NTEU Supports Edwards Bill to Roll Back Pension Contribution Hikes from New Hires

Press Release August 1, 2014

Washington, D.C.—The leader of the nation’s largest independent union of federal employees today offered the union’s strong support for proposed legislation which would eliminate increased pension contributions imposed on new federal hires in 2012 and 2013.

President Colleen M. Kelley of the National Treasury Employees Union (NTEU) offered that support in a letter to Rep. Donna Edwards (D-Md.), who introduced the bill. The measure would return new employee contributions under the Federal Employees Retirement System (FERS) “to a reasonable percentage,” Kelley wrote.

FERS contributions from new hires were boosted in 2012 to help pay for an extension of unemployment insurance, and again in 2013 to help offset spending in a budget agreement. FERS covers the bulk of the federal workforce, and often is held out as a model pension program, among other reasons for the fact that it has no unfunded liabilities.

In her letter, President Kelley noted pointedly that while pension contributions were raised for new hires two years running, there were no corresponding increases in benefits, thus making the higher pension deductions from their paychecks “little more than a selective tax on federal employees.”

The NTEU leader emphasized that the federal workforce continues to bear a disproportionate burden of deficit reduction, having contributed $138 billion as a result of a lengthy pay freeze and higher pension contributions. This is more than any other group in the nation has been asked to sacrifice.

Still, Kelley said, federal employees continue striving to help their agencies perform their missions on behalf of the public. “Serving America has been and will continue to be job number one for federal employees, despite the pay freezes, the [government] shutdown, the furloughs and the increased pension contributions,” she wrote to the congresswoman.

Large segments of the federal government were shut down for 16 days last October in a congressional budget dispute.

In her message to Rep. Edwards, President Kelley added: “Thank you for recognizing the importance of federal employees.” The congresswoman, who is in her fourth term, represents thousands of federal workers.

As the largest independent federal union, NTEU represents 150,000 employees in 31 agencies and departments.

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