GPO/WEP Hearing Scheduled for November 6!!

The Senate Finance Committee's Subcommittee on Social Security, Pensions, and Family Policy, chaired by Senator Kerry (D-MA), held a hearing on the Government Pension Offset (GPO) and Windfall Elimination Provision (WEP) offsets on Tuesday, November 6.

Massachusetts Teachers Association/NEA Retired member, Peggy Kane -- a high school English teacher for 35 years who retired four years ago from the Medford Public School system in Massachusetts -- testified at the hearing. You can add your thoughts and opinions to the record by submitting written comments to the subcommittee no later than Nov. 20, 2007.

The hearing is a huge victory for NEA members and other activists who have been pushing hard for movement on legislation to repeal the GPO and WEP.

The Subcommittee will accept written submissions for the record. Your statement must be typewritten and single-spaced, not exceeding 10 pages in length. The first page must clearly state your full name and address as well as the title and date of the hearing ("GPO and WEP: Policies Affecting Pensions from Work Not Covered by Social Security" November 6, 2007).

Statements must be MAILED (not faxed) to:

Senate Committee on Finance
Attn. Editorial and Document Section
Rm. SD-203
Dirksen Senate Office Bldg.
Washington, DC 20510-6200b

Statements must be received no later than two weeks after the hearing. In submitting a story for the record, please:

• Follow exactly all the submission standards as outlined above.
• Be clear and concise in your message.
• Tell your story using polite language and urge Congress to repeal the GPO and WEP.
• Be sure to correct all spelling or grammatical errors prior to submitting.

For more information and the latest GPO/WEP news and to send your elected representatives in Washington a message, visit  NEA's Legislative Action Center.

Affected Employees Must Be Warned About Offsets

Law Requires Notice for Those Not Covered by Social Security

NEA has long argued the need for the Social Security Administration and employers to advise employees in jobs not covered by Social Security of the impact of offsets on their Social Security benefit entitlement. Now public employers in non-Social Security states  and districts must alert new employees affected by Social Security offsets.

Section 419(c) of Public Law 108-203, the Social Security Protection Act of 2004 requires State and local government employers to disclose the effect of the Windfall Elimination Provision and Government Pension Offset Provision to employees hired on or after January 1, 2005 in jobs not covered by Social Security.

These employees also must sign a statement that they are aware of a possible reduction in their future Social Security benefit entitlement.

Employers do not have to create the notice. The Social Security Administration has produced form SSA-1945, Statement Concerning Your Employment in a Job Not Covered by Social Security for new employees to sign. This form, along with instructions for its use, can be found at www.socialsecurity.gov/form1945.

Learn more about how the Windfall Elimination Provision and Government Pension Offset Provision unfairly penalize public employees and read about the history of these offsets.

Provisions Unfairly Target Public Employees

The Government Pension Offset and Windfall Elimination Provision apply only to persons receiving public pensions, not those receiving private pensions. While retired public employees have their Social Security or survivor benefits reduced, non-public employees with private pensions get to keep their entire pension and receive their full Social Security or survivor benefits. The Government Pension Offset and Windfall Elimination Provision thus severely and unfairly limit the retirement benefits of public employees.

The Government Pension Offset and Windfall Elimination Provision substantially reduce benefits that workers and spouses had counted on when planning their retirement. The arbitrary Windfall Elimination Provision formula does not eliminate "windfalls." Rather, because of its regressive nature, the Windfall Elimination Provision causes a relatively larger reduction in benefits to low-paid workers. It also penalizes lower paid workers with short careers or those whose careers are evenly split inside and outside the Social Security system.

Educators Should Be Able to Count on Equitable Share of Income

A significant number of teachers have decided to turn to teaching late in life after years in private sector employment. Many women work part time in the education profession while also spending more time at home to raise their children. These educators have relatively limited service and their chosen career path provides a modest public pension. Individuals who held jobs in Social Security-covered employment, or who are eligible for Social Security based on their spouse's covered employment, should be able to count on a more equitable share of that income to sustain them through their retirement years.

Both the Government Pension Offset and Windfall Elimination Provision can affect some individuals. The application of these provisions can have a severe impact on the financial security of retirees who have spent some portion of their working careers serving the public (e.g., educators, police officers, fire fighters and many other federal, state and local government workers).

Nine of 10 Lose Spousal Benefit

Estimates indicate that nine out of 10 public employees affected by the Government Pension Offset lose their entire spousal benefit, even though their deceased spouse paid Social Security taxes for many years.

The Government Pension Offset and Windfall Elimination Provision have the harshest impact on those who can least afford the loss: lower-income women.

