Local union leaders, Arizona Democrats praise new Social Security Fairness Law

Local union leaders are praising the passage of a law that boosts social security payments to some public employees.

Advocates say the Social Security Fairness Act ends a decades-old disparity, which Sen. Ruben Gallego said wasn’t fair.

"They paid into this for many years and are not getting the full benefit of what they paid into which is a very gross injustice," Gallego said.

Previously, some public employees could not get full Social Security benefits if they also received retirement benefits from state or local governments. That was despite paying full contributions.

The new law signed by President Joe Biden over the weekend ended those limits.

“We have so many retirees that have been eagerly awaiting for this landmark legislation. It’s nice to see congress and all parties come together to do what’s right in society," Phoenix firefighter union president Bryan Willingham said.

Some critics say it will put more of a strain on the Social Security system. Congressman Greg Stanton’s office estimates nearly 45,000 Arizonans will benefit from the change.

The measure boosts Social Security payments for current and former public employees, affecting nearly 3 million people who receive pensions from their time as teachers, firefighters, police officers and in other public service jobs.

The bill rescinds two provisions — the Windfall Elimination Provision and the Government Pension Offset — that limit Social Security benefits for recipients if they get retirement payments from other sources, including public retirement programs from a state or local government.

The Congressional Research Service estimated that in December 2023, there were 745,679 people, about 1% of all Social Security beneficiaries, who had their benefits reduced by the Government Pension Offset. About 2.1 million people, or about 3% of all beneficiaries, were affected by the Windfall Elimination Provision.

The Congressional Budget Office estimated in September that eliminating the Windfall Elimination Provision would boost monthly payments to the affected beneficiaries by an average of $360 by December 2025. Ending the Government Pension Offset would increase monthly benefits in December 2025 by an average of $700 for 380,000 recipients getting benefits based on living spouses, according to the CBO. The increase would be an average of $1,190 for 390,000 or surviving spouses getting a widow or widower benefit.

Those amounts would increase over time with Social Security’s regular cost-of-living adjustments.

The change is to payments from January 2024 and beyond, meaning the Social Security Administration would owe back-dated payments. The measure as passed by Congress says the Social Security commissioner "shall adjust primary insurance amounts to the extent necessary to take into account” changes in the law. It's not immediately clear how this will happen or whether people affected will have to take any action.

The future of Social Security has become a top political issue and was a major point of contention in the 2024 election. About 72.5 million people, including retirees, disabled people and children, receive Social Security benefits.

The policy changes from the new law will heap more administrative work on the Social Security Administration, which is already at its lowest staffing level in decades. The agency, currently under a hiring freeze, has a staff of about 56,645 — the lowest level in over 50 years even as it serves more people than ever.

The annual Social Security and Medicare trustees report released last May said the program’s trust fund will be unable to pay full benefits beginning in 2035. The new law will hasten the program’s insolvency date by about half a year.

Along with ratifying the Social Security Fairness Act, earlier in his presidency Biden signed the Butch Lewis Act into law, which saved the retirement pensions of 2 million union workers.