FL Teachers Group Sues over Diversion of Pay to Pensions

June 21, 2011 (PLANSPONSOR.com) - The Florida Education Association has filed a class-action lawsuit against Governor Rick Scott and other trustees of the state retirement plan for unconstitutionally imposing a 3% pay cut on teachers and state employees.

The St. Petersburg Times reports that workers are asking the court to sequester the more than $1 billion the state is saving by cutting the take-home pay of teachers and state employees. The lawsuit alleges that the state violated its contractual obligation to state workers when it shifted money from worker pay to replace some of the state’s obligation to pay into the Florida Retirement System.   

According to the Times, the union says that state law expressly provides that the FRS is one in which employees do not have to contribute part of their salaries, and the shift impairs those contractual rights.  

Scott and state legislators argued the change was needed to bring state retirement accounts in line with the private sector, which require workers to contribute into their retirement accounts; however, the money was not used to enhance employee benefits but to relieve the budget deficit.   

The news report said FEA president Andy Ford contended: “It is essentially an income tax levied only on workers belonging to the Florida Retirement System. It’s unfair — and it breaks promises made to these employees when they chose to work to improve our state.”