UPDATE Massive, systemic miscalculation of employee pension benefits over decades may have been uncovered at Contra Costa County’s Retirement Association.
A ReedSmith report to the board of the Contra Costa Retirement Association (CCCERA) has found that “inadequate reporting systems” may be “enabling overstatement of pensionable compensation” for county retirees. The report, originally sent to the CCERA October 28, 2009, shows examples including that of a compensation overstatement that produced $37,526 more annual retirement benefits than the employee was actually entitled to.
If true, thousands of current CCCERA pensions, based on last year salary, may have to be recalculated, benefits changed, and employee contributions in arrears collected from current and future retirement system members.
The CCCERA has planned a special meeting to discuss this issue Monday, January 11, 2010, at 9 a.m. The meeting will be held at the Concord Hilton, 1970 Diamond Blvd., Concord, CA.
While noting that retiring employees ought to receive every dime due to them by law, the report recommends that the CCCERA:
– Investigate employer pay and reporting practices just to find out the extent to which possible widespread overstatement of final compensation has been occurring throughout the retirement system and for how long.
– Determine what employee contributions, if any, have been collected on elements of compensation mistakenly included in final compensation figures.
– Determine what changes ought to be made to bring the system into compliance with current applicable law.
– Determine whether and what corrective measures to take vis a vis current and future, active and deferred members of the retirement system—including recalculation of benefits, arrears, contributions, and other actions.
– Insure new system delivers proper benefits to members of the retirement system.