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Pension battle now in hands of high court

by John Kennedy | September 7th, 2012

The battle over 3 percent payroll contributions demanded of public employees by Gov. Rick Scott and the Florida Legislature in 2011 went Friday before the state Supreme Court, with a lawyer for workers saying it violates an almost 40-year pension fund guarantee.

About $2 billion is at stake — cash lawmakers expected to draw from the payments. It was used to plug holes in last year’s budget and this year’s spending plan, which took effect July 1.

 Lawmakers also could be forced to repay $786 million already collected from employees of  the state, school boards, counties, colleges, universities and special districts if justices agree with a lower court that found the payments unconstitutional.

Ron Meyer, attorney for the Florida Education Association, the state’s largest teachers’ union, said much of the dispute turns on timing. The lower court found the move violated the constitution because it applied to all 623,000 employees in the Florida Retirement System. 

If lawmayers had sought the payments only from workers hired after the law took effect July 1 last year, they may have been on solid legal ground, Meyer conceded.

“You just can’t go back and change the deal midway,” Meyer said following arguments before the seven-member court.

Scott and lawmakers, however, say a 1981 court ruling involving the Florida Sheriffs Association, held that the Legislature could reduce the amount of benefits that would go to FRS members. Former Supreme Court Justice Raoul Cantero argued for the state before his former colleagues.

Scott called the change “common-sense public pension reform.”

“The legal question in the case is straightforward,” Scott said. “The Legislature relied on and carefully followed a thirty-year-old Florida Supreme Court case, which held that the Legislature can change the public pension system on a going-forward basis.  We therefore expect the Supreme Court to follow its own prior decision.”

 

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14 Responses to “Pension battle now in hands of high court”

  1. Toni Says:

    Republican Governor Rick Scott believes in breaking any promise that doesn’t involve a millionaire or a corporation. So he takes from the low paid state and county employees so that he can give millionaires and corporations a tax break. Keep voting Republican and you will get more of the same.

  2. Stop squeezing the average taxpayer Says:

    If the judge rules in favor of the unions then your taxes will be higher and other cuts will have to take place.

    These greedy groups need to start funding their own pensions and benefits and stop demanding that other taxpayers be able to keep MORE MONEY IN THEIR POCKETS RATHER THAN GIVE MONEY TO THESE WORKERS WHO SHOULD BE PAYING THEIR OWN WAY!

    Stop squeezing taxpayers. WE all have to pay for your pensions, benefits. It’s time for YOU to contribute MORE!

  3. luckydog Says:

    Most stable govt pension funds require employee contributions, those that are bankrupt do not.

  4. Serge Says:

    The way that they phrase this is not accurate. It makes it sound like 3% is being taken out of people’s paycheck and put in an account for them somewhere. That is not the case. It is simply a 3% pay cut (or tax) on employees. That 3% is then put in the general fund to pay for everything. This 3% was then used to give tax breaks to the wealthy who own two homes and to cut taxes on the wealthiest corporations that contributed to the legislators campaigns. Does this sound fair? Also, do not compare upper management big-wigs who make 100K per year with the rank and file employees who drive buses, clean parks, and do other menial jobs for a small amount of pay. The majority of those people took low paying jobs because of health insurance and a decent retirement. Note that I said decent – not good.

  5. El Mexicano Says:

    In Mexico this would not be a problem. Why? Not because of socialism, but because there are no pensions.

    Thank you.

  6. Downtown Danny Says:

    Steal from the poor – give to the rich – that’s the Republican way – immoral, illegal, uncaring and Nazi all the way.

  7. carol Says:

    Breaking a contract is wrong. Taking three percent for a pension plan and putting that $ in a general fund is stealing. Who else pays into a retirement plan and thinks it is ok if investors spend it elsewhere? Does anyone else see that there will be no fund to draw on in the future?

  8. whasup Says:

    I think the cure the union lawyers are seeking will be worse than the disease.
    If the Court disallows the mandated contribution (“tax” on pay as the union blowhards call it), then the Legislature can simple resolve the issue of money by cutting all workers pay. That will let them fix the budget hole and also probably reduce the future pension benefits for all employees compared to what they might have become otherwise.

    Look folks, the mandated contribution is not a tax on workers’ salaries. Instead, it is a margin call on government employees whose pension-invested funds are insufficient to actually fund their future benefits.

    What the government workers and their union bosses want is for us taxpayers, who have to fund our own pensions, to also pay for theirs. Just how greedy are these folks who we taxpayers employ?

    Oh, by the way, the real reason the union bosses don’t like the contribution is that it makes it harder for the bosses to collect more in dues from their members … so the bosses can live their well-paid lifestyles. That is what this is really about, not the little worker bees.

  9. carol Says:

    The retirement fund is flush, the 3% is nothing more than an income tax for Florida state employees! The retirement benefit takes into consideration the take home pay of state employees vs. corporate pay in similar jobs. For those who think state employees rake in the cash and benefits, pull up the state salaries to find out who is really getting hurt.

  10. Bill Says:

    The reason the states and cities are in the problem they are in is because they chose not to pay into the system the way they were requuired to do in the years the economy was doing good, now that the economy is in bad shape, they claim it is the unions fault, when in reality it is there poor planning and bad habit of moving money around from one place to another to suit there needs.

  11. Ryan Says:

    mandatory 3% that is taken out of my paycheck for pension and then put into a general fund is just wrong. First, we get paid on average 30% less then private employees. Second, we have not received raises in over 5 years, and no we do not get bonuses. Third, I pay 600$ a month out of my pocket for my insurance. Which is a large amount of my paycheck. With a reduced level of benefits and an increased cost, I have lost over 8% of my pay. All I ask is to, at the very least, make the 3% nonmandatory, so i can opt out. That’s my 2 cents.

  12. Sue Says:

    Thank you Ryan. I am so sick and tired of the morons who have no idea what this whole pension matter is about making comments that show how stupid they are. As a County/State employee, we were offered certain incentives IN LIEU OF A SALARY that would compare with the private sector. We have not had a raise in 5 years, we do not get a bonus like the private sector and we have had to pay higher amounts for health insurance while Scott and his Repub/Tea Pary Losers keep attaching themselves to our wallets. Any County/State employee who votes Repub/Tea Party in the upcoming election should just remember the screwing we are getting by these losers on a State level…Do you really want them in office as President/Vice President? Wake up before it’s too late.

  13. Fed Up Says:

    @Ryan and Sue, lets not forget the small amount the legislature and gov pay for health insurance. Also lets not forget how they exempted themselves from mandatory drug testing.

  14. hotel Says:

    Good Blog. I will continue reading it in the future. Nice layout too.

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