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Our View: Clarity needed on pension law effects

Published: Thursday, May 8, 2014 11:07 p.m. CDT • Updated: Friday, May 9, 2014 8:46 a.m. CDT

The administrators, faculty and other employees at the state’s public universities could use some clarity about the future right now.

This is retirement season on campuses around the state, but with the number of retirement parties that could be ion the way at Northern Illinois University, they might want to consider renting the Convocation Center.

The impetus for the departures is language in the state’s pension reform law. The law, which was passed in December and challenged in court in January, leaves some public university employees facing a scenario where they risk reducing their pension benefits if they continue to work past June of this year.

After a University of Illinois Board of Trustees meeting in April, NIU President Douglas Baker floated the possibility that as many as 800 NIU employees – 20 percent of the workforce – could elect to retire by the end of June.

That’s an alarming projection, but it seems like a worst-case scenario. Recent news and retirement filing data suggest that the problem might not be as severe as once thought.

According to data from the State University Retirement System, there have been 111 retirement applications filed so far by NIU employees for May or June of this year. There were 33 retirements at the end of the spring semester in 2013.

There could be many more retirements this year. Although employees typically are required to give 60 days’ notice before they retire, this year, the retirement system has set May 31 as the deadline to file for retirement by July 1. And workers communicate their plans to the retirement system, not directly to NIU.

That leaves NIU officials with only 2½ months to determine how many jobs will be vacant and which ones they need to fill before the start of the fall semester in August.

Meanwhile, the legal language that could penalize employees who want to continue working might not be a problem after all. Retirement system Executive Director William Mabe told the Champaign News-Gazette this week that the law should not be interpreted as saying it would cost retirees a year of pension because that wasn’t its intent. 

In support, retirement system officials point to a 1986 Illinois Supreme Court case, which held that interpretations of vague legal language must always be interpreted in favor of pensioners.

So maybe all of these supposed forced retirements aren’t really necessary after all. Or maybe people will look at it and say, why gamble with the future?

Although it might pose some opportunities for change and new ideas, and make budget reductions easier, a major staff exodus at NIU could also adversely affect students and those employees who remain.

If pension authorities are changing their minds on how to interpret the new law, they need to make a decision and notify the people affected, including university officials.

Choosing to end a career is not an easy decision. Those considering whether to depart – and those who will take over for them after they go – deserve to have accurate information.

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