MSCA Perspective - July 2001
MTA Sues State Over Failure to Fund Retirements
The Massachusetts Teachers Association has filed a complaint to force the Board of Higher Education to fully fund retirement plans for its members who are enrolled in the Optional Retirement Program (ORP).
Legislation was passed in January 1994 to allow some state college faculty and other employees of the Board of Higher Education to choose between participation in the State Employees Retirement System or an alternative defined contribution plan. The option is available to incoming employees and those with ten or fewer years of creditable service. Those who choose the ORP pay in an amount equal to that contributed by newer members of the State Employees Retirement System: 8% for up to $30,000 and an additional 2% for amounts over $30,000 of regular compensation. In addition, the regulations require the employer to contribute an amount equal to 5% of the regular pay of a participating ORP employee directly into the ORP Trust Fund.
The MTA's specific claim is that the Board has failed to make, in a timely fashion, monthly employer contributions to designated employee retirement investment accounts in violation of the regulations, resulting in a failure to achieve the proper rate of return on investments made on behalf of participating employees by ORP providers.
The MTA complaint was filed on April 11, 2001 in the Superior Court of Suffolk County, seeking declaratory relief and damages on the ground that the Board of Higher Education has failed to follow the Optional Retirement Program (ORP) regulations adopted by the Board of Higher Education on February 2, 1995 (610 CMR 11.01, et. seq). Members who have experienced problems with their Optional Retirement Program contributions should contact their local chapter president, who will forward their names to Sandra Quinn, the MTA attorney handling this case.