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Just the FAQs on Windfall Elimination (WEP) & Government Pension Offset (GPO)


A Primer on Federal Laws that are Harming Efforts to Attract and Keep High Quality Workers:

The Windfall Elimination Provision (WEP) — reduces the earned Social Security benefits of an individual who also receives a public pension from a job not covered by Social Security.

Which workers does the Windfall Elimination Provision harm?

The WEP affects people who worked both as public employees in jobs not covered by Social Security and in jobs in which they earned Social Security benefits. For example, the WEP affects educators who do not earn Social Security from their jobs in the public schools, but who work part-time or during the summer in jobs covered by Social Security. The WEP also affects people who change careers, moving from a job in which they earn Social Security benefits to  a job, such as teaching, in which they are not covered by Social Security.

How does the Windfall Elimination Provision work?

The WEP reduces the factor by which average earnings are multiplied to determine Social Security benefits. How much the factor is reduced depends on when the individual becomes eligible to retire and how many years of earnings he or she has accumulated.

For example: Bob — a retired educator, who is currently 71 years old — worked for 17 years in the private sector and paid into in the Social Security system. Bob then decided to become a teacher and contributed to the California State Teachers’ Retirement System (CalSTRS). Bob worked for 14 more years as a teacher contributing to CalSTRS. According to the Social Security Administration, he earned monthly benefits of $540 per month for contributions paid into the Social Security system while he worked in the private sector. However, because of the WEP, his actual monthly benefits will be cut by $296 a month. Bob will receive only $244 per month from Social Security instead of the $540 he earned.

The Government Pension Offset (GPO) — reduces public employees' Social Security spousal or survivor benefits by an amount equal to two-thirds of their public pension. Spousal and survivor benefits are normally available to any person whose retired or deceased spouse worked at a job in which he or she earned Social Security benefits. The GPO reduces or eliminates these benefits.

Which workers does the Government Pension Offset harm?

The GPO affects individuals who worked as federal, state or local government employees, including educators, police officers and firefighters, if the job was not covered by Social Security.

How does the GPO work?

The GPO reduces Social Security spousal or widow(er) benefits by two thirds of the amount of an individual's public pension. For example:

Jane — a widowed, retired educator receives a public pension of $2431 a month. Her job in the public school system was not covered by Social Security. Her deceased husband, however, earned Social Security benefits from his job in the private sector. An amount equal to two-thirds of Jane's public pension — or $1628 — will be cut from her Social Security widow's benefits. This means that if she were eligible for $1500 in survivor benefits, the GPO would reduce her benefits to $0 ($1500 - $1628 = $0).

Source: National Education Association

How Do the WEP/GPO Hurt Teachers, Firefighters, and Others?

These provisions impact educators, police officers, firefighters and other public employees who have dedicated their lives to public service.

Nine out of 10 public employees affected by the GPO lose their entire spousal benefit, even though their spouse paid Social Security taxes for many years. Some 360,000 individuals lose an average of $3,600 a year due to the GPO — an amount that can make the difference between self-sufficiency and poverty.

The WEP causes hard-working people to lose a significant portion of the benefits they earned themselves. The number of people impacted by these provisions across the country is growing every day as more and more people reach retirement age.

Impacted people have less money to spend in their local economy and sometimes have to turn to expensive government programs like food stamps to make ends meet.

Individuals who worked in other careers are less likely to want to become teachers if doing so will mean a loss of earned Social Security benefits. These provisions are also causing current educators to leave the profession, and students to choose courses of study other than education. 

Excerpted from Perspectives: A Briefing for Congress on Issues of Importance to California’s Educators - Provided by the 325,000 Members of the California Teachers Association/NEA

Every child deserves a chance to learn and no child succeeds alone.

© 1999- California Teachers Association