Background
Federal laws, including the Retirement Equity Act of 1984 and the Civil Service Retirement Spouse Equity Act of 1984, require most public retirement plans to treat spouses, former spouses, and surviving spouses more equitably. However, there are still some gaps in many public retirement systems, especially in the event of divorce, and certain large groups are not covered by legislation that further protects spousal rights. About half of the states lack adequate protections for surviving spouses of state and local government workers, and about one-fourth fail to protect spouses in the event of divorce. Former spouses have fewer rights under some public retirement plans than they do under private retirement plans governed by the Employee Retirement Income Security Act The Employee Retirement Income Security Act sets minimum standards for pension and welfare plans in the private sector and requires private employers to meet these standards for their plans to be eligible for tax-favored status. ( ERISA The Employee Retirement Income Security Act sets minimum standards for pension and welfare plans in the private sector and requires private employers to meet these standards for their plans to be eligible for tax-favored status. ). For example, in some cases, plans give former spouses smaller benefits or none at all regardless of the length of the marriage.
SPOUSAL RIGHTS IN PUBLIC RETIREMENT PLANS: Policy
Protecting spouses
The laws governing state and local retirement funds should be amended where necessary to provide surviving and divorced spouses of public retirees with at least the same protections that the Employee Retirement Income Security Act The Employee Retirement Income Security Act sets minimum standards for pension and welfare plans in the private sector and requires private employers to meet these standards for their plans to be eligible for tax-favored status. ( ERISA The Employee Retirement Income Security Act sets minimum standards for pension and welfare plans in the private sector and requires private employers to meet these standards for their plans to be eligible for tax-favored status. ) affords to spouses of private retirees.
Further protections for spouses and former spouses of federal workers are needed. For example, policymakers should establish greater protections with respect to including the prospective division of retirement and survivor benefits for previously excluded military spouses and other unprotected groups.
Adequately funded systems that lack or have inadequate health and life insurance coverage for surviving spouses and eligible dependents should initiate or expand and appropriately fund such coverage.
State divorce laws should consider as marital property all retirement benefits and provide for their equitable division.