Correcting an Inequity!

            An issue that has been a point of contention for teachers who are about to retire is how the final average salary is calculated.  In the New York State System, earnings beyond the normal school day are calculated in the final three-year average salary.  Unfortunately, teachers in the New York City Retirement System were unable to calculate these earnings in their final year salary for pension purposes. 

Finally, after many years of effort, the UFT was able to secure an agreement that all teachers that retired after November 24, 1998 could have this “per session service” included in the calculation of their pension benefits. Although this was a major victory for teachers after that date, it did nothing to correct the inequities that existed before that date.

            In response to this situation, a person by the name of Arnold H. Nager initiated a class action lawsuit.  Under the proposed agreement, all class members and their beneficiaries that are entitled to an increase in benefits may receive a payment to adjust the monthly benefits that should have been paid by the TRS since August 30, 1996 and an adjustment of the benefits in the future. No reliable data exists for per session payments received before January 1, 1980; therefore, documentation must be submitted in this instance. At the present time, payroll records are being reviewed.  It is the intent of the interested parties to develop formulas that closely approximate the adjustment of each Class member’s benefits, rather than to require a full actuarial examination of each Class member’s benefits record.  All retroactive payments of adjusted benefits will receive simple interest at 5% annually.           

The New York State Supreme Court will hold a hearing on the proposed settlement on May 17, 2007.  Legal fees and expenses may reduce adjusted benefits. It is anticipated that Class members will receive their adjustments and retroactive payments about 12 months after approval of the proposed settlement.           

Status reports of the proposed settlement are available at the following website: www.persessionpaycase.com.  If you feel that you may be a prospective member of this class action, you may contact either of the following courts:

1.David S. Preminger                        2. Alan M. Sandals

         708 Third Avenue                              One South Broad Street

          Suite 1600                                          Suite 1850

          New York, N.Y. 10017                      Philadelphia, Pennsylvania 19107

          (212) 682-1900                                  (215) 825-4000 

I hope that this information will be of benefit to any current or former AFA member who is a member of this class action suit. 

                                                                                    Jerry Schwartz