Takeaways

• New legislation signed by President Biden will boost monthly benefits for nearly 3 million public sector employees in 26 states.

• The "Social Security Fairness Act" abolishes two decades-old rules that have reduced or altogether axed benefits for some retirees.

The Social Security Fairness Act addresses long-standing complaints by public service employees regarding some provisions of the Social Security Act, primarily the Government Pension Offset (GPO) provision and the Windfall Elimination Provision (WEP). These provisions, which were intended to prevent double-dipping into Social Security benefits, have been criticized by public sector employees for reducing or eliminating Social Security benefits for public sector employees (because they already had a government pension plan), including teachers, police officers, and firefighters, as well as family members, such as their spouses or survivors.

The Social Security Fairness Act

The Social Security Fairness Act was signed by President Biden on January 6, 2025. The Social Security Fairness Act is retroactive to the beginning of 2024. The legislation will affect nearly 3 million public sector employees nationwide, permitting them to double dip once again.

Per its website, the Social Security Administration is evaluating how to implement the Act and will provide more information when it becomes available.

Understanding the Repealed Provisions

Government Pension Offset Provision

The GPO often reduced Social Security benefits for spouses, widows, and widowers who had government pensions of their own. For many public sector employees, this provision eliminated spousal or survivor Social Security benefits, meaning spouses and survivors with their own federal pensions could not ALSO collect on a former or deceased spouse's social security account as well.

Windfall Elimination Provision

The WEP reduced Social Security benefits for individuals who receive a pension from employment not covered by Social Security. Though designed to address unfair advantages for individuals with earnings from both Social Security-covered and noncovered employment, public sector employees argued that the WEP formula often resulted in overly severe reductions, "penalizing" individuals who worked in public service roles.

Other Repealed Provisions

The Social Security Fairness Act also repeals provisions that reduce Social Security benefits for individuals who receive other benefits, such as a pension from a state or local government.

The Effect on Public Sector Workers

The WEP and GPO affect millions of public sector employees in states where public pensions substitute for Social Security.

Goals of the Social Security Fairness Act

Public sector employees assert they they should not be penalized for earning pensions through their work while also benefiting from Social Security through other jobs. The Social Security Fairness Act now ensures that public sector retirees receive the full Social Security benefits they earned, providing a more "equitable" retirement system. They say that repealing WEP and GPO will also simplify the Social Security benefits system, reducing confusion and administrative burdens.