Tier 6 reforms included in state budget

Victory for public unions

In a long-sought triumph for public-sector unions, state lawmakers and Governor Kathy Hochul have instituted changes to the Tier 6 retirement plan they said will make it easier to attract people to government jobs, an outcome critics have called unnecessary and expensive.

For the purpose of pension benefits, final average salary will now be determined according to the three consecutive years when an employee earned the most, rather than the current five years. Another reform extends until March 2026 the exclusion of a Tier 6 member’s overtime earnings when determining the employee’s contribution rate to their pension benefit. The latter change also applies to Tier 5 members.