Compliance May 12, 2002

NC Workers Denied Again

December 5, 2002 (PLANSPONSOR.com) - Workers in North Carolina, fighting to have $151 million in withheld pension funds returned to them, have lost their appeal to the state courts, according to an Associated Press story.

Reported by

Eric Hazard

The State Employees Association of North Carolina (SEANC) has been fighting to have pension funds returned to them that were withheld in 2001 by Governor Mike Easley to address $850 million in budget shortfalls.

However, in a 2-1 ruling, the state appeals court upheld the lower court ruling that employees have no standing to bring the lawsuit. Writing for the court, Judge Douglas McCullough cited precedents requiring every association member to show potential harm by the state’s actions.

Additionally, he said the association has failed to show how members would suffer a “distinct and palpable injury likely to be remedied by granting the relief requested.”

The North Carolina legislature, which made no contributions to the state pension fund in 2002, has promised to begin repayment of the money in 2003.

Even though money was withheld in 2001 and no payments were made last year, financial experts say the $58 billion state pension fund is sound enough to meet future obligations, according to the story.

The SEANC said it plans to appeal to the state supreme court.