IAFF LEGISLATIVE FACT SHEET

SOCIAL SECURITY ISSUES

The IAFF opposes mandatory Social Security coverage for non-participating public sector employees and supports repeal or reform of the Windfall Elimination Provision (WEP) and the Government Pension Offset (GPO), so long as repeal would not result in mandatory Social Security coverage for fire fighters.

BACKGROUND

When the Social Security system was created in 1935, government employees were expressly excluded. Even when state and local governments were given the option to join the system in the 1950s, many fire departments were still legally barred from electing Social Security coverage until 1994. Because of this long exclusion from the Social Security system, local governments created pension systems for fire fighters to address their retirement needs without Social Security. An estimated 75 percent of all fire fighters are covered by pension plans that are independent of Social Security. These comprehensive plans are tailored to meet the unique needs of fire fighters by taking into consideration the early retirement ages and high rates of disability retirement that are characteristic of public safety occupations.

Fire fighters who do not pay Social Security payroll taxes, but who qualify for Social Security benefits by paying into the program at a second job or through a spousal benefit, may see their benefits reduced by two offsets, the Government Pension Offset (GPO) and the Windfall Elimination Provision (WEP). The GPO reduces public employees' Social Security spousal or survivor benefits by two-thirds of their public pension while the WEP reduces the Social Security benefits of an individual who also receives a public pension from a job not covered by Social Security. These offsets deny fire fighters benefits to which they are entitled.

Many proposals have been put forward in Congress in past years to mandate Social Security coverage of all public employees, including fire fighters. Other bills, some of which have generated broad support, have sought to repeal or reform the GPO and WEP.

In recent years, the two issues have become linked. Some policy makers have argued that the simplest way to eliminate the offsets is to require everyone to pay into Social Security. Moreover, proponents of linking the issues note that repealing the offsets would cost tens of billions of dollars, and that the fairest way to pay for any repeal or reform would be to collect Social Security taxes from those municipal employees not currently covered.

The IAFF has long opposed mandatory Social Security coverage as an attack on fire fighter retirement security, and has also supported efforts to repeal or reform the WEP and GPO. To address the potential linkage of the two issues, delegates to the IAFF’s 2004 convention modified the organization’s position to affirm that the IAFF supports repeal or reform of the GPO/WEP “provided it does not increase the likelihood of forcing all fire fighters into mandatory Social Security coverage.”

CURRENT LEGISLATION

Several bills have been introduced to repeal or reform the WEP and GPO, including H.R. 82, H.R. 726 and S. 206.  Congress may also consider legislation establishing a bipartisan commission to recommend broad reform of the Social Security system.  Such a broad reform proposal may address the issues of mandatory coverage and the two offsets. 
 

CONGRESSIONAL ACTION

The IAFF continues to work with congressional leaders to both preserve independent retirement systems outside of the Social Security system and to lessen the impact of the GPO and WEP offsets on fire fighters who qualify for Social Security benefits.