Social Security Delays Retroactive Payments For Public Workers—Here's What You Need To Know

Then-President Joe Biden signed the Social Security Fairness Act into law on Jan. 5, effectively increasing and retroactively paying back Social Security benefits to public sector workers who have seen reduced benefits for decades. 

However, the payments under the new law are facing delays, leaving nearly 3 million affected retirees in limbo. Here's what you need to know about the delays and what they mean for public sector retirees. 

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What Is the Social Security Fairness Act?

The Social Security Fairness Act eliminates two key provisions that previously reduced Social Security benefits for public sector workers:

• The Windfall Elimination Provision (WEP) reduced Social Security benefits for those who receive a government pension from a job that did not contribute to Social Security payroll taxes.
• The Government Pension Offset (GPO) reduced spousal and survivor benefits for retirees with non-covered government pensions by two-thirds, in some cases eliminating benefits entirely.

These provisions affected retired teachers, police officers, firefighters, postal workers, and other government employees. The law was intended to restore full benefits to these retirees and provide retroactive payments dating back to January 2024.

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Why Are Payments Being Delayed? 

The Social Security Administration (SSA) has said that processing these benefit adjustments could take more than a year due to staffing shortages and lack of dedicated funding. 

“SSA’s ability to implement the law in a timely manner and without negatively affecting day-to-day customer service relies on funding,” the agency said. “The Act did not provide money to implement the law.”

Additionally, the agency said that recalculating benefits is a complex process that requires manual adjustments on a case-by-case basis. SSA must account for past cost-of-living adjustments, spousal benefits, and various pension amounts when determining the correct payment for each affected retiree.

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How Much Money Could Retirees Receive? 

Under the law, the amount of additional money public sector retirees will receive varies based on several factors. Some retirees may only see a modest increase, while others could receive over $1,000, according to the SSA. 

The Congressional Budget Office reports estimates that by eliminating WEP, 2.1 million retirees could see an average increase of $360 per month and that repealing GPO could increase benefits by $700 per month for 380,000 spouses and by $1,190 for 390,000 surviving spouses. 

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What's Next? 

As the SSA faces significant logistical hurdles in processing these new payments, they urge retirees to remain patient. The agency has prioritized processing new claims and is making updates and developing automated systems to speed up recalculations. However, beneficiaries should prepare for extended wait times when contacting the SSA for updates. 

The backlog could impact more than just those impacted by the law. The SSA warns that the 68 million Social Security beneficiaries who currently receive payments could see delays in services. 

For frequently asked questions and updates regarding the Social Security Fairness Act, retirees are encouraged to check the SSA's website. 

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