a solid middle class.

Re: Messing With Retirement Benefits

Pertaining to many of the comments regarding whether any of these "proposals" would apply to all Feds, or only those hired after a certain date, etc. and whether Congress can legally cut our benefits or if there's an "implied" contract, remember this: 1) We've read many articles that 40% of the Federal Workforce will reach retirement age in the next 4-5 years (but not all will retire), and that Congress is worried about whether the Federal Govt is going to be able to recruit and retain good employees (compete with the private sector). Replacing the High 3 with 5 and some of these other proposals would be a good way to accelrate the retirement rate, and I'm sure Congress is not interested in doing that. 2) Remember that AFTER a Fed retires they become a member of the large block of ACTIVE voters, and if Congress gives long time Feds the "shaft" at the end of their career, those Fed retirees may return the favor to their elected officials by putting them out of a job the next election!!