New York Pension Watch: Public Employee Unions Ask for Pension Sweeteners!

Asking for full retirement age possibility of 55... yeah, that's a big ask

Here’s the situation:

• New York State has somewhat managed its public pension situation, unlike states like Illinois and New Jersey, by greatly reducing its promises to new entrants

• Obviously, the (relatively) new entrants are not happy about having lower promises … and they think they may be able to get vulnerable politicians to agree to retroactively boost their benefits … because once boosted, they will not be able to be unboosted

• So they took a field trip to Albany last weekend to yell THAT’S NOT FAAAAAIR

That’s the extremely short version.

I am not being totally snide when later public employees see prior groups chowing down on the public pension high fructose corn syrup, wanting in on the public finance diabetes action, shouting THAT’S NOT FAIR, and saying: oh, you want to die from diabetes, too?

Okay, perhaps that’s pushing the metaphor too far.

So let’s look at the longer version.

News Coverage and Union Press Releases

Let me get the “not my opinions” stuff out of the way first.

9 Mar 2026, ABC News 10: More than 15,000 gather in Albany in support of changes to Tier 6

More than 15,000 New York state workers rallied at MVP Arena on Sunday, calling on lawmakers to change Tier 6, the pension system for new employees hired after 2012. News10’s Amber Fisher was at the rally and spoke with teachers, firefighters, and other state workers about why they believe Tier 6 isn’t fair.

Rob Roszkowski, Paraprofessional with the United Federation of Teachers, is one of thousands of public workers that was calling for changes to Tier 6. “As you can see, we are here to transform Tier 6 into something that is livable,” Roszkowski continued. “Right now, a paraprofessional– that’s a student aid – that’s still fully coming into the schools, wouldn’t be able to retire until 2071. They have to retire when they’re 63. That’s insane. It’s a job that when you’re 55, that’s a good time to retire.”

The system requires most employees hired after 2012 to contribute more of their paycheck and wait longer to retire. Donna DiPalo, Vice President of the Levittown United Teachers, explained her frustrations, saying, “Teaching is a really, really tough career. And to do it for 40 years is extremely challenging. So it’s, you know, a 30 year career is a fair career for teachers. We work really hard.”

Teachers, paraprofessionals, nurses, firefighters, police, as well as other state and local workers all fall into Tier 6. Tier 6 workers must work until age 63 and have up to 40 years of service in order to retire, where as Tier 4 workers only need to work until age 55 with 30 years of service.

8 Mar 2026, Spectrum News: Gov. Hochul, union leaders rally in support of changes to Tier 6 of public pension plan

Gov. Kathy Hochul on Sunday joined union teachers, nurses, firefighters and public employees statewide, demanding a fix to the New York State and Local Retirement System.

Elected officials at the state and local levels gathered with union members at a rally in Albany on Sunday, calling for changes to Tier 6 of the public pension plan.

They say about 780,000 workers statewide are classified as part of that group, enacted in 2012 to reduce long-term pension costs to the state.

Union members claim Tier 6 requires them to work longer and contribute more from their paychecks while receiving reduced benefits compared to previous plans.

The governor says she’s in support of a more equitable plan after making previous changes to Tier 6 in 2022.

“Instead of taking the average of five years, we’re taking the average of your three consecutive years.,” Hochul said. “We’re taking a shorter vesting period from 10 years down to five. And also, I’m fighting for a fairer pension plan because it’s essential that we continue recruiting people.”

It’s not “fairer”, but I will address that in a bit.

Here are the unions’ press releases:

10 Mar 2026, NYSUT: NYSUT brings together 15,000 unionists for historic Fix Tier 6 rally

Thousands of educators, firefighters, nurses, law enforcement, and public workers from across the state gathered at MVP Arena Sunday for the sold-out Statewide Fix Tier 6 Rally, raising their voices in unison to demand a just, equitable retirement.

The event brought together 15,000 members from NYSUT, NYS AFL-CIO, Civil Service Employees Association, Public Employees Federation, New York State Nurses Association and the New York State Professional Fire Fighters Association, and others who called on state lawmakers to lower retirement ages and reduce penalties, so that educators and other civil servants can retire with the dignity they deserve.

….

Currently 780,000 public workers are enrolled in Tier 6, which requires employees to work longer, contribute more, and receive fewer benefits than workers in earlier pension tiers.

….

