The New York State Bar Association (NYSBA) is advocating for passage of a law that would make it more likely that the pension of a public employee continues to pay out until the surviving spouse dies.
The association’s House of Delegates on Jan. 19 approved a recommendation from its Trusts and Estates Law Section that the association support the Equity for Surviving Spouses Act. The act would set the default benefit for the eight New York pension plans to a joint and 50% survivor annuity. The benefit would last for the spouse’s lifetime and pay out half of the employee’s pension payments. The default right now is that the pension payments end with the employee’s death.
“It is imperative that spouses of public employees have access to survivor benefits to ensure the economic stability of themselves and their immediate family. This is especially true for those families with children or in instances where a large wage gap exists between spouses. The absence of such benefits could cause irreparable harm to their well-being at a time when they are most vulnerable following such a tragedy,” said Richard Lewis, president of the New York State Bar Association.
The default under the Equity for Surviving Spouses Act is that the spouse be the beneficiary. The act will allow for the selection of a smaller payment to the surviving spouse if the spouse consents in writing.
Forty-five states have public pension plans that make the surviving spouse the beneficiary of the default joint and 50% annuity or require consent for the employee to choose another benefit or designate another individual as the beneficiary. Two other states have plans that require the spouse to be given notice of the employee’s benefit selection.
New York, Tennessee, and Alabama are the only states that do not have public retirement plans with these protections.
David Alexander is a content and Communications Specialist at NYSBA.
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