The board overseeing the pension plan for Washington’s police and firefighters recently dismissed concerns about potential overtime abuse.
At a meeting late last month, a board researcher blamed increased overtime on staffing shortages and one board member brushed off the idea that employees manipulate the pension system — despite a lack of statewide data that could document abuses.
Ultimately, the Law Enforcement Officers’ and Fire Fighters’ Plan 2 board voted against investigating public employees’ boosted overtime pay.
Sometimes called “pension spiking,” it's the act of inflating pensions by sharply increasing late-career pay, often through heavy overtime.
An April Seattle Times investigation revealed some Seattle police officers and firefighters worked significantly more overtime as they neared retirement, generating at least an estimated $158 million in additional pension obligations for taxpayers and other pension plan members.
Public pensions are funded by contributions from employees, their employing agencies and the state, plus investment returns.
Following the reporting, the pension board requested a briefing, said Steve Nelsen, the board’s executive director.
At the Sep. 24 briefing, the board’s research manager attributed increased overtime to police and fire department staffing shortages, and indicated that statewide data didn't show a late-career overtime trend.
The presentation appeared to satisfy state Sen. Jeff Holy, R-Cheney, one of the board members.
“Part of it has to do with the fact we can't hire cops,” Holy, a former police officer, said at the meeting. He didn’t think police officers and other employees were trying to “manipulate the system,” he added. Instead, he blamed “staffing issues” and union contracts for jumps in overtime.
But the data used by the board didn’t break down employee pay categories, so it couldn’t show how much pay was attributed to overtime. The data was not “as robust as it could have been,” Nelsen said in an interview.
The Times was able to determine overtime’s role in pensions because it obtained compensation data — and how much of it came from overtime — through public records requests to the Seattle fire and police departments, and three more city agencies.
The analysis showed the trend of increased late-career overtime predated the steep staffing shortages that began in 2020, when the pandemic and social protests were followed by large numbers of officers and firefighters leaving the force.
Nelsen said the board is more concerned about higher-than-expected salaries driven by inflation, and increased overtime across all employees — instead of a particular group of employees. The board is composed of three firefighters, three police officers, three employer representatives and two legislators.
Also, Washington’s retirement system is among the best funded in the country, a fact that has relieved pressure for pension reforms. In California and other states that have restricted overtime in pension calculations, the systems faced mountains of unfunded pension liabilities.
Nelsen acknowledged that it's not possible for the board to identify local public safety employees who consistently use more overtime near the end of their careers. To know that, the state would need payroll data broken down by overtime, like that obtained by The Seattle Times. But public employers in Washington are only required to report each employee’s total salary. Changing the reporting would require legislative action.
Spokespersons from both the Seattle fire and police departments acknowledged to The Seattle Times earlier this year that some employees boost their pensions by working extra hours late in their careers. Not all officers and firefighters in the data increased their overtime hours late in their careers — some reduced them — but nearly twice as many increased them as those who did not.
The last time the pension board discussed the practice of boosting late-career overtime was in 2014. The board’s staff warned that individual cases of salary spiking can occur, undermining “public trust that the plan is designed responsibly and managed professionally.” However, the analysts concluded that pension spiking did not impose significant systemwide costs.
Board members, as they did last month, chose not to take further action.
© 2025 The Seattle Times. Visit www.seattletimes.com. Distributed by Tribune Content Agency, LLC.
