Judge Shocks Legislature, Indebts Taxpayers with another Controversial Decision

Circuit Court Judge Jackie Fulford ruled yesterday that last year’s legislative mandate directing state workers to contribute 3 percent of their salaries toward their pensions was unconstitutional.

In only an eleven-page decision, Judge Fulford declared Senate Bill 2100 violated the Florida Constitution by “abridging the right [of state workers] to engage in effective collective bargaining.”  Collective bargaining is the process by which employers and employees negotiate working conditions and compensation.

According to the ruling, the Legislature unilaterally changed a core item in employee contracts without negotiating with state workers.  Additionally, the judge decided that the elimination of cost-of-living adjustments or COLAs was also unconstitutional.

As a result, the state is permanently prohibited from implementing these two provisions as far as it applied to employees who were members of the Florida Retirement System (FRS) prior to July 1, 2011.  The judge’s ruling does not apply however to employees hired after said date.

The consequences of the ruling are far-reaching.  It now requires the Legislature to reimburse state workers, with interest, for the deducted funds.  This will add up to roughly a billion dollars in repayment and another billion for inclusion in this year’s budget.

The state’s lawyers vowed to appeal the decision and took solace that the Legislature’s mandate still applies going forward.

For such a significant decision Judge Fulford hardly showed herself.  She walked into a courtroom packed mostly with high-powered union representatives and media, dropped a stack of copies of her legal opinion, and walked out.  The room erupted as interested parties fought over the limited copies.

As the decision became known, Andy Ford, President of the Florida Education Association (FEA), the state’s largest teachers’ union, was swarmed by cameras.  He claimed the decision was “a historic victory for state workers against abusive powers.”

Senate President Mike Haridopolos on the other hand was non-plussed.  From a prepared statement issued through his office, Haridopolos explained, “I am deeply disappointed in Judge Fulford’s decision today.  She has proven once again that she is an activist judge who has no problem overstepping her authority and overruling the decisions of the state’s elected representatives…”

Judge Fulford and Senate President Haridopolos have been through this before.  Fulford was the same judge that ruled against a prison privatization plan from last year’s legislative session, also a priority of Haridopolos.

“The ruling is a radical departure from past precedent.  46 other states already ask state employees to contribute to their own pensions, in fact, [Florida] state employees up until the 1970s, also contributed to their pensions,” said Haridopolos.

The ruling comes as “defined benefit” pensions, or guaranteed pensions, are breaking state budgets all over the nation.  The private sector mostly no longer offers these plans but has instead shifted to the “defined contribution” model, 401(k) being an example.

With just three days before the end of the regular legislative session, lawmakers are now forced to find another $2 billion on top of closing a $1.6 billion deficit.  Luckily, the state has set aside a prudent holding fund to hedge against the adverse ruling.  It’s proved to be a wise move as, according to Floridians for Sustainable Pensions, “government employees may [now] confront job cuts or wind up with unstable retirements or no pension at all.”