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Rhode Island Public Workers Win Key Pension Ruling

by Clyde Weiss  |  September 15, 2011

Rhode Island public service employees worked diligently for years while counting on the state to live up to its promise to provide them with a secure retirement. When the state reneged, they sued through their unions. This week, they won an important victory in the legal battle with the state.

Ruling that pension benefits “are not gratuities that may be taken away at the whim of the state,” Rhode Island Superior Court Judge Sarah Taft-Carter refused to grant the state’s request for a “summary judgment” to drop the suit, brought by AFSCME Council 94 and other unions representing state workers and teachers.

“Council 94 and other state employee/teacher unions have argued all along that pensions are not simply gratuities,” says Council 94 Pres. J. Michael Downey. “We have to work long and hard to earn a pension. The state should not simply be able to take away or make changes to our pensions whenever they want.”

The unions filed suit last year, challenging cuts the state made to the public pension system in 2008. The suit was later amended to include pension changes the Legislature made last year that further hurt workers’ promised retirement benefits, including reducing the size of a pension, increasing the length of time before a worker could qualify for retirement, and limiting cost-of-living adjustments.

In her ruling, Judge Taft-Carter wrote that “the major purposes underlying public pensions are to induce people to enter public employment and continue faithful and diligent employment and to furnish public employees with employment stability and financial security.”

The state says it plans to appeal the ruling, but public employees should have their day in court to make their case that the state cannot simply break its promises and alter their pension benefits without negotiating with their unions first. Says Downey: “Council 94 recognizes that this decision, while important, does not represent a full victory. Judge Taft-Carter’s decision that an implied contract exists will ideally allow for a full hearing on the merits of our case. Council 94 looks forward to our day in court.”

Despite the ruling, the Legislature is still planning a special session this fall to consider even further pension changes, such as having part of their guaranteed pensions replaced with 401(k)-style savings accounts, and a reduction in cost-of-living increases. With serious legal issues still unsettled, AFSCME believes the Legislature should wait until the court case is resolved before considering further pension changes. Otherwise, further legal challenges are possible, which will waste scarce taxpayer dollars.

Read more about this story in The Providence Journal and WPRI.com.

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