STATE – The New Jersey Education Association has joined with other unions representing the state’s public employees to file a federal lawsuit against the pension and benefit overhaul plan Gov. Chris Christie signed into law in June.
The suit alleges that the state has illegally taken away promised and earned contractual benefits by eliminating the Cost of Living Adjustment (COLA) that is part of the pension formula for most New Jersey public employees.
“This lawsuit is about basic fairness and justice. Governor Christie and the Legislature passed a law which illegally takes away benefits that school employees and others have already earned through their service to the people of New Jersey,” said NJEA president Barbara Keshishian.
The lawsuit also challenges other aspects of the law, noting that provisions requiring future retirees to pay a substantial percentage of their health insurance premiums and requiring substantially larger pension contributions from employees also violate the state and federal contract rights of the affected employees.
The final element of the suit concerns the state’s choice to make the unfunded liability of the pension systems substantially worse by phasing in its contributions over seven years rather than paying its full actuarially required contribution immediately.
“We would have preferred not to have to contest this issue in the courts,” Keshishian said. “These issues should have been discussed and dealt with collaboratively, with all parties at the table and all options under consideration. Unfortunately, politics triumphed over pragmatism, and New Jersey was presented with an illegal, indefensible, and false solution to a very real problem.”
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