Bill Text: CA AB3245 | 2017-2018 | Regular Session | Amended
Bill Title: Public employees’ retirement.
Sponsorship: Committee Bill
Status: (Engrossed - Dead) 2018-05-24 - Referred to Com. on RLS. [AB3245 Detail]
Download: California-2017-AB3245-Amended.html
|
Amended
IN
Assembly
April 09, 2018 |
| Assembly Bill | No. 3245 |
| Introduced by Committee on Public Employees, Retirement, and Social Security (Assembly Members Rodriguez (Chair), Cooley, Cooper, and O’Donnell) |
February 22, 2018 |
LEGISLATIVE COUNSEL'S DIGEST
(1)The Public Employees’ Retirement Law (PERL) creates the Public Employees’ Retirement System (PERS) for the purpose of providing pension benefits to state employees and employees of contracting agencies and prescribes the rights and duties of members of the system and their beneficiaries. Existing law vests management and control of PERS in its board of administration. PERS provides a defined benefit to members of the program, based on final compensation, credited service, and age at retirement, subject to certain variations.
The California Public Employees’ Pension Reform Act of 2013 (PEPRA) generally requires a public retirement system, as defined, to modify its plan or plans to comply with the act. PEPRA describes pensionable compensation for new members of a public retirement system who become
members of that system on or after January 1, 2013, as consisting of the normal monthly rate of pay or base pay of the member to similarly situated members of the same group or class of employment for services rendered, subject to specified limitations.
PERL permits a member to retire concurrently from PERS and other specified public retirement systems and defines final compensation for these purposes. Under PERL, the highest annual average compensation during any consecutive 12- or 36- month period of employment as a member of a retirement system maintained by the University of California or by a county retirement system is considered compensation earnable for purposes of computing the member’s final compensation. PERL also prescribes that the compensation earnable during any period of service as a member of the Judges’ Retirement System, the Judges’ Retirement System II, the
Legislators’ Retirement System, or the Defined Benefit Program of the State Teachers’ Retirement Plan is considered compensation earnable for purposes of computing final compensation for the member, if he or she retires concurrently under both retirement systems.
This bill would revise the above provisions of PERL relating to retirement under concurrent systems to specify that the compensation earnable or pensionable compensation as a member of PERS is subject to the restrictions on compensation earnable under PERS and the restrictions on pensionable compensation under PEPRA.
(2)PERL authorizes the board to correct errors or omissions of active or retired members or their beneficiaries, subject to certain conditions and the existence of specified facts. PERL requires corrections of errors or omissions to be accomplished so that the status, rights, and obligations of the parties are adjusted to be the
same that they would have been if the act that would have been taken, but for the error or omission, was taken at the proper time.
This bill would require that an overpayment made to or on behalf of any member, former member, or beneficiary, including, but not limited to, contributions, interest, benefits of any kind, federal or state tax, or insurance premiums be deducted from any subsequent benefit that may be payable.
(3)For purposes of PERL, a “group or class of employment” means a number of employees considered together because they share similarities in job duties, work location, collective bargaining unit, or other logical work-related grouping. Under PERL, increases in compensation earnable granted to an employee who is not in a group or class are limited during the final compensation period applicable to the employee, as well as the 2 years immediately preceding that final compensation
period, to the average increase in compensation earnable during the same period reported by the employer for all employees who are in the same membership classification, except as otherwise determined by the board.
This bill, with respect to an employee who is not in a group or class, would specify that increases in compensation during that final compensation period are limited to the average increase in compensation earnable during the same period reported by the employer for all similarly situated employees who are in the closest related group or class within the same membership classification. The bill, with respect to an employee who is in a group or class would limit increases in compensation earnable during the final compensation period, as well as the 2 years immediately preceding that period, to the average increase in compensation earnable during the same period reported by the employer for all employees who are in the same group or class of employment
within the same membership classification, as prescribed.
(4)PERL defines “compensation earnable” for school members of the system to mean the payrate and special compensation of the member, as specified. PERL further defines “payrate” as the normal monthly rate of pay or base pay of the member paid in cash to similarly situated members of the same group or class of employment for services rendered on a full-time basis during normal working hours.
This bill would revise the definition of “payrate” above to specify that it applies for services rendered on a full-time basis during normal workhours pursuant to publicly available pay schedules.
