Help NYSUT fix tier six

digital illustration of a woman holding a large piggy bank, and a man holding a small piggy bank

What’s this about?

It’s been over a decade since Tier 6 was added to the New York state pension system. Since then, more than 100,000 NYSUT members earn a significantly reduced pension as compared to earlier tiers. Consider this:

Tier 4 member contributions are capped at 3 percent and end after 10 years.

Tier 6 members pay 3 to 6 percent into the pension system their entire career — their contributions grow with pay raises.

Tier 4 members can retire at 55 with 30 years of service.

Tier 6 members must work to age 63, up to 40 years of service, or face heavy penalties.

How did this happen?

On Jan. 1, 2010, then Gov. David Paterson enacted Tier 5, increasing member contributions to 3.5 percent for members’ entire careers and increasing retirement eligibility from 55 to 57 years old with 30 years. A little over two years later, then Gov. Andrew Cuomo imposed Tier 6 on those who joined the system on or after April 1, 2012.

How bad is it? Pretty bad.

A Tier 4 member who retires at 55 with 30 years of service would receive 60 percent of their Final Average Salary. At an FAS of $90,000, their pension would be approximately $54,000.

A Tier 6 member who retires at 55 with 30 years of service would only receive 26.4 percent of their Final Average Salary. At an FAS of $90,000, their pension would be approximately $20,000. This after paying tens of thousands more into the pension system.

Why does this matter?

Fixing Tier 6 is about solidarity and fairness.

It’s unfair that some NYSUT members must work longer, and contribute more, to earn a significantly reduced pension. This should anger ALL union members.

Fixing Tier 6 is about dignity.

The hallmark of a public-service career is the promise of a dignified retirement. With Tier 6, the state abandons its commitment to that guarantee.

Fixing Tier 6 is about keeping talented educators in the classroom and recruiting new educators into the profession.

Forcing younger members into a lesser pension tier undervalues our profession. Our work is important. Our pensions should reflect that.

Fixing Tier 6 is about unity and power.

When we stand together in solidarity, we have power. We’ve made big changes before. We can do it again. Thanks to our advocacy, we’ve already won some pension improvements:

In 2022, member vesting dropped from 10 to five years, guaranteeing a pension benefit for 85,000 Tier 6 members. And in 2000, after a decade-long campaign, we ended Tier 4 contributions after 10 years and reduced Tier 4 early retirement penalties.

We know how to fix this, but we need your help!

Whether you’re a retiree or a Tier 4, 5 or 6 member, you can help NYSUT Fix Tier 6.

Join NYSUT’s Fix Tier 6 Team to help with direct outreach.

Share the Fix Tier 6 message with other members.

Donate to VOTE-COPE, NYSUT’s voluntary, non-partisan political action fund. Your donations help us get our message out to lawmakers so we can make change!

‘It doesn’t add up’

Two math teachers criticize Tier 6

Kimberly pennant

Anna Rossi and her daughter, Michelle Rossi, both teach math at Oneonta High School.

Molly Belmont

molly.belmont@nysut.org

nna Rossi and her daughter, Michelle Rossi, have a lot in common; they both teach math at Oneonta High School in classrooms right across the hall from one another. After school, they both coach sports and run a Regents review session. At the end of the day, the Oneonta Teachers Association members drive home to the same house.

But despite their identical careers, their retirement plans bear almost no resemblance to one another. “It doesn’t add up,” said Michelle.

The New York State Teachers’ Retirement System and the New York State and Local Employees’ Retirement System, which represents most School-Related Professionals, have six retirement tiers. Tier membership is based on a teacher’s hiring date. Educators hired between Sept. 1, 1983, and Dec. 31, 2009, are part of Tier 4. Members hired on or after April 1, 2012, are part of Tier 6.

Anna is in Tier 4. Michelle is in Tier 6 — or as she and her colleagues call it, “Tier Sucks.”

That is because Tier 6 members who retire after the same length of service as Tier 4 members receive significantly reduced pensions. When Anna retires in a few years, she will earn more than 60 percent of her Final Average Salary, whereas Michelle would only earn 26.4 percent of her salary for teaching the same length of time.

To add insult to injury, Tier 6 members like Michelle pay markedly more for those reduced benefits. Tier 6 members’ pension contributions start at 3 percent and increase as they earn more, reaching 6 percent when teachers earn $101,000. (By contrast, Tier 4 members’ pension contributions end after 10 years and are capped at 3 percent.)

“In Tier 6, you are contributing more, and therefore having more taken out of your paycheck, so you have less money to spend. You are also being asked to work more years and, in the end, you will make less. That’s a significant difference,” said Anna. “And something needs to be done about it.”

Sadly, thanks to a 169 percent increase in college expenses, Tier 6 members are also graduating from college with more student debt, which further eats into their take-home pay. In the 1980s, when Anna attended college, the average tuition was $1,000 per year; today, Michelle is paying about $1,000 per class.

“You either have to go right into graduate school and get a job when you are done or get the job and attend school while you’re teaching. Either way, you’re putting money toward school at the beginning of your career, and it’s a lot compared to what you’re making,” said Michelle.

(NYSUT’s New Deal for Higher Ed seeks a generational investment so all New Yorkers can access quality public higher education. Learn more at NewDealForHigherEducation.org.)

At the beginning of her career, Anna said it was not easy to make ends meet, either. During the summers, she worked at a sports shop and cleaned houses to offset her skimpy paychecks. She knew once she got through the first 10 years, she would be able to relax a little.

“We don’t start off with a high salary as it is, and we are expected to do much more for what we get paid, so the retirement benefits sort of make up for that,” said Anna.

Unfortunately, Michelle does not have that same comfort, and she is not the only Tier 6 member crunching numbers and shaking her head. The current state of Tier 6 is leaving many educators wondering if teaching is worth it.

“You’re going to lose good people,” said Anna. “You’re going to lose good teachers. I’m happy NYSUT is taking a stand on this.”

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