Retirement Health Benefits Threatened for Public Employees

By Amy Todd, Assistant Editor, Union News, Anthropology

FALL 13

We tend to think of Massachusetts as a union-friendly state.  However, the introduction of House Bill 59, An Act Providing Retiree Healthcare Benefits Reform, is a sober reminder that we are not immune to legislative attacks on public sector workers. 

On October 31st, members of our campus unions, along with a diverse cross-section of public sector workers, packed the Gardner Auditorium of the State House to voice their opposition to the bill.  Peggy Walsh (Senior Lecturer, English) observed that members of the Public Service Committee “listened and were moved, ethically, intellectually, and emotionally, by the anti-bill testimony.  They did not adjourn until they had heard every single person who wanted to speak.”

The bill proposes alarming changes to retiree health care benefits for state and municipal workers.  It seeks to increase the minimum years of creditable service required to receive health benefits in retirement from 10 to 20 years. The proposed legislation also significantly increases the premiums paid by retirees with less than 30 years creditable service.

Proponents of the bill, including MTA leadership, accept the claim that the healthcare system for public sector workers is not “sustainable” and that the solution is to cut benefits promised to retirees. 

However, many unions, locals of the MTA, and union members argue that the crisis has been “manufactured.” In the analysis of UMass Boston¹s Professional Staff Union, three factors are responsible for the crisis: rising health care costs due to the absence of a single payer system, regressive tax cuts over the past 20 years, and attacks on pensions, including “questionable accounting rules” supported by the corporate-backed American Legislative Exchange Council, which seeks to defund public institutions.

Many of the state and municipal workers, as well as legislators, who testified against the bill noted that downgrading retiree healthcare benefits would represent a moral failing on the part of the state and municipalities.  Workers are recruited into the public sector not for the pay but for the promise of security in retirement.  Current retirees and certain employees nearing retirement age would be exempted from the proposed changes.  It became clear during the hearing, however, that even grandfathering all existing employees would not erase this moral failing or deal with practical considerations of running the public sector.

While a document posted on the MTA website observes that under the current system “A person can work for the state or a municipality from, say, 25 years old to 35 years old, spend most of his or her career in the private sector, and come back at what would be his/her retirement eligibility date and collect full retiree health benefits,” there is no evidence that is a common work history. Rather, based on the many testimonies from public sector workers at the State House, a far more typical scenario is choosing to enter the less-lucrative public sector, often later in life, with the intention of working through, and even beyond, retirement age.

Workers enter the public sector later in life for very good reasons, as many testified. Women often delay entry into the workforce to care for children.  Workers may spend years in the private sector garnering valuable experience, which they later bring to the public sector.  Workers may also need to acquire formal training prior to employment, as is the case for most higher education faculty.  According to the National Science Foundation, in 2011, the average time between completion of a bachelor’s degree and doctorate was 9.1 years.  In fact, as Jeff Keisler (Professor, Management Science and Information Systems) noted in the Spring 2013 Union News, recruiting and retaining high quality workers will be compromised by passage of the bill, since public sector workers are paid less than their private sector counterparts.

House Bill 59 is particularly harmful to part-time employees, from cafeteria workers to crossing guards to adjunct faculty.  As Bob Rosenfeld (Senior Lecturer, Philosophy) noted in his testimony: 

I am currently in my 30th year of teaching at UMass Boston.   If I get credit for all the time I should, I will have achieved 17 years of creditable service by June 2014, a figure that has fortunately been augmented by my having taught at ¾ time (instead of just half time) for about a decade.  Nevertheless, I would not qualify under the proposed new requirements.  If I continue to teach at ¾ time for the next four years, I will reach the 20-year mark in June 2018 – a full year after I become eligible for Medicare.  To reach the 30-year mark, at ¾ time, would require an additional 13-1/3 years beyond that.

At UMass Boston, lecturers who have taught full-time for many years are never guaranteed a full course load.  At any point, any lecturer may have a class canceled because it does not meet the minimum enrollment requirement set by administration.  Lecturers’ workload may also be reduced when tenure stream faculty are hired.  All this adds to lecturers’ retirement insecurity.

Outside the Gardner Auditorium, a lively conversation erupted among a group of retired teachers who could not understand how the MTA leadership could support a bill that so negatively affected its members. Educators for a Democratic Union, a progressive caucus of the MTA, wondered the same thing, and submitted a New Business Item at the 2013 delegates meeting calling on the MTA to formally oppose the bill.  In response, the initial enthusiasm among MTA leadership for the bill has subsided to some degree.  They now recognize some of the problems raised above, and are pressing for the bill to be modified. 

Nevertheless, there remains a fundamental disagreement about the role of the MTA (and unions generally) in shaping the conversation about retiree health care benefits and other high-profile issues.  MTA members who defended the bill at the 2013 delegates meeting expressed fear that if it does not pass, cuts to retiree benefits might be even more draconian.  One could imagine, for example, legislation to end retiree healthcare benefits altogether.  Other delegates, however, including members of EDU, questioned the strategy of agreeing to cuts in the hopes that those who seek to erode the public sector will simply go away, happy with the compromise. 

It is not too late to get involved in this fight.  All the campus unions are urging members to send their testimonies to the Chairs of the Public Service Committee.  William Brownsberger, Senate Chair, can be reached at William.Brownsberger@masenate.gov.   Aaron M. Michlewitz (House Chair) can be reached at Aaron.M.Michlewitz@mahouse.gov.  You should also contact your state senator and representative.

Regardless of the outcome of House Bill 59, there is no reason to think attacks on the public sector will not come back in one guise or another.  House Bill 59 is a reminder that we must be alert and prepared to respond to such attacks. The response, which brought together public sector unions from Corrections United to the Massachusetts Organization of State Engineers and Scientists to locals of the MTA, is a reminder that there is strength in solidarity. ▪

Amy Todd is Vice President of the FSU. Contact her at: atoddfsu@gmail.com