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AEA Lawsuit Victory: Legislative Retirement Contribution Grab Illegal

On February 3, the Arizona Superior Court ruled in favor of teachers, education support employees and other members of the Arizona State Retirement System, reversing legislation that reduced your salary by hundreds of dollars and diverted the funds to the state’s budget. The increased employee retirement contribution forced on you by the legislature will be returned unless the state files a legal appeal. The AEA filed this lawsuit on behalf of our members.

Anticipating AEA’s legal victory, the Arizona House of Representatives began moving House Bill 2264 which passed its first committee hearing last week with a unanimous vote.  This bill returns the retirement contribution rates back to an equal 50-50 split between the state and its workers. It also requires the state to refund to public employees any contributions made this year in excess of 50 percent. Read more here.

In the waning hours of last year’s legislative session, Governor Jan Brewer, former Senate President Russell Pearce, and former Speaker of the House Kirk Adams crafted a deal that reduced your take-home pay by increasing the percentage of employee paid contributions to the retirement system. Rather than a 50% employer and 50% employee contribution split, your contribution rose to 53% and the employer rate was reduced to 47%. The legislation did not allow school districts to have access to the savings; instead the legislature kept it.

The Arizona Constitution, based on an amendment AEA helped pass in the 1990s, protects your retirement benefits from legislative raids. This constitutional provision, through AEA’s lawsuit, protected you from this attempt to decrease your retirement benefits by increasing your contribution rate.

In these tough economic times, this victory demonstrates the importance of AEA membership. By standing together educators had the foresight and power to pass a constitutional provision over a decade ago and enforce it in court this year. Without our collective strength and legal expertise, the legislature might continue to raise our retirement contributions.  Be sure to tell your colleagues about this victory.  If they are not a member, ask them to join.  Standing together, we are stronger.

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