There is often confusion for California workers about the difference between their benefits regarding pensions and Social Security upon retirement. This can be a complicated matter, and these differences can cause an employment dispute if not handled correctly. The following article could give a brief understanding of the two retirement annuities.
First, Social Security benefits, as they stand, are basically calculated on how long a worker has been in the workforce and how much he or she has earned, and when he or she retires. For most, Social Security taxes are automatically withheld by their employers. However, for non-government workers in some states, this is not the case. And this can be a shock for some upon retirement.
On the other hand, pension plans are (sometimes) offered and maintained by employers in addition to Social Security benefits. Pension plans were much more prevalent several decades ago, but still exist in some sectors of the workforce. Many workers today receive both a monthly pension check and a Social Security check. There are times, however, that workers' Social Security benefits could be affected by their pensions.
The most important aspect that determines if workers' Social Security incomes will be decreased by a pension is if workers' employers did not withhold Social Security taxes from their paychecks over the years. There are two main rules that can affect how a person's benefits are determined: The Windfall Elimination Provision (WEP) and the Government Pension Offset (GPO). If not identified or filed correctly, both of these provisions can have a significant result on a worker's expected retirement income.
As with any government programs, the amount of complexity can be tremendous. Many in California may wish to file an employment dispute if they feel that they have been wronged. In these cases, it may be wise to seek the advice of an employment law attorney who can evaluate the many intricacies of this matter. The attorney can then advice his or her client on the best legal options available.
Source: FindLaw, "Your Pension and Social Security Benefits", Accessed on Nov. 22, 2016