AMAC In The Media / Opinion / Politics / Press Releases

AMAC Backs Reform of the Social Security WEP Clause that Penalizes Private Sector Workers

WEPWASHINGTON, DC, July 24 — AMAC Action is calling for reform of the Windfall Elimination Provision [WEP].  “It does a disservice to public service employees who paid into the Social Security fund when they took up a second private sector career or who needed to take a second job by shortchanging them when they retire,” says Bob Carlstrom, president of the advocacy affiliate of the 2.1 million-member Association of Mature American Citizens {AMAC].

Carlstrom and AMAC are putting their support behind legislation the Equal Treatment of Public Servants Act to remedy what he calls “the unfair” impact that WEP has on those who chose public service as a primary career.

“WEP reduces Social Security benefits for a worker who receives a public pension.  This is problematic for public service employees that work another job on the side, or for individuals who want to transition into a public service profession such as teaching.  Both would receive reduced benefits even though they have already contributed money into the system.  Educators, police officers, and firefighters should not be in the position for weaker benefits after they have already contributed to the Social Security fund for many years.”

According the AMAC Foundation’s Social Security advisor, Russell Gloor, “It’s not unusual for individuals who work in the private sector to transition into second, public sector careers.  It is also commonplace for those working in the public sector to make ends meet by moonlighting in second, private-sector jobs.  Either way they wind up making contributions into the Social Security pool.  But many of them wind up having their Social Security benefits severely reduced because of the WEP clause.  Current estimates are that nearly two million American workers are impacted by the Windfall Elimination Provision and it can have a particularly onerous bearing on police officers, firefighters and teachers.“

The Bipartisan Policy Center has also thrown its support behind WEP reform.  As that influential think tank put it: “Many state and local government workers are not covered by Social Security, meaning that employees and their employers do not contribute payroll taxes on their earnings from those positions. Yet many of these workers also work part of their careers (or work part-time) in covered employment and will still be eligible for Social Security benefits. The WEP was originally designed to prevent these individuals from receiving unintentionally large Social Security benefits, but its methodology is overly complex and does not allocate benefits equitably.”

AMAC’s Gloor says it is understandable that workers who transitioned from a private sector job to public sector, Social Security-covered employment view WEP as unfair.  “Even with 20 years of earnings from which Social Security taxes have been paid, their benefit can be reduced by as much as half simply because they had another career during which they didn’t contribute to Social Security.  Similarly, civil servants who moonlighted at a second job during their careers in order to get by and paid into the Social Security fund can get shortchanged.  Nevertheless, WEP still applies today, amid the cries of unfairness by nearly two million affected Americans.  Though several bills have, in recent years, been introduced to either repeal or reform the WEP provision, none have made it past being “referred to committee” in Congress.   According to those who are most hurt by WEP, it’s time for Congress to stop penalizing our nation’s public servants and enact WEP reform.”

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George Mason
1 year ago

My wife worked in the public sector paying into SS. After having our daughter she went back to school and became a teacher. Her retirement as a teacher because of her late start was reduced by her years of service 20 verses 25/30. However, because of WEP her retire is cut. When she reached Medicare age of 65 they took was was left and now send her a bill for the remaining coverage which is large because of my retirement earnings. We are being kicked while we are down!!!

George Mason
1 year ago

This is a horrible tax. Why has it not yet been repealed!!!

margaret potter
1 year ago

I worked over 27 years as a civil service employee and I paid into Social Security during this time. Yes, there were job classifications that did not pay into SS, and yes these employees did obtain private sector employment to earn “credit” to be eligible for SS at retirement. So what is the problem? The “filthy rich” people worked for their business / financial success and they too are eligible for SS, so why can not the “middle” class be eligible of SS benefits?

rick cramer
1 year ago

My wife worked in private sector at low wage levels most of her life, largely helping to get our kids through Christian school. Later on she worked at library for much better income but as a governmental organization they did not participate in social security. After just 8 years of service there we retired and she is getting a small pension. Right now social security takes a third of her pension under this provision. If I die first and she receives my social security under surviving spouse, they will take away 90% of her pension leaving her very close to destitute. The provision is a travesty for someone in her situation.

Carol
1 year ago

My husband worked for almost 20 yrs in private sector before and after working for federal government for 25 years. He would get his annual SS statement as to how much he would get when he retired. What a joke. When he did start collecting SS they took almost half of what he should have received due to WEP . We have friends who collected full SS and receive an additional pension from a company like GE with no penalty. They were shocked when we told them about our situation. I even went to our Congressman many years ago who said he couldn’t support the bill to repeal it since it was double dipping and his SS constituents would be angry!

G Schalk
1 year ago

Just have all workers contribute only to social security and 401k’s. Repeal IRS code 501(c)(5)

Sharon
1 year ago

If one pays into Social Security, that person’s benefit should be appropriate to what they contributed. In IL the state is going broke due to government employees getting pension amounts that far exceed their contributions.