(5)PERL prescribes disability retirement benefits for state members and certain local safety members of PERS. Existing law generally provides that if a medical examination and other available
information show to the satisfaction of the board of PERS that a member in state service is incapacitated physically or mentally for the performance of his or her duties and is eligible to retire for disability, the board shall immediately retire him or her for disability.
This bill would provide that a member is ineligible to retire for disability if the member separates from employment for any reason, including termination, voluntary resignation, resignation with disciplinary action pending, rejection on probation, or mutual agreement. Despite that limitation, the bill would specify that a member may be eligible to retire for disability under PERS if the member’s separation from employment was the ultimate result of a disabling medical condition or preemptive of an otherwise valid claim for disability retirement.
(6)PERL authorizes the governing body of a contracting agency to delegate any
authority or duty conferred or imposed with respect to disability retirement provisions under PERS to a subordinate officer of the contracting agency, subject to conditions it may impose.
This bill would instead require a governing body of a contracting agency to delegate this authority to a subordinate officer by adopting a resolution to that effect and filing that resolution with the board of PERS. The bill would permit a governing body of a contracting agency to also delegate its authority for other specified actions related to disability retirement to the board of PERS by adopting a resolution and filing it with the board and would require the contracting agency to pay a fee to PERS for those delegated services.
(7)Under PERL, the board of PERS or, with respect to a local safety member, the governing body of the employer from whose employment the person was retired, may require a recipient of a
disability retirement allowance who is under the minimum age for voluntary retirement for service to undergo medical examination.
This bill would require the board or the governing board of the employer, as applicable, to also cause a medical examination to be made upon application for reinstatement of a recipient of a disability retirement allowance, if the recipient is at least 6 months less than the age of compulsory retirement for service, as specified. The bill would modify other terms and conditions for medical examinations under these circumstances.
(8)PERL permits retired members of PERS and their beneficiaries to authorize deductions to be made from their retirement allowance payments and benefits, in accordance with regulations or procedures established by the board, for payment of group insurance premiums and other premiums, credit union payments or shares, dues and other services, and
charitable contributions, as specified.
This bill would revise and recast those provisions. The bill, among other things, would specify that payments for shares or obligations to any regularly chartered credit union and for charitable contributions apply with respect to those approved by the board as of December 31, 2018.
(9)PERL prescribes certain postretirement death benefits for beneficiaries and survivors of PERS members. Under PERL, in lieu of a $500 death benefit generally applicable to all contracting agencies, a contracting agency may elect instead to be subject to an alternative provision entitling a member’s beneficiary to a $600 death benefit, subject to certain conditions.
This bill would authorize this benefit by a contracting agency employer if it is designated by the employer in its contract prior to January 1, 2019.
(10)PERL provides an optional increased retirement death benefit for certain local members of the system, upon election by a contracting agency and amendment of its contract, in amounts of $2,000, $3,000, $4,000, or $5,000, if designated by the employer in its contract. With respect to school members, PERL also authorizes an optional increased retirement death benefit in amounts of $3,000, $4,000, or $5,000, if designated by the employer in its contract.
This bill would recast these provisions for the optional death benefit amounts of $3,000 or $4,000 to authorize these sums if that amount is designated by the employer in its contract prior to January 1, 2019. The bill would also make various conforming and nonsubstantive changes to PERL, the Judges’ Retirement Law, and the Judges’ Retirement System II Law.
Digest Key
Vote: MAJORITY Appropriation: NO Fiscal Committee:Bill Text
The people of the State of California do enact as follows:
The highest annual average compensation during any consecutive 12- or 36-month period of employment as a member of any retirement system maintained by the university shall be considered compensation earnable or pensionable compensation by a member of this system, and will be subject to the restrictions on compensation earnable contained in this part and the restrictions on pensionable compensation contained in Article 4 (commencing with Section 7522) of Chapter 21 of Division 7 of Title 1 and this part, for purposes of computing final compensation
for the member providing he or she retires concurrently under both systems.
SEC. 2.SECTION 1.
Section 20057 of the Government Code is amended to read:20057.
“Public agency” also includes the following:(a)Subject to subdivisions (c) and (d), the board may, in its discretion and upon any terms it deems just, correct the errors or omissions of any active or retired member, or any beneficiary of an active or retired member, provided that all of the following facts exist:
(1)The request, claim, or demand to correct the error or omission is made by the party seeking correction within a reasonable time after discovery of the right to make the correction, which in no case shall exceed six months after discovery of this right.
