Legislation & Politics

AFSCME's Position – Social Security Government Pension Offset/Windfall Elimination Provision

Background

Public employees eligible for a pension for work not covered by Social Security but who also have worked and earned Social Security benefits in private sector jobs may have their Social Security benefits drastically reduced when they retire as a result of the Windfall Elimination Provision (WEP). The WEP was created in 1983 by Congress to distinguish between two types of retirees - those who receive pensions from primary jobs in non-covered employment, but whose low-wages or short work records from secondary jobs make them appear to have had low-wage careers; and others who actually spent their entire careers in low-wage jobs. Congress believed that those with secondary jobs were getting an unfair advantage from a Social Security benefit formula designed to give low-wage workers a decent income upon retirement. The Social Security Administration, however, does not consider what a public employee has earned when applying the formula. As a result, some workers pay the same percentage in payroll contribution on their Social Security-covered earnings as all others, yet they are being unfairly penalized by this provision.

An equally economically devastating situation is thrust upon public employees who are eligible to receive spousal Social Security benefits as a result of the application of the Government Pension Offset (GPO). The GPO applies to nearly everyone receiving a public pension from work not covered by Social Security, which is approximately 25 percent of the public workforce. If the public pensioner is also eligible for a Social Security spousal or widow's benefit, this law requires that the benefit be offset by an amount equal to two-thirds of the public pension. Retirees cannot receive a Social Security benefit based on their own work record and a full spouse/widow benefit. Private sector workers who receive a private pension have no such offset. These retirees can receive a full pension and a full spousal benefit under Social Security.

Summary of legislation

AFSCME strongly supports legislation to repeal or reform both the WEP and the GPO.  Senators Feinstein (D-CA) and Collins (R-ME) reintroduced the Social Security Fairness Act (S. 206) in the 110th Congress that would repeal these unfair statutory provisions. The following Senators were original cosponsors:

Lisa Murkowski (R-AK) Diane Feinstein (D-CA), Bill Nelson (D-FL), Daniel Akaka (D-HI), Susan Collins (R-ME), Olympia Snowe (R-ME) Frank Lautenberg (D-NJ), Patrick Leahy (D-VT), Maria Cantwell (D-WA).

Representatives Howard Berman (D-CA) and Howard "Buck" McKeon (R-CA) introduced a similar repeal bill (H.R. 82) in the House on the first day of the new Congress with over 100 cosponsors.

What you can do

Call your Senators and Representative and tell them that you strongly support correction of the inequities imposed on Social Security beneficiaries by the GPO and the WEP.

Department of Legislation
February 2007

Print Version
 

Raymond Summers
Council 31, Illinois

Raymond Summers

"I'm not a Democrat or a Republican, but I am a proud city employee. I support candidates who are on our side. And after they win, I make sure they vote for legislation that supports public services."