1     
POSTRETIREMENT EMPLOYMENT EXCEPTIONS

2     
2016 GENERAL SESSION

3     
STATE OF UTAH

4     
Chief Sponsor: Karen Mayne

5     
House Sponsor: Don L. Ipson

6     

7     LONG TITLE
8     Committee Note:
9          The Retirement and Independent Entities Interim Committee recommended this bill.
10     General Description:
11          This bill modifies the Utah State Retirement and Insurance Benefit Act by amending
12     postretirement reemployment provisions.
13     Highlighted Provisions:
14          This bill:
15          ▸     allows certain retirees to be reemployed with a participating employer after a certain
16     period from the retiree's retirement date if the retiree:
17               •     does not receive certain employer provided retirement benefits for the
18     reemployment; and
19               •     is reemployed by a different agency;
20          ▸     requires a participating employer to pay the contribution rate for a reemployed
21     retiree in certain circumstances; and
22          ▸     makes technical changes.
23     Money Appropriated in this Bill:
24          None
25     Other Special Clauses:
26          None
27     Utah Code Sections Affected:
28     AMENDS:
29          49-11-505, as last amended by Laws of Utah 2015, Chapters 243 and 256
30     

31     Be it enacted by the Legislature of the state of Utah:
32          Section 1. Section 49-11-505 is amended to read:
33          49-11-505. Reemployment of a retiree -- Restrictions -- Penalties.
34          (1) (a) For purposes of this section, "retiree":
35          (i) means a person who:
36          (A) retired from a participating employer; and
37          (B) begins reemployment on or after July 1, 2010, with a participating employer;
38          (ii) does not include a person:
39          (A) who was reemployed by a participating employer before July 1, 2010; and
40          (B) whose participating employer that reemployed the person under Subsection
41     (1)(a)(ii)(A) was dissolved, consolidated, merged, or structurally changed in accordance with
42     Section 49-11-621 after July 1, 2010; and
43          (iii) does not include a person who is reemployed as an active senior judge or an active
44     senior justice court judge as described by Utah State Court Rules, appointed to hear cases by
45     the Utah Supreme Court in accordance with Article VIII, Section 4, Utah Constitution.
46          (b) (i) This section does not apply to employment as an elected official if the elected
47     official's position is not full time as certified by the participating employer.
48          (ii) The provisions of this section apply to an elected official whose elected position is
49     full time as certified by the participating employer.
50          (c) (i) This section does not apply to employment as a part-time appointed board
51     member who does not receive any remuneration, stipend, or other benefit for the part-time
52     appointed board member's service.
53          (ii) For purposes of this Subsection (1)(c), remuneration, stipend, or other benefit does
54     not include receipt of per diem and travel expenses up to the amounts established by the
55     Division of Finance in:
56          (A) Section 63A-3-106;
57          (B) Section 63A-3-107; and
58          (C) rules made by the Division of Finance according to Sections 63A-3-106 and
59     63A-3-107.
60          (d) (i) For purposes of this Subsection (1)(d), "affiliated emergency services worker"
61     means a person who:
62          (A) is employed by a participating employer [and who];
63          (B) performs emergency services for another participating employer that is a different
64     agency [in which the person:];
65          [(A)] (C) [has been] is trained in techniques and skills required for the service the
66     person provides to the participating employer;
67          [(B)] (D) continues to receive regular training required for the service;
68          [(C)] (E) is on the rolls as a trained affiliated emergency services worker of the
69     participating employer; and
70          [(D)] (F) provides ongoing service for a participating employer, which service may
71     include service as a volunteer firefighter, reserve law enforcement officer, search and rescue
72     personnel, emergency medical technician, ambulance personnel, park ranger, or public utilities
73     worker.
74          (ii) A person who performs work or service but does not meet the requirements of
75     Subsection (1)(d)(i) is not an affiliated emergency services worker for purposes of this
76     Subsection (1)(d).
77          (iii) The office may not cancel the retirement allowance of a retiree who is employed as
78     an affiliated emergency services worker within one year of the retiree's retirement date if the
79     affiliated emergency services worker does not receive any compensation, except for:
80          (A) a nominal fee, stipend, discount, tax credit, voucher, or other fixed sum of money
81     or cash equivalent payment not tied to productivity and paid periodically for services;
82          (B) a length-of-service award;
83          (C) insurance policy premiums paid by the participating employer in the event of death
84     of an affiliated emergency services worker or a line-of-duty accidental death or disability; or
85          (D) reimbursement of expenses incurred in the performance of duties.
86          (iv) For purposes of Subsections (1)(d)(iii)(A) and (B), the total amount of any
87     discounts, tax credits, vouchers, and payments to a volunteer may not exceed $500 per month.
88          (v) Beginning January 1, 2016, the board shall adjust the amount under Subsection
89     (1)(d)(iv) by the annual change in the Consumer Price Index during the previous calendar year
90     as measured by a United States Bureau of Labor Statistics Consumer Price Index average as
91     determined by the board.
92          (vi) The office shall cancel the retirement allowance of a retiree for the remainder of
93     the calendar year if employment as an affiliated emergency services worker with a participating
94     employer exceeds the limitation under Subsection (1)(d)(iv).