(2)The error or omission was the result of mistake, inadvertence, surprise, or excusable neglect, as each of those terms is used in Section
473 of the Code of Civil Procedure.
(3)The correction will not provide the party seeking correction with a status, right, or obligation not otherwise available under this part.
Failure by a member or beneficiary to make the inquiry that would be made by a reasonable person in like or similar circumstances does not constitute an “error or omission” correctable under this section.
(b)Subject to subdivisions (c) and (d), the board shall correct all actions taken as a result of errors or omissions of the university, any contracting agency, any state agency or department, or this system.
(c)The duty and power of the board to correct mistakes, as provided in this section, shall terminate upon the expiration of obligations of this system to the party seeking correction of the
error or omission, as those obligations are defined by Section 20164.
(d)The party seeking correction of an error or omission pursuant to this section has the burden of presenting documentation or other evidence to the board establishing the right to correction pursuant to subdivisions (a) and (b).
(e)Corrections of errors or omissions pursuant to this section shall be such that the status, rights, and obligations of all parties described in subdivisions (a) and (b) are adjusted to be the same that they would have been if the act that would have been taken, but for the error or omission, was taken at the proper time, except that an overpayment made to or on behalf of a benefit recipient shall be
deducted from any subsequent benefit payment.
However, notwithstanding any of the other provisions of this section, corrections made pursuant to this section shall adjust the status, rights, and obligations of all parties described in subdivisions (a) and (b) as of the time that the correction actually takes place if the board finds any of the following:
(1)That the correction cannot be performed in a retroactive manner.
(2)That even if the correction can be performed in a retroactive manner, the status, rights, and obligations of all of the parties described in subdivisions (a) and (b) cannot be adjusted to be the same that they
would have been if the error or omission had not occurred.
(3)That the purposes of this part will not be effectuated if the correction is performed in a retroactive manner.
(4)That an overpayment made to or on behalf of a benefit recipient has occurred and shall be deducted from any subsequent benefit payment.
SEC. 4.SEC. 2.
Section 20161 of the Government Code is amended to read:20161.
Notwithstanding any other provision of this part or of Section 12438 or 16302.1 to the contrary, the following shall apply:Any overpayment made to or on behalf of any member, former member, or beneficiary, including, but not limited to, contributions, interest, benefits of any kind, federal or state tax, or insurance premiums, shall be deducted from any subsequent benefit that may be payable.
SEC. 6.SEC. 3.
Section 20430 of the Government Code is amended to read:20430.
“Local police officer” also includes any officer or employee of a school district or a community college district that has established a police department pursuant to Section 38000 or 72330 of the Education Code, whose principal duties consist of active law enforcement service, except persons whose principal duties are clerical or otherwise clearly do not fall within the scope of active law enforcement, even though the person is subject to occasional call, or is occasionally called upon, to perform duties within the scope of active law enforcement. This section shall only apply to any school district or community college district that prior to June 30, 1982, had amended its contract to provide membership for local police officers.SEC. 7.SEC. 4.
Section 20444 of the Government Code is amended to read:20444.
“School safety member” includes any officer or employee of a school district or a community college district which has established a police department pursuant to Section 38000 or 72330 of the Education Code, whose principal duties consist of active law enforcement service, except persons whose principal duties are clerical or otherwise clearly do not fall within the scope of active law enforcement, even though the person is subject to occasional call, or is occasionally called upon, to perform duties within the scope of active law enforcement.(a)“Compensation earnable” by a member means the payrate and special compensation of the member, as defined by subdivisions (b), (c), and (g), and as limited by Section 21752.5.
(b)(1)“Payrate” means the normal monthly rate of pay or base pay of the member paid in cash to similarly situated members of the same group or class of employment for services rendered on a full-time basis during normal working hours, pursuant to publicly available pay schedules. “Payrate,” for a member who is not in a group or class, means the monthly rate of pay or base pay of the member, paid in cash and pursuant to publicly available pay schedules, for services rendered on a full-time basis during normal working hours, subject to the limitations of paragraph (2)
of subdivision (e).
(2)“Payrate” shall include an amount deducted from a member’s salary for any of the following:
(A)Participation in a deferred compensation plan.
