Monthly Archives: April 2013

Florida: State Employee Raises v. Total Compensation Reduction

An article in The Florida Current reports that the Florida legislature has come to an agreement to give career service state employees a raise — the first in almost seven years. Career service workers earning more than $40K a year would see a $1K increase, and those earning less than that would get a $1.4K increase.

It’s not much, for sure, but it is a step in the right direction.

A definite step in the wrong direction was the State Supreme Court blessing the money grab labeled as “pension reform” earlier this year. In 2011, career service employees, then five years from any general raise in salary, were mandated to contribute 3% of their salary to the pension plan. Gov. Rick Scott cited common practice in private industry and other states of requiring employee salary contributions to retirement plans in pushing for this change, but nowhere was it said that it was common practice anywhere to reduce employee total compensation unilaterally. Instead of increasing funding to the pension plan, the state simply reduced its total contribution to the pension plan, effectively reducing employee total compensation.

The two countervailing results can be tallied up together to yield an effective compensation change value now.

Salary Reduction in total compensation Raise Effective compensation change
10000 -300 1400 1100
15000 -450 1400 950
20000 -600 1400 800
25000 -750 1400 650
30000 -900 1400 500
35000 -1050 1400 350
40000 -1200 1000 -200
45000 -1350 1000 -350
50000 -1500 1000 -500
55000 -1650 1000 -650
60000 -1800 1000 -800
65000 -1950 1000 -950
70000 -2100 1000 -1100

If you are a career service state employee making less than $40K per year, the legislature’s proposed raise will provide more positive change in compensation than the “pension contribution” reduced it. If, though, you are making more than $40K per year, the amount of the the salary raise is less than the total compensation amount removed by the “pension contribution”; you are still effectively in the hole or underwater or whatever term might apply to this form of being shafted by your employer.

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