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West Retirement
Jeanne West, left, gets a hug from her friend and co-worker Diane McNeill at her retirement party at Fayze's Restaurant in La Crosse on Friday. West, a state probation agent, accelerated her retirement because of the potential loss of benefits.

Across Wisconsin, government and school district employees are weighing whether to continue working or get out of public sector employment in light of a new law limiting collective bargaining and employee benefits.

Some retired even before Republican Gov. Scott Walker took office, anticipating changes in employee benefits. Others began rushing to do so after Walker last month unveiled his plan to end most collective bargaining for public workers and require them to pay more of their health insurance and pension costs, a proposal he signed into law last week.

With nearly 20 years in the job and a generous retirement plan, La Crosse probation officer Chip DeNure, 61, figured he didn't need to work a few extra years to boost his pension payout.

"I'd planned to work until 65, but all of this happened so fast and the next thing you know I'm out the door," he said. "I retired at the end of the day Feb. 28 after my supervisor put the (employee) contract book in the trash."

Fellow probation officer Jeanne West, 64, worried about losing health care benefits if she waited to retire. The 21-year veteran's departure March 10 left her office with nine agents, down from 11.

Retirement applications spike

Public employees have an incentive to stay in their jobs until they are 65 because their pensions will be higher. And the longer they work, the more sick leave they earn, a benefit that can be banked and converted into cash for health insurance after retirement.

A lobbyist for county governments says he's heard of no broad move by county employees to retire. But schools, UW-Madison and the state are seeing big increases in the number of workers retiring or thinking of doing so.

As of March 11, the 2,741 retirement applications received by the state retirement system since the start of the year was 66 percent higher than during the same period in 2010, according to the Department of Employee Trust Funds. The 9,370 employees this year who have asked for formal estimates of the amounts they'd receive if they retired is more than double that of the same period last year.

At UW-Madison, 205 people retired between December 2010 and mid-March, a 48.6 percent increase over the same period a year ago.

Officials have been warning for years about impending retirements because a quarter of public workers in the state are of retirement age.

"The baby boom generation is turning 65 this year, so we have been suggesting for a number of years the wave is coming," said Bob Conlin, deputy secretary of the state Department of Employee Trust Funds. "The number of people eligible to retire increases every year, and usually what you need is some sort of catalyst."

Governor tracking retirees

Cullen Werwie, a spokesman for Walker, said the governor has asked the Department of Administration to track the retirements of state workers but that it's too early to say what impact they will have on the state budget. There are about 76,000 state workers, 40,000 of whom work for the University of Wisconsin System.

West said she was planning to retire at the end of the year but accelerated the move because she feared losing health care benefits in retirement if the collective bargaining changes were enacted and she had to work under a new contract.

Most state employees earn 16.25 sick days each year, Conlin said. Unused sick days can be cashed in upon retirement to pay for health insurance that often bridges the gap between employment and Medicare.

Health care questions are also driving teachers and school employees to consider retirement under the terms of their current contracts, many of which pay health insurance costs until a teacher qualifies for Medicare, said Dan Rossmiller, a lobbyist for the Wisconsin School Boards Association. The practice dated to the 1980s, he said, as districts sought an incentive for higher-salaried teachers to retire.

Workers who retire under the terms of their current contracts are entitled to the health and pension benefits in the contracts, said lawyers who specialize in constitutional and employment law.

"The constitution doesn't permit the state Legislature to impair contracts," said Carin Clauss, emeritus law professor at UW-Madison. "You can't take away what I've already earned. You could, of course, change it for the future."

Is this what Walker wanted?

West said she couldn't afford risking having her benefits changed.

"I loved my job, although the workload was always excessive, and I regret that leaving in such a hurry is leaving so much of my undone paperwork for my already overworked co-workers to do," West said in an e-mail elaborating on her decision. "I believe that I am doing exactly what Gov. Walker wants us longtime state employees to do: leave now and save money for the state because we old-timers do receive somewhat larger paychecks than the rookies."

Werwie rejected that assertion.

"Gov. Walker has never asked public employees to retire," he said in an e-mail. "Gov. Walker is solely interested in moving Wisconsin forward and ensuring the best and the brightest are in government service. The reforms contained in the budget repair bill will help ensure that local units of government and school districts are able to reward their best employees regardless of age."

 

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