Last spring, the Fix Tier Six campaign supported by PSC members through our statewide affiliate, NYSUT, convinced the governor and state legislature to change the way the final average salary (FAS) is calculated for state pensions. This applies to full-time and adjunct employees enrolled in the TRS defined benefit pension plan who were hired on or after April 1, 2012 (Tier VI). Instead of using the average of the highest five consecutive years to determine the FAS, the highest three consecutive years are used.
This victory is the biggest win for pension reform in 20 years and provides a substantial benefit to our Tier VI members in TRS.
The new calculation means Tier VI members retiring after April 20, 2024, will receive a bigger pension check, every month, for life. Individual situations will vary, but this works out to around $100,000 more in lifetime retirement earnings. It also gives Tier VI members parity with Tier IV members.
FIX DISPARITIES
The Fix Tier Six campaign aims to change the disparity between Tier VI and Tier IV members by improving Tier VI benefits. It is led by NYSUT and supported by the PSC and more than 1,200 local unions. In 2022, the campaign led to pension vesting dropping from 10 to five years, bringing thousands more into the pension system.
“It is fantastic that their campaign was able to reduce the calculation for the FAS from the highest five consecutive years to three,” said Diana Menna, the vice chair of the PSC retirees’ chapter. “I’m not sure exactly how they arrived at the estimate of around $100,000 more in lifetime retirement earning, but it certainly will be beneficial. Also, being vested after five years instead of 10 is helpful to many, particularly those who leave employment early.”
Published: October 29, 2024
