Court Opinion

ID: 9749129
Source: CourtListenerOpinion
Date Created: 2023-08-27 16:24:38.090919+00
Date Added: 2024-06-11T07:25:44.252232
License: Public Domain

FLAHERTY, Justice,
concurring.
I join the Concurring Opinion authored by Mr. Justice Larsen and concur in the result reached by Mr. Justice Roberts but feel it necessary to write separately inasmuch as the reasons advanced for the conclusion reached fail to recognize that upon entry into the fund, the terms by which the retirement benefits accrue are contractually fixed. When the Commonwealth seeks unilaterally to modify that contract, it does so in violation of Article I, Section 17 of the Constitution of the Commonwealth of Pennsylvania which prohibits the passing of any law impairing the obligation of contracts.
That retirement benefits are contractually grounded was soundly recognized by this Court in Baker v. Retirement Board of Allegheny County, 374 Pa. 165, 97 A.2d 231 (1953) where it was stated that “[a]s of the time [the employe] joined the fund, his right to continued membership therein, under the same rules and regulations existing at the time of his employment, was complete and vested. The legislature could not thereafter constitutionally alter the provisions of *337his already existing contract of membership. His rights in the fund could only be changed by mutual consent.” Id., 374 Pa. at 169, 97 A.2d at 233.
Retirement benefits are not a gratuity; they are deferred compensation and should be viewed as such. To change the terms by which retirement benefits are a calculated strike at the heart of the compensation package.
The terms in effect on the date of hire are for all times the terms to which both parties are bound absent a modification by both parties. Regardless of length of service, the Commonwealth cannot unilaterally diminish the benefits or terms of the contract which the parties executed. Undue emphasis is placed by the majority opinion upon the fact that as of the change in 1972, the appellees had both attained ten years of service and that benefit had “vested” and were both over age sixty. Having served the Commonwealth for ten years, however, is not a condition to contractual obligation; that is already accomplished by making contributions. A threshold requirement of ten years service is a condition to be fulfilled before the employe has the option of separating from service while leaving the contribution intact and active. It is not determinative of whether he has a valid contract with the state or of what the terms of that contract are. This is determined by the retirement code in effect on the date service begins.