PROVIDENCE –– Rhode Island’s public employee labor unions are mobilizing to file a class-action lawsuit against the state to block pension changes the legislature adopted in June to save taxpayers tens of millions of dollars.

 

The executive committee of Council 94, American Federation of State, County & Municipal Employees, officially voted last week to file a lawsuit, according to President J. Michael Downey. And Council 94 has been joined by a coalition of other unions representing 26,000 public school teachers and state workers affected by new pension rules, which among other things, establish a minimum “target” retirement age of 62.

“All the public employees unions are in,” said Marcia Reback, president of the Rhode Island Federation of Teachers & Health Professionals. “We had a meeting of all the lawyers who represent the public employees … Now we’re in the process of selecting our lead attorney.”

 

The coalition of at least seven labor unions expects to file suit by “the early fall,” according to National Education Association executive director Robert A. Walsh.

 

“It would obviously be a class action on behalf of everybody. That’s the current thinking anyway. One lead attorney, one lawsuit,” he said. “Once it became clear they were going after people who were vested, I don’t think we had any option.”

 

Indeed, the pension changes approved by the General Assembly apply to all employees not eligible to retire before Sept. 30, even those considered “vested” with more than 10 years in the system.

“You can’t take away from people who have a contract who are vested,” Reback said. “We believe they are being materially damaged.”

 

The unions first threatened a lawsuit in the days before the Assembly passed a state budget that was balanced, in part, by the pension provisions. Facing massive budget deficits, lawmakers booked savings of $47 million for the fiscal year that ended June 30 and another $59 million for the current fiscal year based on actuarial projections on changes to the state’s retirement system.

 

Walsh acknowledged that the lawsuit could create more problems for organized labor down the road.

 

“Even if we win, are they going to come after us again? Probably,” he said. “But one step at a time … You can’t not defend your members’ interests on the speculation that they’re going to try to come after you in a different way in the future. That’s kind of one of the cardinal rules around here.”

 

Organized labor is already playing defense on other fronts.

 

Governor Cariceri released tentative plans earlier in the month to force unpaid “government shutdown days” on Rhode Island’s 13,400 state employees. It was a proposal crafted after the Assembly included unspecified budget savings of $57.6 million across all state departments. The governor must design a plan to meet those targets.

 

Cariceri’s office declined to comment on any lawsuit until it has been filed. Spokeswoman Amy Kempe noted, however, that the state attorney general’s office would represent the state in such a legal action.

 

Under the new pension rules, the state has adopted a target minimum retirement age, linked cost-of-living increases to the consumer price index, and tied key pension calculations — now based on a three-year salary average — to a worker’s highest five-year salary average.

 

The minimum retirement age is based on a hugely complicated formula, but simply put: the further away from retirement the employee is, the higher the age requirement. For example, a state employee who started work at age 25 who could retire today at 53, would have to wait until 53 and three months.

 

It could have been worse for union members. The governor’s office and a legislative study commission had recommended more significant changes.

 

Reback, however, likened the situation to “losing one leg from the knee down instead of losing both legs from the knee down.”

 

“Everything is relative,” she said.