Unions to keep fighting set aside of pension funds
By BRENT KALLESTAD
The Associated Press
Despite an unfavorable judicial ruling on their first stop, union leaders representing teachers and other public employees say they have just begun their fight against a new Florida law taking effect Friday that requires workers to contribute 3 percent of their pay to retirement.
On Thursday, Circuit Judge Jackie Fulford rejected the union’s request to set aside those contributions into a separate account until the courts have a final say.
She wrote that she had to assume that if the law is eventually struck down the state would comply with a court order to return the contributions, although there is no statutory mechanism for such a refund.
“This hearing is only the first battle in what will be a long legal war against this anti-worker legislation,” said Alphonso Mayfield, president of the 19,000-member SEIU Florida Public Service Union. “Our focus remains on trying to overturn this unconstitutional income tax on public employees.”
The lawsuit, which is likely to end up before the state Supreme Court, names Gov. Rick Scott as a defendant in his role as chairman of the State Board of Administration, which oversees the $131.5 billion pension system’s investments. The board’s other two members, Attorney General Pam Bondi and Chief Financial Officer Jeff Atwater, also are defendants.
The unions contend the new law violates public employees’ contract, property and collective bargaining rights under the Florida Constitution.
The new law requires teachers, state and county workers and some city employees to contribute 3 percent of their salaries to the Florida Retirement System.
As a result of Fulford’s decision, the pension fund began deducting 3 percent from the pay of 560,000 public employees on Friday. The contributions are expected to save the state and local governments $806 million in the first year as their contributions to the retirement system have been reduced.
“This is a minor setback and cannot be viewed as a determination that our claims are not just,” union lawyer Ron Meyer said Friday.
During Thursday’s hearing, Meyer argued that the contributions should be separated to ensure employees would get their money back if they prevail in their legal challenge.
They cite a 1974 law that did away with employee contributions and declared pension rights are “contractual in nature.” Meyer acknowledged that the Legislature can change the law for new hires but argued it still applies to existing employees.
Florida union leaders argue that their members have taken lower-paying jobs in exchange for better benefits including fully funded pensions.
Scott had urged the Legislature to require contributions of 5 percent, contending it’s a matter of fairness since employees in the private sector and in other states already contribute toward their pensions.