(B)Payment for participation in a retirement plan that meets the requirements of Section 401(k) of Title 26 of the United States Code.
(C)Payment into a money purchase pension plan and trust that meets the requirements of Section 401(a) of Title 26 of the United States Code.
(D)Participation in a flexible benefits program.
(3)The computation for a leave without pay of a member shall be based on the compensation earnable by him or her at the beginning of the
absence.
(4)The computation for time prior to entering state service shall be based on the compensation earnable by him or her in the position first held by him or her in state service.
(c)(1)Special compensation of a member includes a payment received for special skills, knowledge, abilities, work assignment, workdays or hours, or other work conditions.
(2)Special compensation shall be limited to that which is received by a member pursuant to a labor policy or agreement or as otherwise required by state or federal law, to similarly situated members of a group or class of employment that is in addition to payrate. If an individual is not part of a group or class, special compensation shall be limited to that which the board determines is received by similarly situated members in the closest
related group or class that is in addition to payrate, subject to the limitations of paragraph (2) of subdivision (e).
(3)Special compensation shall be for services rendered during normal working hours and, when reported to the board, the employer shall do all of the following:
(A)Identify the pay period in which the special compensation was earned.
(B)Identify each item of special compensation and the category under which that item is listed, as described in regulations promulgated by the board pursuant to paragraph (6), for example, the item of Uniform Allowance would be reported under the category of Statutory Items.
(C)Report each item of special compensation separately from payrate.
(4)Special compensation may include the full monetary value of normal contributions paid to the board by the employer, on behalf of the member and pursuant to Section 20691, if the employer’s labor policy or agreement specifically provides for the inclusion of the normal contribution payment in compensation earnable.
(5)The monetary value of a service or noncash advantage furnished by the employer to the member, except as expressly and specifically provided in this part, is not special compensation unless regulations promulgated by the board specifically determine that value to be “special compensation.”
(6)The board shall promulgate regulations that delineate more specifically and exclusively what constitutes “special compensation” as used in this section. A uniform allowance, the monetary value of employer-provided uniforms, holiday pay, and premium pay for hours
worked within the normally scheduled or regular working hours that are in excess of the statutory maximum workweek or work period applicable to the employee under Section 201 and following of Title 29 of the United States Code shall be included as special compensation and appropriately defined in those regulations.
(7)Special compensation does not include any of the following:
(A)Final settlement pay.
(B)Payments made for additional services rendered outside of normal working hours, whether paid in lump sum or otherwise.
(C)Other payments the board has not affirmatively determined to be special compensation.
(d)Notwithstanding any other provision of law, payrate and special
compensation schedules, ordinances, or similar documents shall be public records available for public scrutiny.
(e)(1)As used in this part, “group or class of employment” means a number of employees considered together because they share similarities in job duties, work location, collective bargaining unit, or other logical work-related grouping. One employee may not be considered a group or class.
(2)Increases in compensation earnable granted to an employee who is not in a group or class shall be limited during the final compensation period applicable to the employee,
as well as the two years immediately preceding the final compensation period, to the average increase in compensation earnable during the same period reported by the employer for all similarly situated employees who are in the closest related group or class, as determined by the board, that is within the same membership classification, except as may otherwise be determined pursuant to regulations adopted by the board that establish reasonable standards for granting exceptions.
(3)Increases in compensation earnable granted to an employee who is in a group or class shall be limited during the final compensation period applicable to the
employee, as well as the two years immediately preceding the final compensation period, to the average increase in compensation earnable during the same period reported by the employer for all employees who are in the same group or class of employment, as determined by the board, that is within the same membership classification, except as may otherwise be determined pursuant to regulations adopted by the board that establish reasonable standards for granting exceptions.
(f)As used in this part, “final settlement pay” means pay or cash conversions of employee benefits that are in excess of compensation earnable, that are granted or awarded to a member in connection with, or in anticipation of, a separation from employment. The board shall promulgate regulations that delineate more specifically what constitutes final settlement pay.
(g)(1)Notwithstanding subdivision (a), “compensation earnable” for state members means the average monthly compensation, as determined by the board, upon the basis of the average time put in by members in the same group or class of employment and at the same rate of pay, and is composed of the payrate and special compensation of the member. The computation for an absence of a member shall be based on the compensation earnable by him or her at the beginning of the absence and for time prior to entering state service shall be based on the compensation earnable by him or her in the position first held by him or her in that state service.
