Infographic: The Protections for Massachusetts’s Public Pensions

Massachusetts 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 Massachusetts, state law may allow the Legislature to change employee benefit calculations. They have previously made changes in 2009 and 2011, but these were never challenged in court. It is unclear if this would be upheld if public workers challenged such changes.

In 1973, the Massachusetts Supreme Court found that increases to workers’ employee contributions, without an increase in benefits is prohibited, but may be allowed in limited circumstances. However, this has not been attempted.

What’s unclear is whether Massachusetts can shift workers’ vesting periods or retirement age, because this issue has not been brought to court and there is no existing law explicitly prohibiting this change.

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. 

Massachusetts Looking to Boost Essential Workers’ Retirement Plans

The Massachusetts legislature is considering a controversial bill that, if enacted, would provide three years of credit to public workers’ retirement plans upon retirement if they worked outside their homes during the height of the Covid-19 pandemic.

The merits of financially rewarding public workers for pandemic service are understandable, but this proposal may not actually accomplish that goal when all of the math is worked out.

Under the bill, eligible public workers would have three years added to their age or years of service when calculating their pension benefits.

Supporters of the bill say the pension credit is aimed at thanking essential workers who left their home from March 10-Dec. 31, 2020. The legislation is supported by numerous unions and the National Association of Government Employees.

But opponents say providing such credits would put a strain on the state’s finances. “There is zero analysis to see how much this would cost,” Geoff Beckwith, executive director of the Massachusetts Municipal Association, told WBUR News. “There is 100% certainty that this would be unaffordable.”

Whether or not the proposal is “affordable” is certainly a function of policy priorities within the current budget. But whether or not the proposal might undermine the finances of the retirement system is another matter.

States have a long history of using the expansion of retirement benefits as a way to raise compensation while spreading out the costs over time. Benefit enhancements can be priced and fully paid for at the time they are authorized—and a few states have laws that require this. But if the costs are not properly measured and paid for, there is always a danger that purportedly helping public employees with a benefit increase actually hurts them in the long-run by undermining the financial sustainability of their retirement system.

Once the costs of offering that reward through state pension systems are known, the legislature can weigh whether that is an appropriate use of future money or if it would be more prudent to pay workers using resources from today’s public resources.

But, at the same time, if the legislature is going to measure costs related to the pension system they should look at the quality of benefits being provided to workers under the status quo, too.

According to Equable’s Retirement Security Report, an interactive tool that evaluates the quality of state-sponsored retirement plans, only those who stay in the same retirement system for 20 or more years—known as Full-term Workers—are provided with adequate retirement income security under most plans offered by Massachusetts.

Those who stay in one retirement plan for less than 10 years, or between 10 and 20—known as Short-term and Medium-term workers, respectively—are generally not served well by their pensions.

Some plans don’t serve any workers well. The Massachusetts State Employees’ Retirement System Hazardous Duty pension plan, open to public safety employees, only scored a 22-out-of-30 for Full-Term workers, meaning it only serves them moderately well.

Providing these workers with additional pension credits is commendable in theory, but if those plans are already failing workers, then it somewhat defeats the purpose. Perhaps a better way to thank the tens of thousands who put their health at risk would be to restructure their retirement plan options so every worker—regardless of their career tenure—knows they’re on the path to retirement security.

Infographic: State Funded Ratio Histories

Funded Ratio History for U.S. Statewide Pension Funds

Download this infographic here.

These graphics originally appeared in the December Update to State of Pensions 2020. Read the report at

Individual state graphics are available for download here

Which States Have Laws that Allow for Police Pension Forfeiture?

If a police officer commits a crime in the course of performing their duties, they may be at risk of losing their pension. But only in certain states.

Most states have some kind of “pension forfeiture” laws on the books. These laws usually are related to public employees that are either convicted of, or plead no contest to, a felony or unlawful killing.[1] Only 23 of the state laws cover law enforcement employees, such as police officers.[2] There are three states that might cover police, depending on how they’re interpreted, and 24 states without laws covering police.

