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Bill would roll back pension contribution hikes

Aug. 1, 2014 - 06:00AM   |  
By ANDY MEDICI   |   Comments
Rep. Donna Edwards wants to roll back employee pension contribution increases.
Rep. Donna Edwards wants to roll back employee pension contribution increases. (Thomas Brown/Staff)

New federal employees would see their contribution to retirement funds drop by hundreds of dollars under legislation introduced July 31 by Rep. Donna Edwards, D-Md.

The Federal Employee Pension Fairness Act would reverse pension increases passed under the Bipartisan Budget Act of 2013, which requires federal employees hired after January 2014 to pay 4.4 percent of their salaries into the Federal Employees Retirement System. Those hired in 2013 pay 3.1 percent. Employees hired before 2013 contribute 0.8 percent.

The bill is co-sponsored by Reps. Gerry Connolly, D-Va., Elijah Cummings, D-Md., Marcy Kaptur, D-Ohio, Keith Ellison, D-Minn., Charlie Rangel, D-N.Y., and Delegate Eleanor Holmes Norton, D-D.C.

Federal employee groups have been pushing for the repeal of the pension contribution increases, arguing that it squeezes federal employees. For example, a chemical engineer hired at an Army installation in 2014 with a starting salary of approximately $36,000 per year will pay $1,300 more a year for his or her pension than someone in the same job and location hired in 2012 or before, according to the American Federation of Government Employees.

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“Congress has placed an immense burden on our public servants, with no regard to the harsh economic pain these modestly-paid, middle class Americans have suffered,” AFGE president J. David Cox said in a statement. “Rep. Edwards has been a staunch supporter of federal workers and understands that they should not be used as an ATM for those whose real goal is to dismantle the programs and agencies that employ this workforce.”

AFGE also sent a letter to members of Congress July 31 urging lawmakers support the legislation, arguing the increases were “draconian” and were only used to scapegoat federal employees for an economic crisis they did not create.

Federal employees have already contributed $120 billion toward deficit reduction efforts and the bill would help roll back the trend of cutting federal worker salaries and benefits, said Joseph Beaudoin, the president of the National Active and Retired Federal Employees association.

“Providing our public servants adequate compensation is about more than just fairness, it is about maintaining an efficient and effective federal government,” he said.

Federal employees have suffered enough through three years of pay freezes, unpaid furloughs, the elimination of cost-of-living increases and pension contribution rate hikes, Edwards said in a statement July 31.

“As a nation it is our duty to ensure the fair treatment of our federal employees, especially during times of economic strain. Let’s stop unduly burdening our federal workers, and start asking wealthy corporations to pay their fair share,” Edwards said.

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