Sepulveda, who is a member of Tier 6, said she also appreciated the support of Tier 4 members and retirees. “I know that Tier 4 also had issues and tiers 1, 2, and 3 stood up to help Tier 4 get better, so I’m really grateful that there are Tier 4 members out today to help us fix our tier so we can also retire and feel confident in that,” Sepulveda said.

“Tier 6 is going to make it so people don’t want to do public service anymore,” said Lisa McDonnell, a member of Middle Country TA. McDonnell said solidarity is essential to getting pension reform. “I know when I started, Tier 4 looked very different, and people worked for me to have a better Tier 4, and I want to do the same thing for Tier 6,” she said.

8 Mar 2026, UFT: Massive Sunday labor rally for pension reform

New York’s labor movement came together on an extraordinary scale Sunday, March 8, to demand pension reforms at a rally at the MVP Arena in Albany.

More than 10,000 union members from the NYS AFL-CIO, New York State United Teachers, United Federation of Teachers, NYS Public Employees Federation, NYS Professional Fire Fighters Association, New York State Nurses Association, and Civil Service Employees Association sent a clear message to state lawmakers: Fix Tier 6 now and restore fairness to the state’s pension system.

….

Roughly 780,000 New Yorkers are stuck in the state pension’s Tier 6, forcing them to work longer, contribute more out of every paycheck, and receive dramatically reduced retirement benefits compared to their colleagues in earlier tiers.

The blatant pension inequity is fueling workforce shortages across education, public safety, healthcare, and other essential services by driving young, talented professionals away from public service careers and pushing experienced workers out.

Useful Info on Tier 6 — from one of the Unions

13 Feb 2026, UFT: Fixing Tier 6

What is Tier 6?

Tier 6 is the pension tier that covers most New York State and city public employees hired on or after April 1, 2012. While Tier 6 provides a financially secure retirement, it is not as beneficial as previous tiers. Tier 6 sets a later retirement age — 63 as opposed to 55 after 30 years of service — requires higher employee contributions, and calculates pensions in ways that can reduce retirement benefits despite completing a full career of public service.

Why is the UFT working to Fix Tier 6?

Tier 6 is fundamentally unfair and out of step with the realities of public education. Tier 6 asks educators to pay more and work longer for the same retirement benefits enjoyed by their colleagues doing the same jobs under earlier tiers. Tier 6 also disproportionately affects younger workers, women and educators of color, who were more likely to have been hired after 2012 and to experience career interruptions. These gaps undermine morale, worsen recruitment and retention, and threaten the stability of our profession. Our students lose when educators don’t stay in our profession. We deserve the same retirement security previous generations fought for and won.

What is a pension tier?

A pension tier sets regulations on how your pension is calculated, such as how much you contribute and when you can retire as a New York State or city employee. Your tier is based mainly on when you were hired. There are separate, distinct tiers affecting New York City educators depending on when they joined the retirement system, with earlier tiers offering more generous pension benefits.

What are the different state pension tiers?

The existing pension tiers for New York City educators with qualifying appointment dates are listed below:

• Tier 1: individuals who joined the Teachers’ Retirement System (TRS) before July 1, 1973.

• Tier 2: individuals who joined TRS after June 30, 1973, and before July 27, 1976.

• Tier 3: individuals who joined after July 26, 1976, and before Sept. 1, 1983. All Tier 3 members are eligible to retire under Tier 4.

• Tier 4 (age 62): individuals who joined after Aug. 31, 1983, but prior to Feb. 28, 2008. Members in this tier can also retire at age 55, with 30 years of service, without a reduction. These members also had a one-time option to join the Tier 4 55/25 plan, which increased employee contributions but allowed for an earlier retirement date.

• Tier 4 (55/27): individuals who joined after Feb. 28, 2008, but prior to April 1, 2012.

• Tier 6: individuals who joined the retirement system after March 31, 2012.

I added the emphasis re: “Tier 6 asks educators to pay more and work longer for the same retirement benefits enjoyed by their colleagues doing the same jobs under earlier tiers.”

Before I answer my own question, I want you to think about something:

How long do you think the average current teacher would have in retirement if they retired at age 55?

And what do you think that would be like 50 years earlier?

Also, if that average retirement length is longer than the years of service, what do you think happens with the pension costs?

Sideline: Vesting Periods

There are aspects they’ve already changed on Tier 6 (from the same post):

How has Tier 6 already been improved?

Thanks to our advocacy, Tier 6 has already been improved by:

• Changing the final average salary (FAS) calculation to match Tier 4, resulting in a higher pension benefit upon retirement. Previously, the FAS for Tier 6 was an average of the five highest-paid consecutive years of employment. Tier 6 members will now be able to calculate their final average salary using just the three highest-paid consecutive years, which will result in a higher pension calculation.

