DWP union sues city of L.A. over pension double-dipping

The union representing Los Angeles Department of Water and Power workers is suing the city for allowing employees who retired from other city departments to work at the utility while collecting a pension.

The lawsuit, filed Tuesday by International Brotherhood of Electrical Workers Local 18, argues that the city charter prohibits those who retire with a pension through the Los Angeles City Employees’ Retirement System from subsequently working as a DWP employee.

The city attorney’s office last year took the position that the retired city employees can join the DWP, according to the lawsuit.

But the charter’s prohibition against working as a “city employee” while collecting a LACERS pension includes DWP jobs, not just jobs elsewhere in the city government, the lawsuit said.

The city charter includes three pension systems: the Water and Power Employees’ Retirement Plan, the Los Angeles Fire and Pension System and LACERS.

IBEW officials worry that a flood of retired city employees will sign on at the utility, which often pays more than other departments. Because of their experience, they can start at a high level, drawing a salary and their LACERS pension, then retire again and collect pensions from both LACERS and the Water and Power plan.

California

‘DROP on steroids.’ L.A. city workers double dip by retiring and getting hired at DWP, union alleges

The union representing LADWP workers accuses the city attorney of letting city employees “double dip.” The city attorney’s office says it isn’t “unlawful.”

March 15, 2024

The union also argues that the issue must be addressed through collective bargaining.

“The taxpayers and ratepayers of Los Angeles are the same people, and they will pay the price if this decision is allowed to stand — it triggers the most extreme ‘double-dipping’ scenario any municipality has ever seen,” IBEW Local 18 head Gus Corona said in a statement.

In a cease-and-desist letter to City Atty. Hydee Feldstein Soto dated March 11, Corona called the situation “DROP on steroids” — a reference to a police and firefighter program that allows participants to collect their salaries and pensions simultaneously for the last five years of their careers.

As of May, seven DWP employees received a LACERS pension, while an additional 81 to 253 DWP employees are eligible to do so. Another 1,700 DWP employees will become eligible in the future, according to the lawsuit.

The transition isn’t as easy for employees making the reverse move. Under DWP rules, a retired employee may seek another city job only after six months and must start as a new employee, working for at least five years before their LACERS pension vests, according to an IBEW representative.

Ivor Pine, a spokesperson for the city attorney’s office, declined to comment on the lawsuit.