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Federal Eye
Posted at 09:50 AM ET, 11/17/2011

Federal workers are not overpaid, union leader says


National Treasury Employees Union President Colleen M. Kelley. (Courtesy of NTEU)
Federal workers are not overpaid and earn higher salaries than other workers because of their age, experience and education, according to Colleen M. Kelley, president of the National Treasury Employees Union, who participated in a Washington Post Q&A Wednesday regarding federal compensation.

Kelley’s chat came in response to last week’s conversation with James Sherk, of the Heritage Foundation, who has published a study on federal pay that is widely cited by Republican presidential candidates touting their plans to curtail the federal workforce.

Below are highlights of the questions Kelley fielded and her responses:

Question: In my office, the pension federal employees receive is the envy of all — especially since our employer just terminated our pension plan. While their annual salaries may be less than that in the private sector, their total compensation is nothing to sneeze at. I know several people who retire from the feds when they are in their 50s, collect their 80% of their salary pension for life, and secure another job either as a fed contractor, a state employee, or a private sector employee. A pretty nice deal, if you can get it.

Kelley: Of course NTEU does not support any employer terminating a pension plan but there is a lot of fiction out there about federal pensions so let me provide some facts.

The Federal Employees Retirement System (FERS) was established by Congress in 1983 and is today fully funded. Let me repeat: FERS has no unfunded liability.

The program’s design is a “three-legged stool” comprised of a small annuity, Social Security and a savings plan. It provides modest, middle-class retirement security to its workers. Yet, some in Congress are calling for the abolishment of the defined benefit portion of FERS.

The typical federal employee with a lifetime of service in the federal government will have an annuity from the defined benefit of approximately $1,000 per month. The government’s 401(k)-like fund, the Thrift Savings Plan, may provide an annuity of around $400 per month if the average employee is able to fully contribute 5 percent of salary for 30 years. Contrary to what some may claim, there are no federal employee millionaires. Not even close.

Question: If the public realized that the majority of federal jobs are professional which require at a minimum a college degree maybe the comparisons with Walmart and other retail jobs would cease. Our child is studying in a high tech field and highly sought out and well paid field but is considering the feds because friends are in the military and wants to support them.

Kelley: I agree there are inappropriate comparisons that are too often made.

The fact is that federal employees are better educated than the private sector. Fifty-one percent of federal employees have college degrees, while 35 percent of private sector employees do. Additionally, 20 percent of federal employees have graduate degrees compared to 13 percent of private sector employees.

Question: My daughter, an attorney, left a prestigious law firm as a 5 year associate and went to the government, taking a 60% pay cut. Although she still makes good money by most standards, it’s not what she had been getting. And the government does not give maternity leave — she had to use vacation and sick leave!

Kelley: You make an excellent point on the maternity leave issue. This is an area where the federal government is far behind the private sector and states, providing no paid parental leave. None. NTEU supports legislation to change that.

Read the full chat and share your thoughts in the comments section below.

Follow Ed O’Keefe on Twitter: @edatpost

Further reading:

The study driving GOP criticism of federal pay

For more, visit PostPolitics and The Fed Page.

By  |  09:50 AM ET, 11/17/2011

Categories:  Workplace Issues

 
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