(2)Notwithstanding subdivision (b), “payrate” for state members means the average monthly remuneration paid in cash out of funds paid by the employer to similarly situated members of the same group or class of employment, in payment for the member’s services or for time during which the member is
excused from work because of holidays, sick leave, vacation, compensating time off, or leave of absence. “Payrate” for state members shall include:
(A)An amount deducted from a member’s salary for any of the following:
(i)Participation in a deferred compensation plan established pursuant to Chapter 4 (commencing with Section 19993) of Part 2.6.
(ii)Payment for participation in a retirement plan that meets the requirements of Section 401(k) of Title 26 of the United States Code.
(iii)Payment into a money purchase pension plan and trust that meets the requirements of Section 401(a) of Title 26 of the United States Code.
(iv)Participation in a flexible benefits program.
(B)A payment in cash by the member’s employer to one other than an employee for the purpose of purchasing an annuity contract for a member under an annuity plan that meets the requirements of Section 403(b) of Title 26 of the United States Code.
(C)Employer “pick up” of member contributions that meets the requirements of Section 414(h)(2) of Title 26 of the United States Code.
(D)Disability or workers’ compensation payments to safety members in accordance with Section 4800 of the Labor Code.
(E)Temporary industrial disability payments pursuant to Article 4 (commencing with Section 19869) of Chapter 2.5 of Part 2.6.
(F)Other payments the board may determine to be within “payrate.”
(3)Notwithstanding subdivision (c), “special compensation” for state members shall mean all of the following:
(A)The monetary value, as determined by the board, of living quarters, board, lodging, fuel, laundry, and other advantages of any nature furnished to a member by his or her employer in payment for the member’s services.
(B)Compensation for performing normally required duties, such as holiday pay, bonuses (for duties performed on regular work shift), educational incentive pay, maintenance and noncash payments, out-of-class pay, marksmanship pay, hazard pay, motorcycle pay, paramedic pay, emergency medical technician pay, Peace Officer Standards and Training (POST) certificate pay, and split shift differential.
(C)Compensation for uniforms,
except as provided in Section 20632.
(D)Other payments the board may determine to be within “special compensation.”
(4)“Payrate” and “special compensation” for state members do not include any of the following:
(A)The provision by the state employer of a medical or hospital service or care plan or insurance plan for its employees (other than the purchase of annuity contracts as described below in this subdivision), a contribution by the employer to meet the premium or charge for that plan, or a payment into a private fund to provide health and welfare benefits for employees.
(B)A payment by the state employer of the employee portion of taxes imposed by the Federal Insurance Contribution Act.
(C)Amounts not available for payment of salaries and that are applied by the employer for the purchase of annuity contracts including those that meet the requirements of Section 403(b) of Title 26 of the United States Code.
(D)Benefits paid pursuant to Article 5 (commencing with Section 19878) of Chapter 2.5 of Part 2.6.
(E)Employer payments that are to be credited as employee contributions for benefits provided by this system, or employer payments that are to be credited to employee accounts in deferred compensation plans. The amounts deducted from a member’s wages for participation in a deferred compensation plan may not be considered to be “employer payments.”
(F)Payments for unused vacation, annual leave, personal leave, sick leave, or compensating time off, whether paid in lump sum or
otherwise.
(G)Final settlement pay.
(H)Payments for overtime, including pay in lieu of vacation or holiday.
(I)Compensation for additional services outside regular duties, such as standby pay, callback pay, court duty, allowance for automobiles, and bonuses for duties performed after the member’s regular work shift.
(J)Amounts not available for payment of salaries and that are applied by the employer for any of the following:
(i)The purchase of a retirement plan that meets the requirements of Section 401(k) of Title 26 of the United States Code.
(ii)Payment into a money purchase pension plan and trust that meets the
requirements of Section 401(a) of Title 26 of the United States Code.
(K)Payments made by the employer to or on behalf of its employees who have elected to be covered by a flexible benefits program, where those payments reflect amounts that exceed the employee’s salary.
(L)Other payments the board may determine are not “payrate” or “special compensation.”
