Protecting Pensions from Attack
Correctional workers from across Minnesota are gathering to learn how their pensions work – and to fight to keep them.
More than 30 correctional officers and workers from Locals 600 and 915 gathered at the Minnesota Correctional Facility in Stillwater Thursday to attend pension seminars led by Sgt. Joe Strunk, a Minnesota State Retirement System board member. More meetings are planned at prisons around the state.
“Anybody who wants to be vested in a public pension needs to be active in a public pension,” Strunk says. “They need to be informed and stay informed, and we need people to be involved.”
The seminar was organized by Local 600 president Dan Gorman and Local 915 president Jeff Vars. It was one of a series of actions planned this year by the Corrections Policy Committee, headed by president John Hillyard.
Public pensions are under attack, Strunk says. Some lawmakers want to move workers who have earned public pensions (known as defined-benefit plans) toward a defined-contribution plan like a 401 (k). Workers would then have to rely on the market and hope for the best.
“A defined benefit is money for life,” Hillyard says. “With defined contribution, when that runs out, you’re done. It’s a big difference between what we’ve got and what they’d like us to go to.”
Another related legislative proposal that keeps coming back would create a two-tier system: Older workers would keep their pensions while younger workers would shift to 401 (k)-type plans. Neither of these proposals – both promoted by wealthy special interest groups – is good for workers, Strunk says. Along with making retirement less secure for younger workers, it would endanger existing pensions because governments would stop paying into pension funds when the number of newer workers reached a critical mass.
Retiring with dignity
Some lawmakers tend to forget that workers earned those pensions through years of public service.
“We took lower wages so we could get good health care and a good retirement,” Strunk says. “Now is not the time to change that.”
“By the time I go, I’ll have about 35 years of service,” says Theresa Dunn, an office and administrative specialist at Stillwater and Local 600 member. “I’d like to have the same standard of living when I retire and not have to live in poverty or work constantly. I’d like to retire completely.
“I worked hard for it,” Dunn adds. “I deserve my pension.”
Fighting the myths
Groups like the Center of the American Experiment want the public to believe pensions will bankrupt government. But that’s a myth.
“Pensions that have been fully funded and well managed are viable pensions that have remained viable through the Great Recession,” Strunk says. “The belief that because the public doesn’t have a pension like this, nobody should, should be the opposite. Our lawmakers should be finding ways of changing the laws so individuals have pensions like us where they can retire in dignity.”
It’s actually in the public’s interest for governmental bodies to offer strong pensions because they help recruit and retain workers, especially in places like prisons where the job is so stressful. That’s why correctional workers who spend most of their time directly responsible for inmate care are eligible to retire at 55.
Without pensions, Gorman says, “I think we would lose roughly half of our workforce. With that you lose experience, and at that point, it becomes a revolving door.” That’s less safe for workers, inmates and society.
Derek Magle, a correctional officer at Oak Park Heights, says young workers may not realize how much pensions matter when their own retirement seems so far off.
“When I started, I didn’t care about pensions or any of that stuff,” Magle says. “The first five years, I didn’t even think about it. I figured I could just find another job. Now I’ve got 11 years in, I don’t want to leave. I couldn’t find another job with the benefits I have.”
Magle’s wife has a great job, too. But when they sat down and figured out how much she would have to save for retirement to equal what he’ll earn in his pension, they discovered it was an “insane amount,” he says. The couple decided that even though he could find a job that paid more, it didn’t make sense for him to move.
“It’s not just the take-home pay,” he says. “It’s the future you have ahead.”
Magle is joining correctional workers at the Capitol to fight for their pensions. Each week this legislative session, a large group of men and women dressed in uniform blues have headed to pension hearings alongside other AFSCME members and retirees, presenting a united and impressive front. They plan to keep attending every hearing, too.
Lawmakers are paying attention: They know that each of those dark-blue uniforms and AFSCME T-shirts represents votes.
“It’s putting a face to the cause,” Vars says. “No one knows you care about it until you show up.”
Strunk and Hillyard’s Tips for Retirement with a Public Pension:
- When you retire, you will likely take a reduction in income. Start planning early.
- Look at your pension statements. Update your plan with changes like different jobs or a divorce. Have needed documentation in the hands of your pension plan well before you retire.
- Make sure MSRS credits every year of service.
- Check Social Security statements, too.
- As you get closer to retirement, take an MSRS class. Consider scheduling a one-on-one.
Make sure you contribute enough to deferred compensation to at least get the employer match where it’s available.