4 days Ago By Pat Devaney
All across Illinois, public employees wake up every morning to deliver vital services to residents in every corner of our state. These are teachers, nurses, firefighters, police officers and more who dedicate their lives to serving our communities, often doing dangerous or demanding jobs that many take for granted. However, changes to state law have severely cut the retirement benefits these workers depend on, forcing most of them to work until age 67 to receive a diminished retirement that does not keep up with inflation.
Recently, the We Are One Illinois coalition of public employee unions announced a new effort to fix this broken system, which would ensure our public workers can retire with dignity and help us recruit the next generation of workers we all depend on every day in our communities. Public employees did not create the state’s well-documented pension or financial problems — politicians did. Workers have always paid what has been required of them into Illinois’ public pension systems, even as the state’s financial problems grew.
To address these problems, politicians forced the people who serve our communities onto an unfair, lower tier of retirement benefit — called “Tier 2” — for no reason except they were hired since 2011. More than a decade later, most public workers are now on Tier 2 — and it falls woefully short of providing a stable retirement. Their pension is less, it doesn’t keep up with rapid inflation for things such as food and medicine, and they have to wait until age 67 to collect it.
Plus, many public employees don’t have Social Security, so if they can’t get by on the second-tier pension, they have no backup. That’s unfair. Public workers on Tier 2 do the same job as those with the higher Tier 1 benefits and pay the same amount toward their pension, but get less.
Many Tier 2 participants actually pay more into the system than their pension is worth! Plus, Tier 2’s fewer benefits make it hard for school districts and state and local governments to hire and keep the teachers, first responders, nurses and other public employees they need. That creates staff shortages that result in larger class sizes, slower emergency response, longer waits for services and diminished quality of care for people who need it. The solution is the Fair Retirement and Recruitment Act, introduced in the Illinois General Assembly .
This legislation would bring the final average salary pension calculation back in line with Tier 1, align Tier 2’s retirement age requirements with Tier 1, implement an across-the-board 3% simple interest cost-of-living adjustment for all Tier 2 members and adjust the pension salary cap to comply with federal Social Security requirements. We understand that fully returning back to Tier 1 for all employees is not currently economically feasible, but the changes proposed by the We Are One Illinois coalition are commonsense reforms that would address the major issues driving workers to leave the public sector. Some have suggested the solution lies with simply fixing the Social Security “safe harbor” requirements within Tier 2, which are widely agreed to be out of compliance with federal law.
But only fixing the safe harbor issue would affect a sliver of the highest-earning workers and does nothing to address the core problems with Tier 2. That is unacceptable. Now that the legislation has been introduced, public employee unions are ready to work with lawmakers and others to understand its financial impact for the next several decades, and we stand ready to identify cost savings, efficiencies and revenues to ensure these changes are made in a fiscally responsible manner.
But make no mistake: Every day, we wait to address these problems, the more expensive it becomes to fix this broken system. Fixing Tier 2 may come with a cost, but what is the cost of classrooms without teachers, or communities without adequate fire protection, or hospitals without nurses? Passing the Fair Retirement and Recruitment Act and finally fixing Tier 2 mean investing in a stronger state with better services for all. Let’s work together to fix the broken Tier 2 pension system and ensure Illinoisans continue to receive the high-quality public services we all depend on.
When firefighters, nurses and teachers work hard their whole careers, we should keep up our end of the deal and make sure they can retire and afford to pay their bills. This legislation is a major step in the right direction, and we look forward to making it a reality in the weeks to come. Pat Devaney is secretary-treasurer of the Illinois AFL-CIO, a member of the We Are One Illinois coalition.
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