Social Security Just Got Better for Public Employees: Here’s How

Key Takeaways Lump sum payments have begun to arrive, and monthly payments are expected to start in April 2025, as WEP and GPO are repealed. WEP: The Two-Job Penalty, No More. Retirees may benefit if they worked in a government job not covered by Social Security and a private-sector job covered by Social Security that was reduced by "WEP". GPO: Spousal Benefits Unlocked. Surviving spouses now benefit if they previously lost their Social Security benefits due to "GPO". The Social Security Administration is now required to provide clearer, earlier notifications to workers who may be impacted by WEP or GPO provisions. Did you receive a notification? Let's discuss how these changes might impact you.

The recently passed Social Security Fairness Act repealed two provisions that paid government workers less, called the Windfall Elimination Provision (WEP) and the Government Pension Offset (GPO). These repealed provisions affected approximately 3.2 million public servants, including teachers, firefighters, and health care professionals. 

Although repealed just weeks ago, many affected individuals have already received a retroactive benefit payment intended to make up for benefits "owed" since January 2024. This lump sum payment averages $6,710 per person and totals $7.5 billion across all recipients. 

Additionally, monthly Social Security benefits for affected individuals are expected to start (or increase from current) in April 2025. 

WEP: The Two-Job Penalty That’s Finally Gone

Imagine you worked two jobs over your career:

• One job where you paid into Social Security (like a private-sector job).
• Another job where you didn’t pay into Social Security (like a teacher or firefighter with a government pension).

Before the recent changes, the government penalized you for having that second job by reducing your Social Security benefits.

Old WEP says, “Because you worked in two different systems, public and private, somehow you deserve less.”

Now, with the repeal of WEP, you get treated like everyone else. You can expect to benefit from Social Security based on what you actually paid in. 

Previously, the WEP used a rigid formula that often led to disproportionate benefit reductions. Under the new provisions:

• The formula now considers a worker’s entire earnings history, making adjustments more gradual and proportional.
• Workers with a longer history of covered employment (i.e., paying Social Security taxes) will see less of a reduction in their benefits.
• The new formula phases in reductions rather than applying an abrupt cut.

GPO: Spousal Benefits Are Now Unlocked

Picture this:

• You and your spouse worked for years.
• Your spouse paid into Social Security their whole career.
• But because you had a government pension, the GPO took away the spousal or survivor benefits that other people in your situation would receive.

Old GPO says, “Sorry, your spouse’s benefits don’t count for you because you worked for the government.”

Now, with GPO gone, the system finally recognizes that a spouse’s benefits belong to their partner regardless of where they worked. Just like everyone else, you can now receive those benefits without reduction.

More GPO Changes for Survivors

• The new rules introduce partial relief for surviving spouses impacted by the GPO.
• Instead of an outright elimination of benefits, some widows and widowers may now retain a portion of their Social Security survivor benefits, depending on their total pension amount.
• This change provides additional support for surviving spouses who rely on a mix of pension and Social Security income.

An Example: Paying the Price Twice with WEP & GPO

John was a teacher for 30 years. Although he didn’t pay into Social Security while teaching, before that, he worked in construction and paid Social Security taxes.

When he retired from teaching, he expected to get some level of Social Security benefits from his years in construction. After all, during his ten years working in construction, 6.2% of his paycheck was deducted each year (and unbeknownst to him, his employer contributed an additional 6.2% to Social Security on his behalf). But because of WEP, his check was slashed, even though he had earned those benefits just like anyone else.

On top of that, years later, after John’s wife passed away, he figured he’d receive spousal survivor benefits like anyone else. But his survivor benefit was eliminated because of GPO.

Now, thanks to the repeal of these provisions, John finally gets the benefits he rightfully earned—no penalties, no reductions.

What Should You Do Next?

If you or your spouse earned a pension for a government job and paid into  Social Security for at least 10 years under a private-sector job, it’s important to review how these changes to WEP and GPO might impact your retirement benefits. While WEP and GPO still exist, the modifications help ensure that benefits are calculated more equitably. 

If you have questions about how these changes affect you, let’s talk. We’re here to help you understand:

• How your benefits might be adjusted ✅
• Whether you could see an increase in your Social Security payments ✅
• What steps you should take to maximize your retirement benefits ✅

📅 Schedule a free Quick Connection time with an Open Window advisor today at www.openwindowFS.com/connection.