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Claim of unlawfully reduced pensions for veterans gets a second look

Workers in Indiana who are close to retirement age know how important a pension can be. With the increased instability of Social Security, many baby-boomers are looking forward to the financial security that a pension can provide. But what if you discovered that your pension had been deliberately decreased without your knowledge? What if that reduction had been done so in a manner that could be seen as unlawful?

U.S. prosecutors will be answering this question after they complete their new probe into whether New York City officials unlawfully reduced pension benefits to retired employees who served in the military since the attacks of September 11th.

In August of this year, the U.S. attorney for Manhattan filed a lawsuit in federal court accusing New York City of using only police officers' base pay to calculate benefits. The attorney points out that laws specifically dealing with veterans who return to work say that when calculating benefits, employers must take into consideration what an employee would have made during the time they were actually in military service.

According to prosecutors, the miscalculation of pay led to a decrease in pensions. In a statement to city employees, prosecutors said, "We are encouraging any covered city employee who thinks his or her benefits were unlawfully calculated to come forward ... [to] assess whether the unlawful practices identified with respect to the NYPD extend to other city agencies as well."

It is estimated that approximately 2,000 NYPD officers had served in the military between 2001 and 2012. During that time, it is calculated that the officers' pension totaled approximately $24.75 billion in 2011, a 24 percent increase from the previous year. Attorneys now want to make sure that these servicemen see the result of this increase rather than the current decrease the city is trying to give them.

Source: Thomson Reuters News & Insight, "U.S. to expand probe into New York City pensions for veterans," Basil Katz, Oct. 22, 2012

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