County officials say they will take a recent federal court ruling on contribution rates charged by the pension system “all the way to the Supreme Court.”
The vow to appeal the ruling comes less than a day after the U.S. Equal Employment Opportunities Commission announced a federal judge had declared that the county’s pension contribution rates are discriminatory.
“We’re going to fight this until there is no one else to fight,” said Don Mohler, a county spokesman.
Mohler said the Oct. 17 decision by U.S. District Court Judge Benson Everett Legg could have dire consequences for more than 6,000 employees.
“If this judge is allowed to prevail, and we don’t think he will, we’ll have to go back to more than 6,000 employees and arbitrarily raise the contribution rates and take money out of their pockets,” Mohler said.
The ruling wouldn’t just change the contribution rates for employees moving forward. Employees would also be required to pay additional money into the system to cover the difference between the contributions made since the change was instituted in July 2007.
The changes were part of an overhaul designed to protect the financial health of the nearly $2 billion Baltimore County Employees Retirement System.
Employees hired after that date contributed to their pensions at a flat rate regardless of their age at the time of their hiring. Employees hired before that date paid into the system at a rate based on their age.
“Two employees with the same number of years until retirement eligibility—that is, the same pension status—do not necessarily contribute at the same rate,” Legg wrote in his 10-page ruling. “Pension status, therefore, cannot be the driving factor behind the disparate treatment, which is directly linked to an employee’s age. As such, because age is the ‘but-for’ cause of the disparate treatment, the ERS violates the [Age Discrimination in Employment Act].”
“Millions and millions of dollars would have to be repaid,” said Mohler.
Mohler said the county believes the ruling is “part of a pattern.”
“There is a drumbeat to have public employees move away from traditional retirement plans and into 401Ks,” said Mohler.
“We believe we have an obligation to provide benefits to our employees that are sustainable,” said Mohler.
“Everything we do is designed to protect employees and protect the [retirement] system,” said Mohler.