New or returning employees with less than 5 years of service have to pay 5.5 times more than existing or vested employees (0.8% vs 4.4%) for the *same* retirement benefit.
At the same time, Congress voted to increase their pension by 70% by only paying an additional half percent.
This is not the last attempt to erode the pocketbooks of Federal employees: two bills currently in Congress seek to change the formula from ‘high-3’ to a ‘high-5’ and increase the ‘Retirement Tax’ for ALL Federal employees to 6.6%.
A bill has been introduced in the House by Rep. Donna Edwards, modeled after her H.R. 5338, that would eliminate the Retirement Tax and return the contributions to their pre-Great Recession levels. It is funded by closing Corporate Tax Loop holes for headquarters operating oversea.