The details about what kind of crimes will lead to pension being stripped from a police officer vary from state to state. Usually the forfeiture law is limited to on-duty offenses, other times it is not. A few states allow for pension benefit reductions rather than taking the whole pension away. And the process for determining whether a pension is to be forfeited isn’t always the same: some states automatically strip pensions from individuals under these circumstances, other states have judges order the pension taken away or require pension boards to hold  proceeding to consider taking the right to a pension away.

For complete details, please review the relevant statutes in your state.

If you are interested in learning more about the benefits offered to public safety officers in your state, check out the Retirement Security Report.

Disclaimer: This article and infographic is not intended as legal advice or formal legal analysis. 



[1] There are seven states with pension forfeiture laws that do not apply to police officers, including: Delaware and Minnesota (laws only applies to surviving beneficiaries who commit an unlawful killing, not active members); Indiana and South Carolina (laws allows for pension benefits to be used as restitution for theft or embezzlement of public property, but does not otherwise require forfeiture for committing a crime); New Mexico and North Carolina (laws allow for pension forfeiture of elected official benefits only); New York (a 2018 law only allows pension forfeiture for elected officials, judges, and gubernatorial appointees)

[2] There are three states with laws that could be interpreted as covering police officers in addition to the 24 listed on the map above. Texas has a pension forfeiture law that only applies to the state Employees’ Retirement System, which does include some state police officers, but does not cover the vast majority of police around the state. Arkansas and Montana have laws that strip the pension of a public employee if they commit an unlawful killing, but only if the person they kill is another public employee.

Pension Fund Troubled as One in 5 MBTA Retirees is Under 50

More than one in every five MBTA pensioners retired before age 50 as the state increasingly has to pick up the tab on the T’s troubled pension fund that’s running big deficits even in the current strong market, a Herald analysis shows.

“It’s a few retirees who are being subsidized by the Massachusetts taxpayers,” said Mark Williams, a Boston University finance professor who tracks the MBTA Retirement Fund. “They’re eating two bites at the apple, plus they get to work at another job.”

That’s referring to the situation caused by the T’s longstanding “23-and-out” policy, which didn’t put a retirement age on its workers — it just required 23 years of service, at which point they could grab the pension, eventually become eligible for Social Security, and pick up another gig at the same time.

That’s what led to 22% of the 5,626 people receiving T pensions having cashed out under age 50, according to a review of MBTA Retirement Fund data. The average T pensioner is 55.8 years old.

The retirement fund has floundered deeper into fiscal danger, last year reporting $2.91 billion in liabilities versus $1.45 billion in assets. The fund said no new data is available about that breakdown at this point. It falls on the state to fill the annual shortfall, which resulted in the MBTA budgeting $118.2 million to keep the retirement fund afloat for the current fiscal year. That’s up from $102.9 million in fiscal year 2019 and $93.8 million the previous year. That’s now more than half of the total yearly payout, which is upward of $201 million, per the data.

Read the whole article in the Boston Herald.

This article quotes selections from “One in 5 MBTA pensioners is younger than 50 as fund struggles” by Sean Philip Cotter in the Boston Herald.

Pension Liability Payments Grab Big Share of Limited State Revenue

When Gov. Charlie Baker lifts the curtain on his fiscal 2021 budget this week, many Beacon Hill observers are going to flip right to the education section to see how great of an increase public schools might get under the new funding law. But there’s another spending area that will grow by an even greater percentage – the annual payment toward the state’s pension liability.

Baker’s budget office filed the new, three-year pension funding schedule Wednesday, detailing how Massachusetts will boost its annual pension payment by more than 9.6% each year – and by more than 30% over the three-year period – as it works to stash away money to cover the $41 billion unfunded portion of the state’s expected pension liability of more than $96 billion.

To remain on track to fully fund the liability by 2036, the state’s annual pension contribution will have to grow at a clip far more rapid than the growth forecast in state tax revenue.

The funding schedule doesn’t just limit some options for lawmakers as they craft the state’s annual budget, but it also impacts the approximately 314,637 retired or active state employees and municipal teachers who are part of the Massachusetts State Employees’ Retirement System or the Massachusetts Teachers’ Retirement System.

Read the whole article in the Milford Daily News.

This article quotes selections from “Pensions grab big share of limited revenue” by Colin A. Young in Milford Daily News.