(5)If the provisions of this subdivision, including the board’s determinations pursuant to subparagraph (F) of paragraph (2) and subparagraph (D) of paragraph (3), are in conflict with the provisions of a memorandum of understanding reached pursuant to Section 3517.5 or 3560, the memorandum of understanding shall be controlling without further legislative action, except that if the provisions of a memorandum of understanding require the expenditure of funds,
those provisions may not become effective unless approved by the Legislature in the annual Budget Act. No memorandum of understanding reached pursuant to Section 3517.5 or 3560 may exclude from the definition of either “payrate” or “special compensation” a member’s base salary payments or payments for time during which the member is excused from work because of holidays, sick leave, vacation, compensating time off, or leave of absence. If items of compensation earnable are included by memorandum of understanding as “payrate” or “special compensation” for retirement purposes for represented and higher education employees pursuant to this paragraph, the Department of Human Resources or the Trustees of the California State University shall obtain approval from the board for that inclusion.
(6)(A)Subparagraph (B) of paragraph (3) prescribes that compensation earnable includes compensation for performing normally required
duties, such as holiday pay, bonuses (for duties performed on regular work shift), educational incentive pay, maintenance and noncash payments, out-of-class pay, marksmanship pay, hazard pay, motorcycle pay, paramedic pay, emergency medical technician pay, POST certificate pay, and split shift differential; and includes compensation for uniforms, except as provided in Section 20632; and subparagraph (I) of paragraph (4) excludes from compensation earnable compensation for additional services outside regular duties, such as standby pay, callback pay, court duty, allowance for automobile, and bonuses for duties performed after regular work shift.
(B)Notwithstanding subparagraph (A), the Department of Human Resources shall determine which payments and allowances that are paid by the state employer shall be considered compensation for retirement purposes for an employee who either is excluded from the definition of state employee in Section 3513,
or is a nonelected officer or employee of the executive branch of government who is not a member of the civil service.
(C)Notwithstanding subparagraph (A), the Trustees of the California State University shall determine which payments and allowances that are paid by the trustees shall be considered compensation for retirement purposes for a managerial employee, as defined in Section 3562, or supervisory employee as defined in Section 3580.3.
(7)Notwithstanding subdivision (c), a state employer shall, when reporting payrate and special compensation, do all of the following:
(A)Identify the pay period in which the special compensation was earned.
(B)Identify each item of special compensation, as permitted pursuant to paragraphs (3) and (5).
(C)Report each item of special compensation separately from payrate.
(h)This section shall not apply to a new member, as defined in Section 7522.04.
(a)Notwithstanding Section 20636, and Section 45102 of the Education Code, “compensation earnable” by a school member means the payrate and special compensation of the member, as defined by subdivisions (b) and (c), and as limited by Section 21752.5.
(b)(1)“Payrate” means the normal monthly rate of pay or base pay of the member paid in cash to similarly situated members of the same group or class of employment for services rendered on a full-time basis during normal working hours, pursuant to publicly available pay schedules. For purposes of
this part, for classified members, full-time employment is 40 hours per week, and payments for services rendered, not to exceed 40 hours per week, shall be reported as compensation earnable for all months of the year in which work is performed. “Payrate,” for a member who is not in a group or class, means the monthly rate of pay or base pay of the member, paid in cash and pursuant to publicly available pay schedules, for services rendered on a full-time basis during normal working hours, subject to the limitations of paragraph (2) of subdivision (e).
(A)“Payrate” shall include an amount deducted from a member’s salary for any of the following:
(i)Participation in a deferred compensation plan.
(ii)Payment for participation in a retirement plan that meets the requirements of Section 401(k) or 403(b) of Title 26 of
the United States Code.
(iii)Payment into a money purchase pension plan and trust that meets the requirements of Section 401(a) of Title 26 of the United States Code.
(iv)Participation in a flexible benefits program.
(B)For the purposes of this section, “classified members” shall mean members who retain membership under this system while employed with a school employer in positions not subject to coverage under the Defined Benefit Program under the State Teachers’ Retirement System.
(C)For the purposes of this section, and Sections 20962 and 20966, “certificated members” shall mean members who retain membership under this system while employed in positions subject to coverage under the Defined Benefit Program under the State Teachers’ Retirement
System.
(2)The computation for any leave without pay of a member shall be based on the compensation earnable by him or her at the beginning of the absence.
