Oklahoma Gov. Mary Fallin has signed legislation that ends the traditional pension retirement system for newly hired state employees in favor of a 401(k)-style retirement plan.

Fallin signed the measure into law on Friday. The bill moves future state employees from a defined benefit plan to a defined contribution plan similar to private sector plans.

It exempts teachers as well as state workers who are designated “hazardous duty” including firefighters and law enforcement officers. It does not change the pension system for current employees or retirees.

The bill affects employees hired after Nov. 1, 2015, who are part of the Oklahoma Public Retirement System. It will phase out the current pension system during the next several decades and reduce the state’s unfunded pensions.

Source: Daily Journal