Babauta: Potential unauthorized collection of OT pay calculations from retirees’ benefits
Sen. Celina R. Babauta (D-Saipan) has expressed concern regarding the apparent potential unauthorized collection of overtime pay calculations from benefits received by the retirees of the NMI Retirement Fund and their eligible survivors’ benefits.
Babauta urged NMI Settlement Fund trustee Joyce C.H. Tang to cease any alleged unauthorized collection of overtime from retirees’ or their eligible survivors’ benefits.
“Any such actions should be brought before the court for approval to ensure adherence to the terms of the settlement and protects the rights of the settlement class,” said the senator in her letter to Tang last Monday.
She recalled that Betty Johnson’s class action against the CNMI government in 2009 resulted in a settlement agreement intended to fully resolve all disputes related to the CNMI government’s failure to properly fund the NMI Retirement Fund.
Babauta said as she understands it the settlement agreement encompassed all potential claims, including those related to overtime pay,
She said the settlement agreement clearly outlined all agreed-upon compensations which included a revision of benefits for the settlement class while preserving their constitutional rights to accrued and unimpaired benefits.
Therefore, the senator said, any additional deductions from retiree benefits, such as overtime collection, would require prior court approval from the federal court that oversaw the settlement.
Babauta said pursuant to the settlement agreement, specifically 4.4 Minimum Settlement Fund Balance, states that “Notwithstanding the provisions of paragraph 4.3, if the trustee determines that the Settlement Fund is within 30 days of having a low balance, the trustee shall give notice of a low balance to the CNMI.
She said “the notice shall include a statement of the amount necessary to make bi-weekly payments to settlement class members in the amount of 75% of their full benefit payments.”
Babauta said if there is no published notice of a “low balance” required by Section 4.4 of the settlement agreement then, a diminished retirement pension is unnecessary.
In 2013, U.S. District Court for the NMI designated Judge Frances Tydingco-Gatewood gave final approval to the global settlement agreement in Johnson’s class action against the CNMI government and the NMI Retirement Fund.
Under the global settlement, the CNMI agrees to make annual payments that will enable the settlement to fund at least 75% of class members’ benefits.
With the court’s final approval, all NMI Retirement Fund assets were transferred to the Settlement Fund, as administered by Tang as a court-appointed trustee.
Celina R. Babauta
