Public employees who've been convicted of felonies that breach the public's trust will lose some retirement benefits under a new Michigan law.
The law enacted Wednesday requires a public employee or retiree to relinquish accumulated employer contributions toward a retirement benefit if convicted of crimes like misusing funds or taking bribes. Michigan law had previously allowed for the forfeiture of benefits if a public employee was convicted of such crimes, but the new rule requires it and extends the penalty to a convicted worker’s 401(k) — not just their pension.
"Protecting the integrity of retirement contributions employers make is critically important," Governor Rick Snyder said in a release after signing the the legislation sponsored by White Lake Republican Rep. Jim Runestad.
The law comes as Michigan Attorney General Bill Schuette tries to take away the pensions of 12 former Detroit Public School officials convicted in a $2.7 million kickback scheme.
Schuette in October initiated civil forfeiture actions aiming to take away all DPS contributions from the time the bribery began until the time the employees were terminated or retired.