Pension padding in plain sight

by Lise Bang-Jensen |  | NY Torch

Discovering that government employees work extra overtime to spike their pensions is akin to learning there’s gambling in Casablanca.

So the report, “Pension Padding: We All Pay the Price,” should come as no surprise to public employees, their bosses or casual newspaper readers. What is noteworthy is it was issued by Andrew Cuomo, state attorney general and Democratic gubernatorial candidate.

The preliminary report, released Wednesday, spotlights the practice of employees working substantial overtime immediately before retirement, thus increasing their lifetime pensions. Current pension laws and union contracts offer employees legal incentives to do so.

What does Cuomo think should be done about it? The report, after offering some ideas for better management practices, concludes:

Although there have been recent legislative efforts to address some of these issues, ultimately further legislative reform must be considered to effectively curb pension padding practices.

We’ll have to wait for the next report to learn if Cuomo supports eliminating overtime in pension calculations–a change that could affect only future employees. Or whether he supports–either through collective bargaining or even legislation–ending contract rules that award overtime on the basis of seniority.

Perhaps a future report also will look into claims of Mayor Robert Duffy that Rochester firefighters may be selling overtime to spike each other’s pensions. Duffy, who asked Cuomo to investigate in April, is running for lieutenant governor on Cuomo’s ticket.

For news stories about “Pension Padding,” see hereherehere and here.


Originally Published: NY Public Payroll Watch, July 8, 2010