Judge Says State Workers’ 4% Retirement Contribution is Unconstitutional

Sep 28, 2012

State workers would no longer have to fork out four-percent of their salaries to keep their pensions if a judge’s ruling stands.

An Ingham County Judge says the policy is effectively a pay cut, and only the Michigan Civil Service Commission can set state worker compensation.  Ray Holman is with the United Auto Workers Local 6000, the largest state employee union in Michigan.

“(Neither) The Legislature, nor the governor can cut our pay," Holman says.  "And that’s what had happened. And that’s why it feels really good to win in court today.”

In the late 1990's, the state switched new employees to a 401k plan. Holman say that means the ruling applies to fewer than half of the workers in his union. But that still amounts to several thousand people.

State officials will likely appeal the decision.