Legislators are renewing a long-running debate about whether overtime earnings should continue to be included when calculating pensions for state employees.

A Republican lawmaker who introduced a measure to end the practice, says reform is needed now with state overtime spending on the rise. 

But labor unions and their advocates argue that the repeal would unfairly penalize employees who increasingly face mandatory overtime assignments, especially correction officers, state troopers and others in hazardous or direct care jobs. The solution, they say, is for government to instead reverse nearly a decade of staffing cutbacks.

“Those positions are often the most difficult to work at,” said Sen. Cathy Osten, D-Sprague, a former correction officer supervisor and former president of the correction supervisors’ union. “The fact is we’re lucky to have people that want to do this arduous work.”

Osten, who is co-chairwoman of the Appropriations Committee, said there is a 10% vacancy rate, or higher, in many hazardous duty job categories. Between 2011 and 2018, as state government struggled with numerous budget deficits, then-Gov. Dannel. P. Malloy and the General Assembly often used attrition and hiring freezes to balance budgets, shrinking the Executive Branch workforce during that period by about 10%. Much of that staffing decline hasn’t been restored.

Osten predicted prior to Friday’s hearing on the proposed pension calculation restrictions that the measure would die in committee. The panel faces an April 25 deadline to approve bills.

Correction officer Sarah Peters, who testified against new pension calculation restrictions, said mandatory overtime is wearing down staff.

“While you’re at home with your families on holidays, we come in expecting to work one shift, only to be mandated for another eight hours due to staffing shortages and emergencies,” she said.

Every hour of overtime, every double shift, takes a toll on our health and our lives,” said Michael Pearson, a correction officer lieutenant. “Those additional years we may have should be spent with our families, enjoying the life we’ve worked hard for, and securing a better future for our children.”

Overtime spending continues to surge

But Sen. Rob Sampson, R-Wolcott, who joined GOP Reps. Anne Dauphinais of Killingly and Gale Mastrofrancesco of Wolcott in sponsoring the pension limitations measure, says there’s no intent to single out any class of state employees.

“However, we must acknowledge that the increasing prevalence of ‘pension spiking’ — where employees significantly increase their pension earnings in the final years of their careers through overtime or other means — has raised significant concerns,” he testified.

Connecticut entered this fiscal year with more than $35 billion in unfunded pension liabilities, according to Gov. Ned Lamont’s budget office. This represents an enormous legacy debt created by governors and legislatures who served between 1939 and 2010 and who failed to save properly for retirement benefits for state employees and municipal teachers.

Sampson added that he believes larger base salaries and increased hiring is needed in some job areas to curb overtime.

According to the legislature’s nonpartisan Office of Fiscal Analysis, agencies and departments spent more than $158 million on overtime through the first six months of this fiscal year — about $6.7 million, or 4.4%, more than they had through the first half of the prior year.

Five departments accounted for more than 95% of this year’s overtime spending — Correction, Mental Health and Addiction Services, Developmental Services, Children and Families, and Emergency Services and Public Protection, which includes the state police.

The Hartford-based Yankee Institute for Public Policy, a conservative group that supports the bill, testified that delaying new restrictions on pensions for public safety personnel should be considered to avoid sparking mass retirements of command-level staff.

“It is time to put Connecticut’s fiscal house in order,” the policy group added in its testimony, calling the pension calculation restrictions “a critical step toward fiscal responsibility.”

The average retired state worker enjoyed an annual pension of $46,691 as of June 2023, according to nonpartisan analysts.

But because of unions concessions agreements ratified in 2009, 2011 and 2017, recent hires will receive significantly less generous pensions than those of current retirees.

Some state agency heads have complained they struggle to retain staff because the benefits offered aren’t enough to offset higher wages many workers can earn in the private sector.

Hartford attorney Daniel Livingston, chief negotiator for the State Employees Bargaining Agent Coalition, said Friday that removing overtime calculations would worsen pay disparities along racial and ethnic lines.

White state employees currently earn about $10,000 more annually, on average, than minorities. That’s because white employees hold a greater share of state management posts than rank-and-file jobs.

Managers don’t receive overtime, but their salaries generally are adjusted upward to reflect that rule, which ultimately helps to grow their pensions.

But if overtime payments are removed from pension calculations, state government’s blue-collar workforce, which is more racially and ethnically diverse, would suffer while managers would not, Livingston said.

The Lamont administration hasn’t yet announced any position on the bill. Chris Collibee, the governor’s budget spokesman, said Friday that “these matters are covered by collective bargaining and any changes to pension calculations would [also] be subject to negotiations.”