WEAC, MTEA, Educators File Suit Over Retirement Money
Wisconsin teachers and school support staff are being
denied opportunities for higher pay raises as the result of a state agency's
illegal method of implementing the new public employee retirement law,
according to a lawsuit filed Tuesday (November 13, 2001).
The lawsuit claims that the State Employee Trust Funds
Board is violating the law by allowing school districts to re-direct money
they save as a result of the retirement law, known as Act 11. That money
then becomes unavailable for staff salary increases.
The suit was filed in Dane County Circuit Court by WEAC,
the Milwaukee Teachers’ Education Association, and several educators.
The new retirement law – which was declared constitutional
by the Wisconsin Supreme Court last June – provides significant pension
improvements for public employees. It also provides significant savings
– a $200 million credit – to employers, who contribute to the
employees' retirement funds through the Wisconsin Retirement System.
The law states that the DETF must require the municipalities
and school districts to take their employers' credit on a monthly basis,
effective March 1, 2000, as a holiday from payments they owe for contributions
for past liability. The payment holiday approach may free up school district
funds that can be applied to salaries under the complicated Qualified
Economic Offer provision of the teacher bargaining law.
However, the DETF has told employers they can also choose
to either save up the credits or apply them to unfunded liabilities and
regular contributions at the same time. When districts choose one of these
other options being allowed by the DETF, they effectively redirect the
money so it is not readily available for staff salary increases.
“The Legislature’s intent was very clear,”
WEAC President Stan Johnson said. “The DETF is improperly implementing
the employer credit, thereby denying public school employees funds that
could be used for compensation.”
“This interpretation is in direct violation of
clear statutory language,” MTEA President Bob Lehmann said. “The
state is allowing employers to avoid the payment holiday that would free
up funds that were supposed to go to employee compensation. The result
is that teacher compensation continues to suffer.”
Johnson said the DETF interpretation came as a surprise
to the parties involved in the legislation.
Johnson pointed out that when Gov. McCallum vetoed changes
to the QEO in the budget, he specifically noted that the retirement law
would provide funds for teacher compensation.
The governor’s budget veto message promised the
employer credit would provide school districts with what the governor
called an “$84 million windfall, much of which will translate into
enhanced compensation packages for teachers.”
“The DETF interpretation of ACT 11 compounds the
injustices of the Qualified Economic Offer law, which restricts teacher
compensation,” Johnson said. “Teacher morale and labor peace
throughout Wisconsin have been eroding since the QEO was imposed in 1993,
and teachers have seen compensation fall below the national average and
not even keeping up with the rate of inflation. The DETF is making a bad
situation even worse.”
WEAC and MTEA are asking the court to declare the DETF
implementation of the law is illegal, and to require the department to
follow the monthly holiday method as required by the legislation.
Posted November 14, 2001