95          (vii) If a retiree is employed as an affiliated emergency services worker under the
96     provisions of Subsection (1)(d), the termination date of the employment as an affiliated
97     emergency services worker, as confirmed in writing by the participating employer, is
98     considered the retiree's retirement date for the purpose of calculating the separation
99     requirement under Subsection (3)(a).
100          (2) A retiree may not for the same period of reemployment:
101          (a) (i) earn additional service credit; or
102          (ii) receive any retirement related contribution from a participating employer; and
103          (b) receive a retirement allowance.
104          (3) (a) Except as provided under Subsection (1)(d), (3)(b), (3)(d), or (10), the office
105     shall cancel the retirement allowance of a retiree if the reemployment with a participating
106     employer begins within one year of the retiree's retirement date.
107          (b) The office may not cancel the retirement allowance of a retiree who is reemployed
108     with a participating employer within one year of the retiree's retirement date if:
109          (i) the retiree is not reemployed by a participating employer for a period of at least 60
110     days from the retiree's retirement date;
111          (ii) upon reemployment after the break in service under Subsection (3)(b)(i), the retiree
112     does not receive any employer [provided] paid benefits, including:
113          (A) retirement service credit or retirement related contributions;
114          [(A)] (B) medical benefits;
115          [(B)] (C) dental benefits;
116          [(C)] (D) other insurance benefits except for workers' compensation as provided under
117     Title 34A, Chapter 2, Workers' Compensation Act, and withholdings required by federal or
118     state law for Social Security, Medicare, and unemployment insurance; or
119          [(D)] (E) paid time off, including sick, annual, or other type of leave; and
120          (iii) (A) the retiree does not earn in any calendar year of reemployment an amount in
121     excess of the lesser of $15,000 or one-half of the retiree's final average salary upon which the
122     retiree's retirement allowance is based; or
123          (B) the retiree is reemployed as a judge as defined under Section 78A-11-102.
124          (c) Beginning January 1, 2013, the board shall adjust the amounts under Subsection
125     (3)(b)(iii)(A) by the annual change in the Consumer Price Index during the previous calendar
126     year as measured by a United States Bureau of Labor Statistics Consumer Price Index average
127     as determined by the board.
128          (d) The office shall cancel the retirement allowance of a retiree for the remainder of the
129     calendar year if the reemployment with a participating employer exceeds the limitation under
130     Subsection (3)(b)(iii)(A).
131          (e) The office may not cancel the retirement allowance of a retiree who is reemployed
132     with a participating employer within one year of the retiree's retirement date if:
133          (i) the retiree:
134          (A) is not reemployed by a participating employer for a period of at least 60 days from
135     the retiree's retirement date;
136          (B) is reemployed by a different agency;
137          (C) is reemployed by a participating employer as a:
138          (I) public safety service employee as defined in Section 49-14-102, 49-15-102, or
139     49-23-102;
140          (II) firefighter service employee as defined in Section 49-16-102 or 49-23-102; or
141          (III) school district employee who is an educator as defined under Section 53A-6-103;
142     and
143          (D) does not receive any employer paid retirement service credit or retirement related
144     contributions from the participating employer; and
145          (ii) the participating employer pays the contribution rate to the office as if the retiree's
146     reemployed position were considered to be an eligible full-time position within that system but
147     the retiree does not earn additional service credit.
148          (f) Any contribution paid to the office under Subsection (3)(e)(ii) shall be applied to
149     the system that would have covered the retiree if the retiree's reemployed position were
150     considered to be an eligible full-time position within that system.
151          [(d) The office shall cancel the retirement allowance of a retiree for the remainder of
152     the calendar year if the reemployment with a participating employer exceeds the limitation
153     under Subsection (3)(b)(iii)(A).]
154          [(e)] (g) If a retiree is reemployed under the provisions of Subsection (3)(b)[,] or (3)(e),
155     the termination date of the reemployment, as confirmed in writing by the participating
156     employer, is considered the retiree's retirement date for the purpose of calculating the
157     separation requirement under Subsection (3)(a).
158          [(f) If a retiree received a retirement allowance in error, due to reemployment in
159     violation of this section:]
160          [(i) the office shall cancel the retiree's retirement allowance; and]
161          [(ii) if the retiree applies for a future benefit, the office shall recover any overpayment
162     in accordance with the provisions of Section 49-11-607.]
163          (4) If a reemployed retiree has completed the one-year separation from employment
164     with a participating employer required under Subsection (3)(a), the retiree may elect to:
165          (a) earn additional service credit in accordance with this title and cancel the retiree's
166     retirement allowance; or
167          (b) continue to receive the retiree's retirement allowance and forfeit any retirement
168     related contribution from the participating employer who reemployed the retiree.
169          (5) (a) As used in this Subsection (5), "amortization rate" means the amortization rate,
170     as defined in Section 49-11-102, to be applied to the system that would have covered the retiree
171     if the retiree's reemployed position were deemed to be an eligible, full-time position within that
172     system.
