AB 1667 Shields Retired Teachers from Benefit Clawbacks, Increases Transparency

Retired teachers across the State of California receive pension payments from the California State Teachers’ Retirement System (“CalSTRS”). But when they receive mistaken overpayments from CalSTRS—sometimes over a period of years—do they have to pay those overpayments back to CalSTRS? 

Assembly Bill 1667, signed by Governor Newsom at the end of September 2022, answers that question. Overpayments that are the fault of a teacher-retiree’s former employer, a county superintendent of schools, or CalSTRS will not be clawed back from the teacher-retiree. Accordingly, the Bill shields teacher-retirees from returning overpaid amounts to CalSTRS, especially when they have little reason to know that they received an overpayment in the first place.

AB 1667 also includes measures to ensure that contributing employers pay what they owe toward teachers’ retirement benefits by authorizing CalSTRS to issue publicly available advisory letters related to compensation and reporting and prescribing certain audit procedures for identifying lapses in contributions or related information.

For more information about this new law or others, please contact your labor law counsel.