ERIC Number: EJ1169990
Record Type: Journal
Publication Date: 2016
Michigan's Public Educator Retirement System--On the Road to Bankruptcy: A Legal Analysis of Michigan
Geier, Brett A.
Journal of Education Finance, v41 n1 p451-472 Spr 2016
Since 1980, Michigan retirees have been afforded health care benefits for which they were required to pay 10 percent of the premium upon retirement--the remainder was paid for by the state. Recently, the Michigan Legislature reduced the financial obligation of the State for retiree health care benefits, placing it on the individual member. In concert with the increased cost to members is the deterioration of the perceived "promise" that certain health care benefits would be provided at a fixed cost in perpetuity. Public educators, through their respective labor organization, took issue with this course of action, and have sought redress in the courts. Employing the legal technicalities of contracts, unjust enrichment, and due process, these plaintiff employees sought to reverse the enactment of the statutes making these modifications. The plaintiff education members constructed an argument that is lucid and legally viable. However, the Legislative reaction to the initial suit was shrewd, and nullified the plaintiffs' legal theory. As a result, the legislation enacted by the State, while seemingly unfair to the plaintiffs, is ultimately constitutional. Nationally, public educator retirement benefits are being reduced and the cost to the individual and school district is rising. This series of legislation and subsequent litigation occurring in Michigan is a quality analogy that is being witnessed in other states around the country. In this article, the author provides a legal analysis on why what the Michigan Legislature did was constitutional.
Descriptors: Public Education, Public School Teachers, Teacher Retirement, Legal Problems, Fringe Benefits, Retirement Benefits, Costs, Unions, Court Litigation, Collective Bargaining, Contracts, State Legislation, Constitutional Law, Retrenchment, Politics of Education
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Publication Type: Journal Articles; Reports - Evaluative
Education Level: N/A
Authoring Institution: N/A
Identifiers - Location: Michigan
Grant or Contract Numbers: N/A