173          (b) A participating employer who reemploys a retiree shall contribute to the office the
174     amortization rate if the reemployed retiree:
175          (i) has completed the one-year separation from employment with a participating
176     employer required under Subsection (3)(a); and
177          (ii) makes an election under Subsection (4)(b) to continue to receive a retirement
178     allowance while reemployed.
179          (c) A participating employer who reemploys a retiree in accordance with Subsection
180     (3)(b) is not required to contribute the amortization rate to the office.
181          (6) (a) A participating employer shall immediately notify the office:
182          (i) if the participating employer reemploys a retiree;
183          (ii) whether the reemployment is subject to Subsection (3)(b), (3)(e), or (4) of this
184     section; and
185          (iii) of any election by the retiree under Subsection (4).
186          (b) A participating employer shall certify to the office whether the position of an
187     elected official is or is not full time.
188          (c) A participating employer is liable to the office for a payment or failure to make a
189     payment in violation of this section.
190          (d) If a participating employer fails to notify the office in accordance with this section,
191     the participating employer is immediately subject to a compliance audit by the office.
192          (7) (a) The office shall immediately cancel the retirement allowance of a retiree in
193     accordance with Subsection (7)(b) if the office receives notice or learns of:
194          (i) the reemployment of a retiree in violation of Subsection (1)(d) or (3); or
195          (ii) the election of a reemployed retiree under Subsection (4)(a).
196          (b) If the retiree is eligible for retirement coverage in the reemployed position, the
197     office shall cancel the allowance of a retiree who is subject to Subsection (7)(a), and reinstate
198     the retiree to active member status on the first day of the month following the date of:
199          (i) reemployment if the retiree is subject to Subsection (3); or
200          (ii) an election by an employee under Subsection (4)(a).
201          (c) If the retiree is not otherwise eligible for retirement coverage in the reemployed
202     position:
203          (i) the office shall cancel the allowance of a retiree subject to Subsection (7)(a)(i); and
204          (ii) except as provided under Subsection (5)(c), the participating employer shall pay the
205     amortization rate to the office on behalf of the retiree.
206          (8) (a) [A] For a retiree subject to Subsection (7)(b) who retires within two years from
207     the date of reemployment, the office:
208          (i) [is not entitled to a recalculated] may not recalculate a retirement benefit for the
209     retiree; and
210          (ii) [will] shall resume the allowance that was being paid to the retiree at the time of
211     the cancellation.
212          (b) Subject to Subsection (2), for a retiree who is reinstated to active membership
213     under Subsection (7) and who retires two or more years after the date of reinstatement to active
214     membership, the office shall:
215          (i) resume [receiving] the allowance that was being paid at the time of cancellation;
216     and
217          (ii) [receive] calculate an additional allowance for the retiree based on the formula in
218     effect at the date of the subsequent retirement for all service credit accrued between the first
219     and subsequent retirement dates.
220          (9) (a) A retiree subject to this section shall report to the office the status of the
221     reemployment under Subsection (3) or (4).
222          (b) If the retiree fails to inform the office of an election under Subsection (4), the office
223     shall withhold one month's benefit for each month the retiree fails to inform the office under
224     Subsection (9)(a).
225          (10) A retiree shall be considered as having completed the one-year separation from
226     employment with a participating employer required under Subsection (3)(a), if the retiree:
227          (a) before retiring:
228          (i) was employed with a participating employer as a public safety service employee as
229     defined in Section 49-14-102, 49-15-102, or 49-23-102;
230          (ii) and during the employment under Subsection (10)(a)(i), suffered a physical injury
231     resulting from external force or violence while performing the duties of the employment, and
232     for which injury the retiree would have been approved for total disability in accordance with
233     the provisions under Title 49, Chapter 21, Public Employees' Long-Term Disability Act, if
234     years of service are not considered;
235          (iii) had less than 30 years of service credit but had sufficient service credit to retire,
236     with an unreduced allowance making the public safety service employee ineligible for
237     long-term disability payments under Title 49, Chapter 21, Public Employees' Long-Term
238     Disability Act, or a substantially similar long-term disability program; and
239          (iv) does not receive any long-term disability benefits from any participating employer;
240     and
241          (b) is reemployed by a different participating employer.
242          (11) (a) If a retiree received a retirement allowance in error, due to reemployment in
243     violation of this section:
244          (i) the office shall cancel the retiree's retirement allowance; and
245          (ii) if the retiree applies for a future benefit, the office shall recover any overpayment in
246     accordance with the provisions of Section 49-11-607.
247          (b) If a retiree or participating employer failed to report reemployment in violation of
248     this section, the retiree, participating employer, or both who are found to be responsible for the
249     failure to report are liable to the office for the amount of any overpayment resulting from the
250     violation.
251          [(11)] (12) The board may make rules to implement this section.




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