• Dropping the pension vesting period from 10 to five years to match Tier 4. This means Tier 6 members are now eligible to receive a pension five years earlier.

The first change increased the benefits paid. I’m not going to look at how much right now. Mainly because that analysis is not yet available.

The second item also increases the costs, because more people are vested in the pension, but this one I don’t mind at all.

One of the worst abuses in public pensions against the public employees themselves is how many walk away from their jobs with absolutely nothing because of the long vesting periods. They’re not covered by ERISA, and this can screw them over for the years of no retirement savings.

Some background reading on this, if you’re interested:

Nov 2012, Center for Retirement Research: The Impact of Long Vesting Periods on State and Local Workers

Sept 2018, The 74: Aldeman: Teachers Need to Build a Nest Egg. Schools Need Teachers to Stay on the Job. Changing Rules on Vesting in Pensions Can Help Both

2021, Social Security Bulletin: Vesting Requirements and Key Benefit-Formula Features of State and Local Government Pension Plans

I think the shorter vesting period is a good change.

Interlude: Some Twitter Commentary

No, It’s Not Fair — But We Can’t Cut Earlier Tiers….

So here’s the deal.

Whining IT’S NOT FAIR, THEY’VE GOT MORE reminds me of my young childhood when so many other kids (who were spoiled) didn’t have to go to the thrift shops to get all sorts of things.

Well, we didn’t have the money of. (This was a family saying that we got from one of my sisters, indicating not enough money to fulfill all our material desires.)

And, for many of those other kids… their parents also didn’t have the money of….but my parents were more prudent. I learned some good things about avoiding lots of debt via my parents.

This is to say: It never occurred to the Tier 6 folks that no, the Tier 4 folks ALSO shouldn’t be retiring at age 55.

Because age 55 is a ridiculously low age to be retiring at…. ESPECIALLY for teachers.

Alas, once the “right” has been given, the ratchet goes only one way, and can’t be taken back for public pensions (okay, it can, but I don’t want to deal with it in this post. That’s not an option on the table currently, politically, in New York.)

So, you may have noticed money has been tight, my fellow New Yorkers.

Let me show you why retiring at age 55 for teachers in NY is ridiculous, and we can move on from there.

55 is an absurdly low retirement age

When I say “absurdly low”, I mean: if you’re not physically disabled/have a terminal illness, etc.

There are ways to retire so young as an individual if one saves a lot of money, but this is about setting a normal, full retirement age for a public pension plan.

Because yes, let’s go to the data for public employees!

The Society of Actuaries got experience data for public pensions in the U.S. and developed pension valuation tables that were separate for public plans (because the ones for private plans are very different).

In January 2019, there was a full report: Pub-2010 Public Retirement Plans Mortality Tables Report, which were based on real experience, and developed base tables … (alas, the pandemic came right after this, and all of us dealing with mortality have had to think about how we project mortality, whether it’s for life insurance, annuities, pensions, Social Security, etc.)

For the report, they had three public employee types:

• Teachers

• Safety officers (cops & firefighters)

• General (everybody else, but primarily office workers, bureaucrats & politicians)

At the end of the report, they show the cohort life expectancies from different ages (equivalent to expected retirement length, if you retired at those ages).

Here’s one of the tables, with the highlighted numbers for retiring at age 55 with the new results:

That is, from the year 2018, the expected retirement length at age 55:

• Female teachers: 35.1 years

• Male teachers: 32.6 years

The columns to the left show the results from other standard assumption sets, from non-differentiated experience (not splitting out public pensions).

Safety officers from age 55:

• Female: 32.6 years

• Male: 30.0 years

General public employees from age 55:

• Female: 33.4 years

• Male: 30.0 years

And for a very blunt comparison, because this is the general U.S. population, which includes everybody, Social Security life tables, using cohort from 1970, age 55:

• Female: 30.8 years

• Male: 27.5 years

Even for the general public, people are expected to live at least about 30 years from age 55.

How much money do you think you need at age 55 to support you for a longer time than you worked?

What’s not fair is that yes, some people are retiring far too young. Unfortunately, we can’t do anything about the earlier tier 4 being able to retire at age 55. Oh well.

But let’s not make things even more unfair by setting absurdly low retirement ages for modern people.

100 years ago, retiring at 55 may have made sense … it makes little sense now.