Thousands of Social Security recipients should benefit from labor-backed reform

Thousands of Illinoisans will see more money from Social Security in the coming months, as President Joe Biden on Jan. 5 signed the Social Security Fairness Act, which repealed two laws that had cut hundreds of dollars in monthly Social Security benefits for more than 2 million Americans.

The act eliminated the Windfall Elimination Provision and the Government Pension Offset. Created in the late 1970s and early ’80s, the WEP and GPO affected workers who’d worked at jobs where they paid into Social Security and had enough covered employment to qualify for benefits, but unfairly penalized those retirees by cutting benefits because they’d also earned public pensions in jobs that didn’t pay into the Social Security system. GPO likewise reduced benefits for those workers’ surviving spouses and family members.

“This historic victory restores retirement benefits for 150,000 public servants in Illinois and millions nationwide, including teachers, nurses, firefighters, and law enforcement officers,” said Illinois Federation of Teachers President Dan Montgomery.

Nationwide, the years-long effort had widespread support from public-sector unions. Many advocates said both programs fell heavily on those who held public-sector jobs that had low pay or a small pension, or those who were left widowed by a spouse with a public pension and received a low survivor’s benefit.

Although the repeal isn’t retroactive any further than 2024, “it gains real justice going forward and is a tremendous victory,” said American Postal Workers Union President Mark Dimondstein.

The repeal was supported by the AFL-CIO, the International Association of Fire Fighters (IAFF), the American Federation of Teachers (AFT), and the National Education Association, among others.

Another union supporter, the American Federation of State, County and Municipal Employees (AFSCME), reported that the states most affected are Alaska, California, Colorado, Connecticut, Illinois, Louisiana, Maine, Massachusetts, Missouri, Nevada, Ohio and Texas. Local governments likely to be most affected are Los Angeles and Los Angeles County, and Chicago and Cook County, AFSCME added.

“The bill I'm signing today is about a simple proposition,” Biden said during the White House signing ceremony at the White House. “Americans who have worked hard all their life to make an honest living should be able to retire with economic security and dignity – that's the entire purpose of the Social Security system.”

The law says it will apply to benefits paid after December 2023, apparently meaning that any reductions reflected in Social Security benefits last year will be calculated and sent to beneficiaries this year. Beneficiaries affected by the measure could receive thousands of dollars in one lump-sum payment to cover 2024’s shortfall.

As soon as the Social Security Administration updates its system, recipients will start to get their full, restored benefits. Biden said that Social Security benefits will increase by an average of $360 a month for more than 2 million recipients.

"That's a big deal in middle-class households like the one I grew up in and many of you did," he said.

The bill – the White House said it’s the first Social Security reform in 20 years – passed the House of Representatives by a 327-75 vote on Nov. 12, and was approved in the Senate by a 76-20 vote Dec. 21.

Hundreds of lawmakers felt it was unfair to reduce retirees’ earned benefits because they had public pensions. After all, the vast majority of U.S. workers get their full Social Security benefits, while also receiving funds from their 401(k) and IRA contributions over their working years.

Still, co-sponsor U.S. Sen. Sherrod Brown said he was surprised that the approval was so lop-sided.

“We expected pretty much 49 Democrats and a dozen – 15 at the most – Republicans,” Brown said. “We got to 76 votes because people understand the fairness of this, of fixing this.”

The vote came a day after Brown gave his farewell address in the Senate, losing his seat in November to Trump-backed Bernie Moreno. Brown stressed his focus during his 30-year career on Capitol Hill has been on unions and workers’ rights, and after years of pushing the Social Security Fairness Act, helping to pass it was especially pleasing, he said.

“It's a wonderful way to end the year,” he said. “It really is to me about the dignity of work and fighting for workers.”

Voting for the bill were 76 senators (46 Democrats, 27 Republicans and 3 independents). The 20 No votes were all Republicans; four senators did not vote.

Illinois lawmakers overwhelmingly supported the bill. Both Tammy Duckworth and Dick Durbin voted Yes, as did 15 of Illinois 17 members of the House – all 14 Democrats including West Central Illinois’ Eric Sorensen (17^th Dist.) and Nikki Budzinski (13^th), plus Republican Mike Bost (12^th).

The only No votes from Illinois’ delegation were Republicans Darin LaHood (16^th) and Mary Miller (15^th).

Brown’s co-sponsor, Maine Republican Sen. Susan Collins, said, "I have fought for this change since 2003, when I held the first-ever Senate hearing on repealing the WEP and GPO, and I am proud that this law will ensure public service no longer comes at the expense of the retirement benefits earned by an individual or their spouse. This is a win for fairness and for those who have dedicated their lives to serving their communities."

According to the Social Security Administration, those who have previously filed for Social Security benefits don’t need to take any action if the agency has your current mailing address (or direct-deposit information, especially if your address has recently changed). Most beneficiaries would be able to verify this on their personal "My Social Security" account without calling or visiting a Social Security office. The agency recommends visiting www.ssa.gov/myaccount to sign in or create your account.

Investment adviser Terry Savage, co-author of the book “Social Security Horror Stories,” recommended, “If you want to know the ‘correct’ benefit you should receive (without the WEP or GPO), you can go to www.MaximizeMySocialSecurity.com and – for a $49 fee – run the software, without including the fact that you have a public pension. That should give you the correct calculation of future benefits.”