New York Attorney General Investigating “Manipulation” Of Government Workers’ Salaries

The Wall Street Journal reports that New York Attorney General, Andrew Cuomo, said on Thursday that he is investigating a pension “spiking” case in the state. Pension “spiking” refers to large increases in salary of a government worker just when he is about to retire. This practice gives boost to the worker’s lifelong pension payout. Cuomo has called such practice “manipulation” of government workers’ salaries.

Pension spiking is allowed in most places legally. However, the practice has faced criticism in the last two years, with states such as California, Massachusetts and Georgia considering a ban on the practice.

Cuomo, citing recent census data, said that New York state had a pension cost $486 for each of the state’s residents. This is the highest in the U.S.

Citing an example of a police officer, who has a salary of $74,000, he said a police officer’s earnings can be $125,000 from overtime in his final years of service, which takes his total salary in his final years to $200,000 and boosts his pension payout as it is calculated taking into account the salary from the last few years’ service. "You can see how quickly these numbers get large," he said. Cuomo’s office is writing to 28 state agencies and local governments in order to obtain payroll information.