When President Franklin Delano Roosevelt signed the original Social Security Act (SSA) in 1935, no state or local-government workers were eligible. That didn’t change until the 1950s when the SSA was amended to allow state and local governments to enroll their workers. Allow – not mandate: teachers in Alaska, California, Colorado, Connecticut, Georgia, Illinois, Kentucky, Louisiana, Maine, Massachusetts, Missouri, Nevada, Ohio, Rhode Island and Texas were never enrolled in Social Security.[i] The public employees (teachers, police, firefighters, etc.) in these states got a state-pension system instead.
For years, teachers in these states who paid into social security through a separate job or who had a spouse that paid into social security got their full social security benefits when they retired. They got social security on top of their state-pension benefits, which lead some people to think that they were getting more benefits than they deserved – even though these families had paid into the different retirement programs, just like everyone else.
That all changed with the Windfall Elimination Provision (WEP) in 1983 and the Government Pension Offset (GPO) in 1977. The WEP impacts your social security benefits if you’ve paid into social security through a different job and GPO impacts your spousal survivor/dependent benefits.
Windfall Elimination Provision: If you paid into social security through another job then the WEP reduces your Social Security and/or disability benefit depending on how much of a benefit you earned and at what age you retire. So, basically, you don’t get all the money that you otherwise would have because you have a state-pension instead. Practically speaking, the WEP has had incredibly negative ramifications for teachers in states like Louisiana, especially if they’ve spent a large part of their working life in the private sector.
Government Pension Offset: The GPO reduces your survivor or dependent social security benefit by two thirds of your pension benefit. So, for example, if you receive a $600/month payment from TRSL and you are eligible for a $500 spouses social security benefit then two thirds of your TRSL payment (or $400) is deducted from your Social Security benefits. So, you would be left with $100 social security payment, or $700 total when you combine social security and pension benefits ($100 SS + $600 TRSL).[ii]
This can be incredibly devastating for many teachers and support staff who rely on the income of a spouse. Your social security benefits will be reduced if your spouse passes before you. Too many retired teachers have had to say goodbye to their spouses and in the midst of that trauma find out that they’re also losing a huge portion of their household income.
Even more tragically, many people are impacted by both the WEP and the GPO.
That is why Louisiana Federation of Teachers supports the Social Security Fairness Act, which would repeal both the WEP and the GPO. Detractors of the repeal say such a dramatic shift would simply cost too much (and the legislation does carry a $40 billion fiscal note), which is why LFT and AFT have also worked with U.S. Representatives to develop the Public Servants Protection and Fairness Act (PSPFA) – a more measured step towards undoing the damage of the WEP and GPO.
The PSPFA seeks to fix the WEP by creating a more reasonable formula to calculate how much social security we should get. Under the PSPFA, current retirees would receive an extra $150-per-month and future retirees’ social security benefits would be calculated in a more equitable way.[iii] PSPFA was proposed in the U.S. House Committee on Ways and Means in the 116th Congress (2019-2020) and would require approval from the US congress – this problem can’t be fixed on the state level. We encourage our entire Louisiana congressional delegation to support this legislation. Ask your U.S. Representative and Senators to stand up for public employees in Louisiana and fix Social Security.