NTEU Offers Strong Support For Repeal Or Modification Of Unfair Retirement Laws

Press Release September 24, 2003

Washington, D.C.—The leader of the nation’s largest independent union of federal employees again today pressed Congress to approve bipartisan legislation that would reform or repeal two provisions of law that have a significant adverse impact on the retirement incomes of federal workers.

President Colleen M. Kelley of the National Treasury Employees Union (NTEU) urged approval of pending legislation that would eliminate or at least mitigate the worst effects of the Government Pension Offset (GPO) and Windfall Elimination Provision (WEP).

In testimony submitted to the Senate Governmental Affairs Committee, President Kelley said the GPO and WEP “have negatively affected NTEU members’ retirement plans for many years” and called action by Congress to address those impacts “long overdue.”

The GPO unfairly penalizes recipients of government pensions who are also eligible for Social Security payments on a spouse’s work record. It reduces the spousal Social Security benefit by two-thirds of the government pension. The impact in many cases is to eliminate entirely the Social Security benefit a federal retiree otherwise would receive.

President Kelley noted that the impact is “particularly devastating” on female federal retirees who for a variety of reasons often are eligible for smaller federal pensions than their male counterparts.

“More often than not,” she said, “the GPO disproportionately affects those who can least afford to forgo this retirement income.”

While functioning in a different manner, the WEP also penalizes individuals who have spent their careers in federal service. It can reduce a federal employee’s retirement income by cutting their own earned Social Security benefit by as much as 50 percent.

The WEP requires that a sharply lower Social Security benefit formula be used when a retiring federal employee is eligible for both Social Security and a pension from work not covered by Social Security—such as under the federal Civil Service Retirement System (CSRS).

President Kelley said NTEU “strongly supports” bipartisan legislation in both the House and Senate aimed at either repealing or substantially reforming both the GPO and WEP. H.R. 887, introduced by Rep. William Jefferson (D-AL), and S. 363, introduced by Sen. Barbara Mikulski (D-MD), would impose the GPO only in situations where the combined federal pension and Social Security payment exceed $2,000 month.

H.R. 594, introduced by Rep. Howard McKeon (R-CA), and S. 349, introduced by Sen. Dianne Feinstein (D-CA), would repeal both the GPO and the WEP. The Jefferson and Mikulski bills have attracted 125 and 28 cosponsors, respectively, while the McKeon and Feinstein bills have 261 and 23 cosponsors, respectively.

In her testimony, President Kelley said that “on behalf of all of our members, I hope that you will act on the bills referred to your committee without delay.”

As the largest independent federal union, NTEU represents over 150,000 employees in 29 agencies and departments.

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