NJ Legislature Approves Cuts to Public Worker Benefits

June 24, 2011 (PLANSPONSOR.com) - New Jersey public employees will receive smaller pensions and be required to pay more for health-care benefits under a new bill that recently won final approval in the state Legislature, the Wall Street Journal reports.  

Workers will be required to pay more into their pensions and for their health care, and their contributions will be calculated as a percentage of premiums instead of salary. New employees will be forced to work longer to get a full pension. One local union has already filed a lawsuit against the provision that will eliminate automatic cost-of-living increases for everyone in the system, including retirees.  

According to the news report, a roughly $120 billion gap exists between what New Jersey owes workers and what it has saved, and these, among other changes, are expected to save the state $120 billion in the next 30 years, though the health-care numbers are harder to predict. Unions said the bill attacked collective bargaining by making cuts to health care through legislation. But, Governor Chris Christie said it was the only way he could change plans at the local level, as well as nationally. 

Workers gathered to protest at the Statehouse in Trenton when the bill was up for vote.

Christie is expected to sign the bill next week.  


Sara Kelly