Illinois’ teachers’, public safety officers’, and public workers’ pension benefits are entitled to certain protections under state law and affirmed by court rulings. At the same time, the state does have some legal precedent that allows them to change particular aspects of retirement benefits.
In other words, there are parts of public pension benefits that can be changed by future state laws, but only certain parts of those benefits.
Equable Institute partnered with Columbia Law School’s Center for Public Research and Leadership to create infographics that map states’ pension governance. Understanding the legal environment for pension policies can be confusing for both lawmakers and public workers, but illuminating legally permissible policy pathways to improve funding sustainability and ensure adequate retirement income security for states’ workforces is essential.
In the case of Illinois, the state Legislature cannot decrease or eliminate cost-of-living adjustments or change benefit calculations for workers. Lawmakers had attempted to do this in 2013 for members of the Judges’ Retirement System of Illinois (JRS), Illinois Municipal Retirement Fund (MRF), Illinois State Employees’ Retirement System (SERS), the Illinois State Teachers’ Retirement System (TRS).
The Illinois Supreme Court struck down the law, ruling that the state had illegally tried to change workers’ Constitutionally-protected benefits. This means these aspects of public workers’ pensions can’t be changed in the future thanks to the legal precedent set by the court.
What’s unclear, though, is whether Illinois can legally increase employee contributions or change workers’ vesting periods. A 2010 Illinois law touched on these issues, but there have been no legal challenges against them.
It is important to note that current retirees’ benefits have greater legal protection than those of active employees. Apart from reduced or eliminated COLAs, current retirees’ benefits cannot be taken away or reduced.
Disclaimer: The information here doesn’t constitute legal advice or representation. Equable is not necessarily recommending any of the policies discussed in the infographic. Some may not work for certain states, others may not be desirable policy. Ultimately, any pension policy change should honor promises made to public workers and put them on a path to retirement security, while ensuring sustainable funding measures.