Lawmakers seek to limit ‘pension spiking’

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Two new measures introduced by Democrats take aim at state workers boosting their final state salary to increase their lifetime pension benefits -- a practice known as ‘pension spiking.’

A state employee’s pension benefits are determined by their highest annual state salary. The new bills seek to eliminate the practice of offering promotions and pay raises to employees on the verge of retirement to boost their lifetime pension payout.

‘The rules now in place encourage employees to game the system,’ State Sen. Joe Simitian (D-Palo Alto) said in a statement Thursday.

Simitian has introduced SB 1425, which aims to curtail pension spiking by preventing employees from boosting their final salary before retirement by cashing out on vacation time or administrative leave, among other things, in order to get a higher payout.

A similar measure has been introduced by Assemblyman Ed Hernandez (D-La Puente).

-- Anthony York