Marlene F Nickerson
1 year ago

I RETIRED ON DEC 31, 2012. I WORKED 38 1/2 YEARS CIVIL SERVICE. THE FIRST 13 YEARS I WAS UNDER THE OLD RETIREMENT SYSTEM AND PAID INTO THAT. IN 1987 THEY CHANGED THE RETIREMENT SYSTEM TO FERS (SOCIAL SECURITY). I WAS PAYING INTO BOTH THE OLD RETIREMENT SYSTEM AND FERS(SS) FOR THE NEXT 25 1/2 YEARS. PLUS THE FACT THAT I ALSO HAD PART-TIME JOBS IN THE PRIVATE SECTOR AND PAID SS DUES THRU THEM. WHEN I RETIRED THE GOVERNMENT CHARGED ME A PENALTY OF OVER A THOUSAND DOLLARS A MONTH, THAT THEY TOOK FROM MY CIVIL SERVICE RETIREMENT, DUE TO THE WEP LAW. I PROTESTED BUT IT FELL ON DEAF EARS AS USUAL. THAT AMOUNTS TO $91,000 AS OF THIS MONTH (07/01/2020) I AM A WIDOW AND THE EXTRA 1000 + A MONTH WOULD BE VERY WELCOME. I PRAY THAT THIS LAW WILL BE OVERTURNED. I DO RECEIVE A SS CHECK EACH MONTH. THANK YOU AMAC

shed469
1 year ago

A starting point is a needs test. When all retirement income is barely above the official poverty level, how can the word “windfall” be applied to your situation? It is plainly a penalty for daring to make a living where Social Security taxes are not collected. In my case, I asked they be withheld but the college where I worked refused. Whatever sense could have been made when this odious law was enacted has become a severe penalty for those who can least afford it. Those with large Social Security checks, in some cases their contributions were limited by high income and meeting the maximum contribution, along with high paid public jobs, they will still be well fed in retirement after WEP is applied. The truth is, that trying to change the WEP, since the early 1980’s, has failed because the members of Congress, good examples of what I just described, have no interest in fixing or killing the WEP law until they are exempted along with the poorest of Social Security retirees. Awhile back, my congressman was kind enough to listen to me about WEP in a 10-15 minute cell call. He thought everyone should get the retirement they paid into and were entitled to receive. In part, he meant that WEP should not penalize him either. Therefore, practically speaking, reform is a dead horse. Killing WEP for everyone, particularly our selfish public servants in Congress, is the best hope for ending this discriminatory WEP law.

Sue
1 year ago

It’s truly sad to of watched my husband work his whole life. Paid into social security. Now to only receive half payment in return. The first year of his retirement diagnosed with dementia. The full payment sure would help with his care. Plus he earned it !!!!!!

shed469
1 year ago

 

wolverine70
1 year ago

WEP already has a phase out for workers with 20 years or more of significant earnings. These people who spent their primary earnings years not paying into Social Security shouldn’t get a windfall. Reform for widows/widowers might be worthy of consideration.

Harry
1 year ago
Reply to  wolverine70

What “windfall”? I paid into SS for over 20 years. My SS benefit should be based on that income alone, since not one penny of my public sector income is counted. Don’t cut the benefit that is based on only the income from private sector jobs!

Sharon
1 year ago

I should have said I got a 60% reduction in the SS benefits I received.

Sharon
1 year ago

I worked in business for 20 years then became a teacher. When I retired, I got a 60% in the soial security I should have
received. Not fair as I paid into the program for all those years. With what they take out for Medicare, that leaves me $280/month of ss.

Butch
1 year ago

I taught high school for 36 years and had a side job for every quarter for all 36 years. Then have worked 17 years in a nonprofit job. My Social Security benefits are half of my wife’s who worked in private teaching jobs. According to my SS statements I should have 3 times the income I have now.

James Turpin
1 year ago

I retired in 1998 MWD Southern CA. I worked there for 11 years under CalPers public servant. Started in 1965 in private sector union until 1987. Upon retirement SS debucted 40% from my SS after paying in for 27 years. I’m glad someone is finally looking into this RIP off. I still pay for Medicare out of my SS + taxes again RIP off. Thank you!

Leslie McPeck
1 year ago

Thanks for supporting reform. This needs to be fixed.

Jeff
1 year ago

Public sector employees should all be required to contribute to Social Security. Any other pension saving should be through a 401k plan from their salary. No taxpayer money should be used to give these public sector employees any extra money in retirement.

Lill
1 year ago
Reply to  Jeff

I worked private sector for almost 20 years and public for the last 17. Because the salaries for employees were so low in our rural county, the employees voted years before not to have social security taken out of their checks. I didn’t hear about the WEP until after I started there, so that at retirement my social security pension was reduced by 60%. Because of that, I receive less than $500 per month. I have friends who were teachers that get $100-200 per month after having Medicare taken out due to the WEP. It’s unfair to those who worked hard all their lives and I support AMAC in their efforts to change this.

margaret potter
1 year ago
Reply to  Jeff

Jeff – Sorry to read your disguise viewpoint toward public sector employees. I worked numerous years in the public sector. The union always agreed to smaller pay benefits with reassurance of a good pension. The state’s last governor (republican) did not live up to the agreed benefits between the state and union and we received a cut in pension. It does not matter if it is a republican in office or a democrat neither one of them know the word integrity.

REBECCA G
1 year ago

I worked in public service for 39 years. The first 25 years I paid into SSA. After that our union opted us out of paying into SSA.AA When I retired I was penalized and my SSA benefits reduced due to WEP. So, what can we, the public, do -other than pleading to our congress folk & senators -to move this along since its been brought up and laid to rest so many times.?

DBM
1 year ago

Don’t public service workers, like congressmen and senators, get large retirement packages that dwarf social security? I thought that was one of the motivating factors in the WEP clause.

Vicky Kramer
1 year ago
Reply to  DBM

Yes, that was the motivating factor, because so many were going from one agency to the next and would receive large retirement payments and that is why so many little people are caught in this trap.

rick cramer
1 year ago
Reply to  DBM

Sometimes. It was created to prevent double dipping. My wife’s problem under the provision is she worked for a relatively short time in public sector and the rest of her career was for lower wages. There is no provision to help those at lower income levels.

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