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Union of American Physicians & Dentists
UCOP’s Newest Wrong-Headed Move: Undermining Your Pension

Sign our petition to show the Regents that UC employees are united against pension cuts!

In late 2012, Governor Brown and a few legislative leaders emerged from closed-door meetings to announce an overhaul of pension benefits for public employees hired on or after January 1, 2013. The Public Employees Pension Reform Act (PEPRA) reduced the retirement factors used to determine a retiree’s monthly pension amount. But much worse for doctors, PEPRA imposed a limit to pensionable salary that is significantly less than what doctors earn.

For example, in 2015, public workers covered by PEPRA had a pensionable compensation limit of $117,000.  Thus, for most state and county doctors hired in 2013 and after, their pension will be calculated as if they earn $117,000, even if their actual salary is $50,000 higher or more.  While the cap will be adjusted for inflation each year, it will always remain much lower than a doctor's salary.

Employees at UC were exempted from PEPRA, so that until now, student health doctors have not been subject to these limits on retirement benefits.

Unfortunately, the political popularity of scapegoating public employees in the name of fiscal responsibility continues. In a budgetary deal with the governor last year, Janet Napolitano agreed in principle to force PEPRA compensation limits on all UC employees hired in 2016 and after. In addition, UCOP is seeking a “Defined Contribution Choice” Plan, whereby new employees would be able to opt-out of the pension altogether, contributing instead to a 401(k)-type plan.

The Problem for Us

In those State and County agencies already covered by PEPRA, reduced pension benefits have made recruiting new doctors even more difficult than before. With the nationwide shortage of primary care physicians and psychiatrists, UCRP will no longer be an effective recruitment tool for student health if these cuts take place. In addition, reducing the number of employees paying into the system would undermine the financial stability that the pension fund needs to keep its promises to current and future retirees.  

Nevertheless, a new pension task force appointed by President Napolitano is recommending that the Regents implement the pension cuts laid out in PEPRA and allow hires to opt out of the UCRP plan entirely.  By their own estimates, about 40% of new employees would decline to participate in the reduced UCRP plan, creating a significant risk that the plan will become underfunded and unstable. 

What Can Be Done?   

First, sign our petition to show the Regents that UC employees are united against pension cuts!

Second, contact your UAPD representative if you can attend the upcoming Regents meeting on Thursday, January 21 at 8:00am, UCSF Mission Bay:

 
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