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Sterling Employment Law

Are employee rights being violated in pension dispute?

An ongoing battle between retirees and Wayne County, Michigan, has landed their dispute in the Michigan Supreme Court.

Over three years ago, Wayne County stopped funding the Inflation Equity Fund which paid county retirees an extra pension check each year based upon the performance of their investments. The surplus of the fund was transferred into the county's defined-benefit plan, which was not fully funded.

As a result of the dispute, the county and retirees with their representatives have fought over whether the displacement of money out of the Inflation Equity Fund violates the state of Michigan's Public Employees Retirement System Investment Act. Supporters of funding the Inflation Equity Fund state that it helped right shortfalls in the county's underfunded general pension fund, while opponents allege that no state laws were violated when the money was moved since the money never left the county's pension system.

It is now up to the Michigan Supreme Court to decide how this matter will be handled. Through all of the debate and rhetoric thrown around regarding this matter, the individuals who will most definitely suffer are those who depend upon their employee pensions earned through previously working for the county.

Employee rights regarding pensions and other employee benefits do not necessarily end when a worker retires or otherwise chooses to leave his job. The court will have to determine how best to serve the needs of those workers who served the county long before they were eligible to collect their pensions.

It will be interesting to see how the court decides this matter and as the state waits for an answer, workers all across Michigan may discover that they have legal questions regarding their employee benefits and pensions. Employment law attorneys are available to discuss such matters and may be able to offer help to those struggling to make their employers respect their rights as workers.

Source: Detroit Free Press, "Pension funds' 13th-check dispute goes to Michigan Supreme Court," Paul Egan, March 5, 2014

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