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Court: NH can't raise vested workers' pension rate

posted Feb 2, 2012, 5:38 PM by Lise Tierney

Posted: Thursday, February 2, 2012 5:30 pm | Updated: 8:00 pm, Thu Feb 2, 2012.

Associated Press | 0 comments

A New Hampshire judge has ruled that recent pension reforms illegally raised contribution rates for workers vested in the state retirement system.

Superior Court Judge Richard McNamara's ruling gives a coalition of unions who sued on behalf of the workers and the state 30 days to appeal. The ruling signed Jan. 6 was released Wednesday in a lawsuit over pension changes lawmakers enacted in July that _ among other things _ raised workers' contribution rates.

McNamara said the law change was substantial "because it requires employees, who have already met the requisite service and age requirements, to pay additional amounts _ which may be an amount reserved for other expenses, like mortgage, housing, and food _ without receiving additional benefits."

McNamara dismissed the unions' arguments on other provisions in the pension reforms, including that the hike constituted a tax. McNamara said it was a fee. McNamara disagreed with the unions that workers' pension protections start when they become permanent employees. He said those protections start when the workers are vested at 10 years.

Senate Republican Leader Jeb Bradley of Wolfeboro said both sides are still digesting the ruling.

"We won on the important parts," he said. He said McNamara's ruling upheld the law changes that affect workers who aren't vested, including changes in work rules, years of service to full retirement and other changes in calculating benefits.

David Lang, president of the Professional Firefighters Association of New Hampshire, said the unions that sued _ including his _ are still discussing the decision weighing their options.

Under the law change, teachers, state and municipal workers began paying 7 percent instead of 5 percent last July. Firefighters' contributions rose from 9.3 percent to 11.8 percent. Police pay 11.55 percent, up from 2.3 percent.

Bradley said it isn't clear how much the change will cost if the state loses. The changes were estimated to bring in $100 million over the two-year budget, but McNamara's ruling would only mean returning money to vested employees.

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