CA: Pensions for city workers can't be cut, but pay can, judge rules in major San Jose case

San Jose Mercury News ^ | December 23, 2013 | Mike Rosenberg

[fifedom]

The tentative decision prohibits the city from forcing current employees to contribute significantly more toward their pensions, as called for in last year's Measure B.

That left each side claiming victory, even as both expected to appeal.

[fifedom]

According to the loony judge, once you get a government job that locks in your retirement, insurance, etc. benefits as of that time and the city cannot change that going forward. CA is doomed but if this holds on appeal it will speed up the crash and burn.

[Eric in the Ozarks]

This ruling will last 5 minutes before an appeal...

[dragnet2]

Try to imagine private sector jobs where your pensions, insurance and benefits are locked in and the employer can’t touch them and it takes a act of congress to even fire you...

[umgud]

Sumpn’s gotta give.

[Vendome]

Pension reform has to take place and it should apply to all new employees and be part of negotiated agreements in the future .

Also, any officer hired should sign a contract obligation him to 5 years or the employees will pay back the costs for training.

[VRWC For Truth]

When the cupboard is bare, good luck collecting ...

[JABit]

Too bad they don’t give the same consideration to our military.

[cherry]

so for new employees, Measure B can be activated.....its just the precious fannys of the current workers and the precious retirees that can't be touched...

so what we have here is the old again robbing from the young....the haves and the have nots....

these retirees and older workers just don't care that their obscene pensions and benefits are borne on the back of the new workers, often the young with young children...

[TheConservator]

This was a ruling under California state law.

It is irrelevant to what happens when a city files for bankruptcy. What happens in bankruptcy court is generally governed by federal bankruptcy law. Under bankruptcy law, pension benefits can be cut. What this state court judge claims state law requires about pensions will not be relevant.

[Dapper 26]

Bankruptcy is the only way out. DO IT NOW!!!

[kingu]

So, according to this judge, every time a city employee is hired, they automatically become an elected official who determines future budgets.

Because, in the fantasy world, that is what people are elected to do; make the city budget. In this judge's reality, people are elected to simply approve previous city hirings and benefits promises.

Probably because judges have their own compensation plan and those too are lifetime benefits, and without rubber stamping all other big benefits, theirs too might be on the chopping block.

So pay up, all cities, give all the people's money to...the government employees.

[HarleyD]

Pension reform is needed but once the government/companies makes a promise of a pension, they should be held to paying for that pension. People make decisions based upon benefits offer and if one person takes a lower paying job with a guarantee of a pension verses a higher paying job with no pension, the government/company should have to follow through on that. Few on this site would argue that our military pensions should be cut. It's the same principle.

[tbw2]

We’ll probably see a lot of cities declare bankruptcy just to break the union contracts, whose Baby Boomer retirement and teacher’s pension and benefit promises they cannot keep.

[dragnet2]

Pension reform has to take place and it should apply to all new employees and be part of negotiated agreements in the future .

No, it's choking off and economically gang raping the private sector...This needs to be applied to existing personnel and those already retired as well as new hires.

[mrsmith]

No one minds military pensions being cut-as appropriate. The appropriate cutting of them would be last and least.

The principle is that no legislature can bind a later legislature. It would make a mockery of their democratic nature.
I assume the judge found something in the state’s constitution that bound the legislature to the contract.
Using some counterargument to the old “the constituion is not a suicide pact” reasoning..

[HarleyD]

Personally, I mind. Pensions should not be cut-neither military, government or public. It undermines agreements by which people have made financial decisions. There is nothing wrong with reducing pensions/social security on the future workforce. But cutting existing pensions on people who are either retired or planning to retire is just plain wrong.

How many will complain when the government takes everyone's 401K? They will do it under the same guise of trying to fix the budget.

[fifedom]

once the government/companies makes a promise of a pension, they should be held to paying for that pension.

The judge says you cannot change the pension for people who are currently hired and may have been on the job for only a few months.

For these people, maybe they should get some credit for the time under the old system but in the private sector they can change the terms at any time going forward even for people who are employed at the time.

Once someone is retired that is a different story. In places like CA where government employee unions are allowed, they basically own the politicians. They give them anything they want. I see no problem with scaling back the bennies that the retirees gained through manipulating the system. This will probably have to be done in bankruptcy court like they are doing in Detroit.

[mrsmith]

Well, then you leave inflation as the answer. People get the full dollar amount they were promised.

That requires no setting of priorities. The general nature of that solution will be more damaging to pensioners than targeting spending cuts by priority IMO.
Thouigh maybe not.

[dragnet2]

It undermines agreements by which people have made financial decisions. But cutting existing pensions on people who are either retired or planning to retire is just plain wrong.

BS...No one asked me or anyone I know if government employees should get guaranteed lottery style tax paid benefits and pensions. Why should they be guaranteed anything?

It's choking off and economically gang raping the private sector...This needs to be applied to existing personnel and those already retired as well as new hires.

[Dapper 26]

Indeed. My local town is headed in that direction, accelerating the who way.