A bill that eliminates the impacts of COVID-related work slowdowns on public employee pensions has passed through the Legislature and was signed into law by Governor Inslee last week.

We first wrote about SB 5021 when it was introduced. The bill makes sure that the average final salary for public employee retirement systems includes compensation forgone by employees because of reduced hours, mandatory unpaid leave, temporary layoffs, furloughs, or similar measures from the COVID-19 crisis for the current and next biennia. It also eliminates any penalty for current and former employees whose hours were reduced because they were in a shared work program. The bill impacts LEOFF plans 1 & 2; PSERS; and PERS plans 1, 2, & 3; among others. Similar measures to shore up pensions were taken after the Great Recession. SB 5021 is retroactive, so it will remedy pensions that have already been impacted by reduced work hours during 2020 and 2021.

No amendments were adopted to the bill on its journey through the Legislature. It originally passed out of the Senate in late February on a 29-20 vote and passed the House on March 24 on a 65-32 vote. Governor Inslee signed the bill into law on April 7.

SB 5021 is effective 90 days after Sine die, around July 25.