Transparent California Sues CalPERS To Identify Disability Retirement Claims
About 15 years ago, two reporters working for the Sacramento Bee reporters received a tip that a number of high-ranking California Highway Patrol officers were filing workers comp injury claims shortly before they were to retire. In essence, this gave them substantial disability pensions with tax-free income to add to their regular retirement package.
The reporters, John Hill and Dorothy Korber, were not able to access all the records, however. CalPERS agreed to provide the amount of the pension, but would not disclose whether or not the retirement was classified as a disability retirement. Hill and Korber resorted to building a database of workers compensation claims to substantiate their award-winning report. And that story eventually led to reforms of the system, and arrests for those participating in the scam, which became known among the rank-and-file officers as the “Chief’s Disease.”
Transparent California Sues for Greater Accountability from CalPERS
Partially as a result of Hill and Korber’s groundbreaking investigation, Transparent California, a Nevada-based nonprofit watchdog organization, has taken up the banner. On its website, Transparent California lists the pay and pensions of state and local government employees.
Recently, Transparent California filed lawsuit against CalPERS, forcing it to specify whether a retiree’s pension is due to “service” or “disability.” Transparent California alleges in its suit that CalPERS is unlawfully withholding information that is necessary to safeguard the system from waste, fraud and abuse.
To establish precedent, Transparent California’s suit states that nearly two dozen of California’s independent pension funds already make this information available to the public.
CalPERS Responds and Labor Organizations Intervene
CalPERS countered, stating that disability pensions are exempt from disclosure pursuant to state laws that protect the privacy of medical records and information that are submitted to the pension system. Further, disclosing such information would deprive members of their individual right to determine whether or not to disclose their confidential medical information.
A coalition of labor organizations has been given permission to intervene on CalPERS’s behalf. These organizations include California Correctional Peace Officers’ Association, Cal Fire Local 2881, California Professional Firefighters, and California Association of Highway Patrolmen.
According to CalPERS’ Comprehensive Annual Financial Reports, over the last decade the total number of CalPERS disability retirements has declined. However, work-related “industrial disability” retirements, which often are more generous, have increased. CalPERS has not offered an explanation regarding this growing trend toward industrial disability.
Transparent California’s suit against CalPERS is the first of its kind to force disclosure of the identity of disability pensions. Several other Transparent California suits have focused on the release of individual pay and pension amounts.
L.A. Times Reports Abuse of Disability Retirement System
An article in the Los Angeles Times in February of 2018 reported that more than 1,200 police and firefighters who were collecting pay and pensions in a special program took injury leaves at twice the amount of their usual pay. The article reported that five Los Angeles City Council members called for an investigation and reform of the Deferred Retirement Option Plan that allowed police and firefighters to almost double their pay while allowing them to take lengthy injury leaves.
The Times’ investigation presented several examples of abuse and fraud, costing the taxpayers hundreds of millions of dollars. The city launched an investigation of the allegations in order to protect both taxpayer funds and the integrity of the program.
Some Pension Systems Comply Others Don’t
Over a decade ago, CalPERS, CalSTRS, and UC Retirement, the three largest state pension systems, all complied when asked by a reform group to disclose individual pension amounts for its website listing the “$100,000 Club” of large pensions.
But while these systems complied, the California Foundation for Fiscal Responsibility and others were forced to file suit against more than half a dozen other county systems to get the requested information.
The Transparent California suit to force CalPERS to identify disability pensions was filed in Sacramento County Superior Court. No hearing has been scheduled as yet.
CalPERs Disability Retirement Attorneys
Our Long Beach attorneys will diligently follow the progress of the CalPERS suit to digest the impact it has on workers comp and disability retirement issues. If you are injured on the job close to the time you intend to retire, seeking the advice of an experienced attorney will help you protect your rights and ensure fair and legitimate settlement in terms of disability retirement.
We would be happy to help you determine your eligibility for disability retirement under the CalPERs system.
This article applies to members of California Public Employees’ Retirement System (CalPERS); and does not reflect the rules, laws or regulations governing how other public retirement systems are administered. If you have question about another public employee retirement system, find your system, below – or call our attorneys at: 562-622-4800
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