Disability Benefits For Retired Firefighters Can Be Tied To Wage Reductions

A group of disabled firefighters sued the City of Newburgh, New York, claiming the City had unlawfully reduced their disability benefits. The firefighters receive “performance-of-duty disability retirement allowances” from the New York State Retirement System as well as supplemental benefits from the City in the amount of the “difference between the amounts received under their allowances and the amount of their regular salary or wages.”

On January 10, 2011, the City entered into a new contract with its firefighters’ union pursuant to which the salaries paid to active firefighters were temporarily decreased. Firefighter wages were reduced by 5% for the period from January 14, 2011, through June 30, 2013, and by 3% for the period from July 1, 2013, through December 31, 2013. The City then notified the retired firefighters that their supplemental benefits would be reduced in accordance with the new contract.

An appeals court upheld the City’s decision. The Court found that an employer “is obligated to pay only the difference between the amounts received under such allowance or pension and the amount of his or her regular salary or wages. The amount of a pensioner’s regular salary or wages is calculated based on the current salary of an active firefighter at the same grade the pensioner held upon retirement.

“Thus, the term ‘regular salary or wages’ includes salary increases given to active firefighters following the award of the disability retirement allowance or pension as well as the benefit of longevity pay increases provided to active firefighters. ‘Regular salary or wages’ also includes salary decreases applied to active firefighters following the disability retirement allowance or pension award.”

Whitted v. City of Newburgh, 126 A.D.3d 910 (N.Y. A.D. 2015).