According to the Congressional Budget Office, the Government Pension Offset reduces benefits for some 200,000 individuals by more than $3,600 a year. The Windfall Elimination Provision causes low-paid public employees outside the Social Security system, like teachers and other education employees, to lose up to 60 percent of the Social Security benefits to which they are entitled. Ironically, the loss of these benefits may make these women and men eligible for more costly assistance, such as food stamps.

There are also a significant number of people eligible for retirement who have been forced back into the workforce to make up for the effects of the Government Pension Offset.

States Where Public Employees
Are Not Covered by Social Security

• Alaska
• California
• Colorado
• Connecticut
• Georgia (certain local governments)
• Illinois
• Louisiana
• Kentucky
• Maine
• Massachusetts
• Missouri
• Nevada
• Ohio
• Rhode Island (certain local governments)
• Texas (certain local governments)

Stories from real
people hurt by GPO, WEP

Thinking of Quitting Teaching in California
Penalized for Teaching in Illinois
Losing Widow's Benefits in Indiana
Severe Financial Penalties in Maine
Facing Poverty in Ohio
Penalized Unjustly in Texas
Discriminated Against in Massachusetts
A Dismal Retirement Prospect in Illinois
Rethinking the Choice to Teach in Maine
Grossly Unfair in Missouri
Feeling Cheated in Massachusetts

Thinking of quitting teaching in California

I have worked since 1961 including fifteen years in the private sector where the only retirement was Social Security. I also held summer jobs that required Social Security payments. For the past 14 years I have been teaching in public schools and participating in my state's retirement system.

Because of this I will not be allowed to receive my own Social Security. This is so unfair. I have paid into the system and now I will not be allowed to collect what belongs to me.

I have been advised to quit teaching and take another job, so that when I retire, I might get my teacher's pension and my Social Security. Is this fair when there is a teacher shortage and I love my job?

--An educator from California

Penalized for teaching in Illinois

I am a retired teacher after 40 years of service. I am currently drawing a teacher's retirement in Illinois. When I become 65 I will be unable to draw anything on my husband's Social Security, even though he has been disabled for 20 years and I have been the sole support of the family.

On the other hand, his cousin, who has never worked a day in her life, draws Social Security on her husband's benefits. Is this fair? Of course not!

I am penalized for working in the teaching profession for 40 years instead of in private industry, where I would be able to draw on my husband's Social Security. Is this any way to draw qualified teachers to the profession?

--An educator from Illinois

Losing widow's benefits in Indiana

I am a retired Illinois teacher who is directly affected by the Government Pension Offset to Social Security because I draw a Teacher's Pension from the state of Illinois.

My husband worked in the private sector for nearly 35 years and paid into Social Security. He died in November of 1999. At the time of his death he was receiving about $1,200 per month in Social Security benefits.

When I applied for my survivor's benefit, I learned that I would receive nothing from my husband's Social Security benefit. I feel that this is totally unfair. The amount that my husband paid into Social Security has absolutely nothing to do with my Illinois Teacher's Pension. I should be receiving my widow's portion of his Social Security.

I have moved to Indiana to be nearer my family and I have learned that Indiana teachers are able to receive Social Security. The law that stops me from receiving a portion of my husband's Social Security is unfair for many reasons and should be changed. At my husband's death, I not only had to face the dramatic loss of my husband, but also a great portion of my income.

This just should not be and that law must be changed.

--An educator from Indiana

Severe financial penalties in Maine

I worked in the private sector for more than forty quarters (fifteen years at least) and only returned to teaching ten years ago.

For my years of service as a teacher, I anticipate receiving a monthly income of $1,200. My estimated Social Security benefit would have been close to $700 a month, but because of the offset, I expect around $120 a month from a system to which I made regular contributions.

If my spouse dies, I will not receive anything from his Social Security, although he too has paid into it his whole life. If I had known the severe financial penalty I was to pay for returning to teaching I don't think that I would have done it.

--An educator from Maine

Facing poverty in Ohio

I worked for 15 years under Social Security; even when I owned my own home-based business to stay home with my daughter for 5 years, I was careful to fill out all the paperwork and contribute to the system every quarter.

Then there was a big push for people in private business to go into teaching: Our expertise, experience and qualifications were badly needed.

Two years later Congress enacted the offset - cheating me out of my hard-earned Social Security just to balance the budget on the backs of many hardworking teachers.

I am now 54 years old. In order to retire with a full state pension I will have to teach until I am 73 years old. I counted on having 20 years under teacher's retirement and 15 years under Social Security.

Now, with the offset, I am facing retiring in poverty at about $16,000 per year. I believe there are many women in my position who will face a poverty-stricken retirement. Does anyone care about us?

