The Social Security Fairness Act, signed into law by President Joe Biden on January 5, 2025, repeals two provisions—the Windfall Elimination Provision (WEP) and the Government Pension Offset (GPO)—that previously reduced Social Security benefits for public-sector employees who also had private-sector earnings.
This law remedies a decades-long problem that prevented many workers in public service from retiring with their full Social Security earnings. So many workers move between the private and public sectors over the course of their careers, and before the repeal of these provisions, the WEP and the GPO penalized these workers on retirement. Now, after years of work by the AFT and many others, fairness has been restored, and these penalties have been eliminated.
Ensuring workers have a fair and secure retirement demonstrates respect for the people who support our communities. And it’s how we recruit and retain the next generation to help our island thrive. This is a huge victory, years in the making, and it would not have been possible without your support.
Background on WEP and GPO
The WEP, established in 1983, adjusted the Social Security benefit formula for individuals receiving pensions from non-Social Security-covered employment, such as certain government positions. This often led to reduced benefits for retirees who had also worked in the private sector. Similarly, the GPO, enacted in 1977, reduced Social Security spousal or survivor benefits for individuals receiving a government pension from non-covered employment. These provisions primarily affected public-sector workers, including teachers, police officers, and firefighters.
Key Benefits of the Social Security Fairness Act
- Restoration of Full Social Security Benefits: By repealing the WEP and GPO, the Act ensures that public-sector employees who also have private-sector work experience receive their full Social Security benefits without reductions. This change acknowledges the contributions of individuals who have served in both sectors.
- Increased Financial Security for Retirees: The elimination of these offsets translates to higher monthly Social Security payments for affected retirees. For instance, removing the WEP is expected to boost monthly benefits by an average of $360 by December 2025. Similarly, repealing the GPO could increase monthly benefits by approximately $700 for recipients based on living spouses, and about $1,190 for surviving spouses receiving widow or widower benefits.
- Positive Impact on Public-Sector Workers: The Act significantly benefits public-sector employees, such as teachers, police officers, and firefighters, who were previously penalized by the WEP and GPO. As of November 2024, over 2 million Americans had their Social Security benefits reduced by the WEP, and more than 650,000 were affected by the GPO. The new law rectifies these reductions, providing fair compensation for their service.
- Enhanced Retirement Planning: With the removal of these provisions, individuals can now plan for retirement with greater certainty regarding their Social Security benefits. This change allows for more accurate financial planning and improved quality of life during retirement.
- Addressing Inequities: The WEP and GPO disproportionately affected lower-income workers and women. By eliminating these provisions, the Act promotes greater equity within the Social Security system, ensuring that all workers receive benefits commensurate with their contributions.
Considerations and Criticisms
While the Act has been praised for correcting perceived injustices, it has also faced criticism regarding its financial implications. The Congressional Budget Office estimates that repealing the WEP and GPO will cost approximately $196 billion over ten years, potentially accelerating Social Security’s insolvency by six months. Critics argue that this could impact the program’s long-term sustainability.
Conclusion
The Social Security Fairness Act represents a significant policy shift, aiming to provide equitable Social Security benefits to individuals with careers spanning both public and private sectors. By repealing the WEP and GPO, the law enhances financial security for many retirees, particularly those in public service professions. However, it also raises important discussions about the future financial health of the Social Security system.
References
AFT: https://www.aft.org/press-release/afts-weingarten-passage-social-security-fairness-act
NPR: https://www.npr.org/2025/01/06/nx-s1-5249689/social-security-fairness-act-biden-signed