State Employees Score Double Victory In Court

State employees scored a double victory Friday, as judges ruled Illinois' pension law unconstitutional and ruled state retirees will receive refunds from a similarly unconstitutional healthcare law. 

A pension overhaul passed by the General Assembly last year aims to cut state employees' retirement benefits, and raise the retirement age. But Springfield circuit judge John Belz ruled the entire law unconstitutional, siding with state employees that their pensions and benefits are protected under the state's constitution.

State workers have long argued that "a pension is a promise," and that the pension law's cuts are "pension theft." University of Illinois professor Bruce Reznick, who's taught math at the school for 35 years, says the state's pension system is what attracted him to the job in the first place.

"The pension is part of the contracted compensation for the work that we did to help build the University," he said. "And if the state tries to weasel out of what's promised, then that makes it much harder to persuade new people that this is a reliable employer."

After the pension law's ruling, another judge directed the state to refund $60 million to the 75,000 retirees who have been paying a portion of their health insurance for the last year and a half. That law was ruled unconstitutional this summer, and the money has been held in escrow.

Judge Steven Nardulli on Friday scheduled a Dec. 18 hearing to establish how to distribute more than $60 million to the retirees. Attorneys estimate the money will be returned by spring.

Retirees began paying a percentage of their annuity under a 2012 law.

A state Supreme Court ruling this summer found the law unconstitutional because promised benefits cannot be altered. The state ultimately decided not to fight the retirees’ motion to return the money.

Linda Brookhart, executive director of the State Universities Annuitants Association, says it's a happy day for state workers.

"We've had two victories here, you might say, it's to the public employees and retirees benefit, and hopefully that many things will continue to be settled and people will not have to continue to worry about where their benefits are going," she said. 

But state workers will have to hold their breath once more, as the case will be appealed to the Illinois Supreme Court.