Do Changes in Benefits for Public Employees Violate the Contracts Clause?
Paul Secunda has a new paper on SSRN that considers under what circumstances statutory changes affecting public-employee benefits might violate constitutional restrictions on the impairment of contracts. Paul particularly focuses on a very timely case study: Wisconsin’s recent budget-repair bill and its impact on city employees in Milwaukee. Here is the abstract:
The recent spate of high profile efforts by state governors to roll back public employee pension rights in light of recent budgetary challenges has shone the light directly on the importance to public employees of the Contracts Clause provisions of the federal and state constitutions. Using as an example the controversial budget repair bill in Wisconsin and the application of the bill’s pension provisions to Milwaukee City employee pension rights, this article has sought to show how, under certain specified circumstances, such legislative attempts may be constitutionally impermissible if such laws substantially impair employee contracts with the state without the necessary legal justification.