--An educator from Ohio

Penalized unjustly in Texas

I worked both as a teacher and as a Registered Nurse and I have paid fully and completely into both Social Security and my teacher's pension fund for retirement.

I will be penalized unjustly in my own Social Security benefit for having worked as a teacher. The offset is much greater when they take away your justly earned Social Security.

We need teachers and we need nurses. Must I live in poverty in my retirement because I worked hard in both these areas but will only be compensated for one?

--An educator from Texas

Discriminated against in Massachusetts

I taught in a state that deducted Social Security for four years; I then moved to a state that didn't deduct Social Security. I also worked at various jobs while in college, prior to college and during some summer vacations. So, I have earned a right to Social Security benefits even though I am receiving a teaching pension.

I find the offset program totally reprehensible!!! Why can't I get the total benefit that any other worker would receive? The small amount that I would receive would make retired life somewhat more manageable. I am being discriminated against just because I worked hard and paid into the program!

--An educator from Massachusetts

A dismal retirement prospect in Illinois

Together, my husband and I worked a total of 78 professional years, he as an
attorney and I as a teacher. My monthly state of Illinois pension of $1,700 prevents my drawing any Social Security as a spouse, since my entitlement thereto would be less than my monthly pension.

In my own right, I have earned sufficient quarters under social security
to be entitled to my own benefit, but since there is a correction of $2 out of every $3, my grand total of social security benefit in my own entitlement is $166 per month. Simple arithmetic tells me that my annual retirement income is $22,392, hardly regal after 37 years of teaching.

Both my husband and I have paid for benefits which we
are now denied, and my retirement income is hovering dangerously low. Yet Social Security tells me that under current law, neither my husband nor I will ever receive anything from each other, even after one of us dies. This is a dismal prospect at our ages of 63 and 62.

--An educator from Illinois

Rethinking the choice to teach in Maine

This is my second year teaching and I absolutely love it. In my former life I contributed the maximum amount of Social Security each year. In the late seventies, there were few if any positions open and since I paid for my education on my own, I needed to pick an alternative career. In the late 1990's I responded to the pleas I heard in the news media - we need teachers!

Now I am rethinking my choice as I worry about my retirement. Had I known that I would lose my Social Security contributions, perhaps I would have chosen a different state or stayed in private industry. I entered the teaching profession, realizing I would take a tremendous cut in pay but thought that my years of maximum contributions into Social Security would still be enough to provide an adequate living allowance in retirement. I haven't had the heart to try and calculate just how much I have to lose. The thought is far too depressing. When I do get the courage to figure it out, is it too late to leave the education system and avoid penalty? Somehow I think my fate is sealed.

The president and nation still cry about the crisis of the nation's educators nearing retirement age. The low pay does little to attract the best of our nation's youth and does little to attract converts like myself. But when coupled with the reduction of social security benefits, it makes matters worse. Many of my former coworkers are also interested in becoming educators. Their kids are older, houses paid for and life is more stable. As soon as I mention the penalties, their interest diminishes.

There is a wide pool of talented, intelligent, innovative and mature business professionals that could benefit our education system. Until these penalties are eliminated, our educational system will continue to discourage people from joining this admirable and noble profession.

--An educator from Maine

Grossly unfair in Missouri

My husband has earned benefits under Social Security from teaching in Oklahoma and from work in construction and insurance sales that would entitle him to $980 month. The last 20 years of his teaching career (out of 35 total) were in Missouri. He retired from this position. Now his Social Security is reduced to only $379 per month.

I also understand that even though all of my Social Security benefits were earned in Oklahoma (a Social Security state) that in the event of my death his benefit under my Social Security would also be reduced by 2/3 of his Missouri teacher retirement. It is interesting to note that if my husband had never worked at all and never paid anything into Social Security, he would receive 100% of my benefits in the event of my death. Grossly unfair!

We need to repeal this unfair law!

--An educator from Missouri

Feeling cheated in Massachusetts

I served 13 years in the military and am a wartime veteran. I did not receive a military pension, however, I did pay into Social Security. I am shocked to learn that I may receive virtually nothing from Social Security. My teaching pension in Massachusetts will be small if I retire at 60 with only 22 years of teaching service. I had previously thought that Social Security would help to make up for the smaller teaching pension. I feel that the federal government is unfairly penalizing those who have embarked on second careers as teachers. They have created a disincentive that will work against filling projected teaching shortages. I feel especially cheated as I did sacrifice much during my military career. It is obvious that I would be much better off financially had I not served at all. I hope this is not the message that the government wants to send.

--An educator from Massachusetts