Overtime Not Eligible For Pension Payments
Monday, November 2, 2009
San Diego’s city attorney, Jan Goldsmith, said the city has defeated one of several lawsuits seeking higher pension payments for employees.
Superior Court Judge Judith Hayes ruled members of the fire department could not count regular overtime as part of their salaries for pension purposes.
Goldsmith said the ruling spares the city from potentially heavy pension cost increases in future years.
"If it had come out the other way it would have opened up claims from past, present and future employees that overtime was included within pension compensation," Goldsmith said." So conservatively, it would have been an exposure of tens of millions of dollars."
Goldsmith said even though paramedics and some other city employees have to work overtime on a regular basis to get the job done, the city’s municipal code is clear that overtime is not part of the regular salary on which pensions are based.
He said several suits remain to be resolved which could cost the city hundreds of millions of dollars in increased pensions.