09/05/09 152 W - + 6 - 7 State Crackdown Stymies Retirement Plans of Raleigh Workers


That's the headline from yesterday's WRAL story about a surprise change to the benefits of City of Raleigh employees. For decades, firefighters, police officers, and other city workers have been banking their sick time to apply toward retirement. This week, the Department of the State Treasurer notified city officials that that practice is illegal. The problem, notes the news story, is that city works accrue sick time in intervals, versus on a monthly basis. Both city and state leaders plan to meet next week, to see about working on a compromise. For now, the state is grandfathering all existing retirees, so they won't lose the benefit. Read the article, which includes an interview with a firefighter close to retirement and immediately impacted by the new rule. We're also watching for coverage from other outlets, to learn more and read more details about what's happened.



Well, there goes retiring in 8 years… Gotta work one year more now. This really sucked for many of my coworkers who were planning to retire within the next 6 months. ...and it inadvertently affects the upcoming promotional prospects too.

There’s a new Sheriff in town and her name is Bev! I believe if you look between the lines, you’ll see a underlying motive for cost savings at the state level – related to the retirement system. Go figure… it’s not been illegal until now.
A.Rich - 09/05/09 - 22:24

Not being a Raleigh employee but working with a lot of them, my $0.02 worth. You cannot tell me that they did not see this before now. There are all sorts of documents forms, files, etc. AC is right, this is nothing more than a ploy to save money at one end to spend/waste it on another.

Unfortunately, I believe you will see more crap such as this in the future- certification fees, fees for training, and more.

Just wait. BOHICA!
DJ (Email) (Web Site) - 09/06/09 - 10:17

What I don’t understand is, if you let that $75,000 a year employee retire, you can hire one in their place for $32,000. Isn’t that significant savings?
Silver - 09/06/09 - 11:51

You’re right Silver, it saves the City a ton of money in salary and benefit contributions, however I feel the driving factor is the STATE’s ability to save a little money by not paying out of the retirement system as early as planned, thus making THEM more interest. Just an apparent assumption… although there are probably many more perspectives and facts.
A.Rich - 09/06/09 - 12:48

Technically you couldn’t replace an employee until they are officially retired not just out on sick leave. Maybe I’m not understanding this correctly but isn’t that how people actually “retire” early?
RescueRanger - 09/06/09 - 16:03

DJ, I haven’t heard BOHICA since I was in the Army…nice.
Kermit - 09/07/09 - 02:00

RescueRanger,

That’s not how it works. They are able to use accumilated sick leave to count towards their years of service. Thus when they have 1 year of sick leave they are able to retire with 29 years on the job and get credit for 30 years of service. It’s kind of like them turning the leave in in exchange for that much service time. The pay is still based on the average of the highest 3 years. Your retirement is official at that time, it just gives you that much more years of credit in the system using your sick leave. The agency can then immediately replace that employee as they are no longer on the roster.

I just cannot understand how the City HR people did not know about this, or if they have since changed the policy themselves… or if they’re going to try to get people grandfathered in, or what the next step is, as it is completely unfair to the employees, who could do nothing about how they accumulate their sick leave, and thought all this time they were going to have the same benefit as those that came before them cashing in their sick leave to reitre early!
CFP 7021 - 09/07/09 - 02:32

I thought it was if you have 1 or 2 years of accumulated sick leave you could use it for retirement but you could not leave early. For example, with 2 year of sick leave you could retire after 30 years but get credit for 32 years. That is at least how I was told it works. So I guess it would not really be fair for the state to allow Raleigh to do it that way and not any one else.
Spanky - 09/07/09 - 09:22

How long has this practice been going on, 30+ years? New State Treasurer comes along and her office says they only learned of it in July. It took 30 years to realize its illegal. BULL. Someone has to sign off on every retirement paper that comes along. Ms. Cowell, our esteemed State Treasurer, served how long on the Raleigh City Council. Why didn’t she bring it up then. No wonder this done quietly, with no notice given?
Jakey - 09/07/09 - 14:39



  
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