President Joe Biden (D) signed the Social Security Fairness Act (SSFA) — authored by Sens. Susan Collins (R) and Sherrod Brown (D-OH) — into law Sunday.
The SSFA will repeal two provisions currently in place — Windfall Elimination Provision (WEP) and the Government Pension Offset (GPO) — that reduce the amount of Social Security benefits for which public employees and their spouses are eligible.
Lawmakers in the House of Representatives approved this bill by a margin of 327-75, while Senate lawmakers passed it 76-20.
These changes will be applicable for benefits paid after December 2023.
PIA — Primary Insurance Amount; YOC — Years of Coverage; AIME — Average Indexed Monthly Earnings
According to the Social Security Administration (SSA), the WEP established a formula used to adjust the Social Security benefits of those who receive “non-covered pensions,” defined as “a pension paid by an employer that does not withhold Social Security taxes from your salary.”
Generally speaking, such pensions come from state, federal, or local government employment, including in schools, law enforcement, and fire departments.
“Congress passed the WEP to prevent workers who receive non-covered pensions from receiving higher Social Security benefits as if they were long-time, low-wage earners,” the SSA explains.
The “WEP guarantee” provides assurance that one will not receive less than half of the benefit amount they otherwise would have, meaning that in some cases, benefits are reduced by a smaller factor than the formula recommends.
Similarly, the GPO adjusts the spousal or widow(er) benefits for those receiving non-covered pensions.
“Congress created the GPO in 1977 to help ensure that spousal and widow(er) benefits of those with covered or non-covered lifetime earnings would be roughly equal,” the SSA writes.
Social Security’s “dual-entitlement rule” reduces spousal benefits “dollar-for-dollar” with one’s own earned benefit, and the GPO is said to have “a similar intention.” Although benefits were originally offset dollar-for-dollar, this was reduced to two-thirds in 1983.
“In 2003, I held the first-ever Senate hearing on the WEP and the GPO, and I am pleased that with today’s signing of the Social Security Fairness Act, these unfair provisions in our Social Security system have finally been repealed,” Sen. Collins said in a statement released Sunday in advance of the signing ceremony.
“This is a victory for thousands of teachers, first responders, public servants, and the countless advocates who fought for years to correct this unfairness,” Collins continued. “For too long, the WEP and GPO have denied retirees and their spouses the Social Security benefits they earned through years of work and contributions to the system. This law ensures that public service will no longer come at the expense of one’s earned retirement benefits.”
Click Here to Read Sen. Collins’ Full Statement
Rep. Jared Golden (D) also issued a statement on the legislation’s passage, expressing support for the repeal of these provisions.
“Public employees such as teachers and first responders provide some of the most essential services in our country,” Rep. Golden said. “For too long, people who paid into Social Security were punished for taking those public-sector jobs by government policies that reduced their Social Security benefits.”
“This law will finally guarantee that they receive the full benefits they earned,”said Golden. “It’s also a testament to these Americans’ relentless pursuit of fairness, and proof that bipartisanship is still possible on Capitol Hill.”
Click Here to Read Rep. Golden’s Full Statement
More than 25,000 Mainers will see their Social Security benefits increased as a result of the SSFA being signed into law.
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These provisions were passed during a Republican administration assuming they would affect mostly federal government employees, who were assumed to be Democrats.