Pension spiking and city firefighters

Photo: Rich Pedroncelli, AP

Last week in the LA Times: ‘Pension spiking’ not protected by California law top court rules

For two decades, it was a treasured perk for some county employees across California: the ability to boost their pensions by cashing out unused vacation or sick leave, or working extra hours, at the end of their careers. In some cases, workers received more in pension payments than they earned while working.

But with the state’s economy struggling and a pension crisis looming, then-Gov. Jerry Brown backed a sweeping reform measure in 2013 that prohibited county workers from “pension spiking.” Labor unions sued to overturn the new law. 

On Thursday, in one of several closely watched pension cases, the California Supreme Court sided with the state, unanimously upholding a provision of the 2013 law that prohibited pension spiking by county workers.

In a decision written by Chief Justice Tani G. Cantil-Sakauye, the court said the law that ended pension spiking for county employees was enacted “for the constitutionally permissible purpose of closing loopholes and preventing abuse of the pension system”...

Rob's comment:

I posted about this way back in 2010 based on a Civil Grand Jury report, Pension Tsunami: The Billion Dollar Bubble.

From my post:

But the Grand Jury found that some cops and firemen are gaming the retirement system to puff up their pensions. It's called "pension spiking." The year before they retire some workers "artificially inflate their final compensation just before retiring, in order to increase their pensions," as the 2008-2009 Grand Jury reported ("Pensions: Beyond Our Ability to Pay"). Pension spiking by increasing your overtime has been illegal since 1976, but, with the necessary collaboration of fire and police management, it's now done by simply assigning favored people to a higher rank a year before they retire.

The Grand Jury found that firefighters were the most common offenders. Still true? Maybe it's time for an updated report.