LANSING (WTVB) - Republicans in Lansing have pushed through reforms to public schools retirement plans that unions are calling a continuation of the state’s war on teachers. If the governor signs it, teachers and other school employees will be required to contribute 7% of their salaries to their pensions and 20% of their salaries to healthcare, up from 10%. It’s even more expensive for new hires.
While Republican lawmakers like State Senator Bruce Caswell say the reforms will keep the system solvent, teacher’s unions says it breaks promises to the 450,000 state school employees who will not be receiving the benefits they have worked for their entire careers. Both the House and Senate voted for the plant, with most Democrats voting against it. Governor Rick Snyder says he will sign the reform package.
The Senate dropped its initial plan to move all new employees to a defined contribution retirement benefit and end the current hybrid plan that provides some pension and some defined contribution benefit. Instead, the bill calls for that issue to be studied. State Senator John Proos says he doubts that the political will to implement the 401-K idea will be there in 90 days when that study period is over.