(3)The computation for time prior to entering state service shall be based on the compensation earnable by him or her in the position first held by him or her in state service.
(c)(1)Special compensation of a school member includes any payment received for special skills, knowledge, abilities, work assignment, workdays or hours, or other work conditions.
(2)Special compensation shall be limited to that which is received by a member pursuant to a labor policy or agreement or as otherwise required by state or federal law, to similarly situated members of a group or class of
employment that is in addition to payrate. If an individual is not part of a group or class, special compensation shall be limited to that which the board determines is received by similarly situated members in the closest related group or class that is in addition to payrate, subject to the limitations of paragraph (2) of subdivision (e).
(3)Special compensation shall be for services rendered during normal working hours and, when reported to the board, the employer shall:
(A)Identify the pay period in which the special compensation was earned.
(B)Identify each item of special compensation and the category under which that item is listed, as described in regulations promulgated by the board pursuant to paragraph (6) of subdivision (c), for example, the item of Uniform Allowance would be reported under the category
of Statutory Items. and
(C)Report each item of special compensation separately from payrate.
(4)Special compensation may include the full monetary value of normal contributions paid to the board by the employer, on behalf of the member and pursuant to Section 20691, provided that the employer’s labor policy or agreement specifically provides for the inclusion of the normal contribution payment in compensation earnable.
(5)The monetary value of any service or noncash advantage furnished by the employer to the member, except as expressly and specifically provided in this part, shall not be special compensation unless regulations promulgated by the board specifically determine that value to be “special compensation.”
(6)The board shall promulgate
regulations that delineate more specifically and exclusively what constitutes “special compensation” as used in this section. A uniform allowance, the monetary value of employer-provided uniforms, holiday pay, and premium pay for hours worked within the normally scheduled or regular working hours that are in excess of the statutory maximum workweek or work period applicable to the employee under Section 201 and following of Title 29 of the United States Code shall be included as special compensation and appropriately defined in those regulations.
(7)Special compensation does not include any of the following:
(A)Final settlement pay.
(B)Payments made for additional services rendered outside of normal working hours, whether paid in lump sum or otherwise.
(C)Any other payments the board has not affirmatively determined to be special compensation.
(d)Notwithstanding any other provision of law, payrate and special compensation schedules, ordinances, or similar documents shall be public records available for public scrutiny.
(e)(1)As used in this part, “group or class of employment” means a number of employees considered together because they share similarities in job duties, work location, collective bargaining unit, or other logical work-related grouping. Under no circumstances shall one employee be considered a group or class.
(2)Increases in compensation earnable granted to any employee who is not in a group or class shall be limited during the final compensation period applicable to the
employee, as well as the two years immediately preceding the final compensation period, to the average increase in compensation earnable during the same period reported by the employer for all similarly situated employees who are in the closest related group or class, as determined by the board, that is within the same membership classification, except as may otherwise be determined pursuant to regulations adopted by the board that establish reasonable standards for granting exceptions.
(3)Increases in compensation earnable granted to an employee who is in a group or class shall be limited during the final
compensation period applicable to the employee, as well as the two years immediately preceding the final compensation period, to the average increase in compensation earnable during the same period reported by the employer for all employees who are in the same group or class of employment, as determined by the board, that is within the same membership classification, except as may otherwise be determined pursuant to regulations adopted by the board that establish reasonable standards for granting exceptions.
(f)As used in this part, “final settlement pay” means any pay or cash conversions of employee benefits that are in excess of compensation earnable, that are granted or awarded to a member in connection with or in anticipation of a separation from employment. The board shall promulgate regulations that delineate more specifically what constitutes final settlement pay.
(g)This section shall not apply to a new member, as defined in Section 7522.04.
The highest annual average compensation during any consecutive 12- or 36-month period of employment as a member of a county retirement system shall be considered compensation earnable or pensionable compensation by a member of this system, and will be subject to the restrictions on compensation earnable contained in this part and the restrictions on pensionable compensation contained in Article 4 (commencing with Section 7522) of Chapter 21 of Division 7 of Title 1 and this part, for purposes of computing final compensation for the member
provided:
(a)(1)Entry into employment in which he or she became a member in one system occurred on or after October 1, 1957, and within 90 days of discontinuance of employment as a member of the other system.
(2)This subdivision shall not deny the benefit of this section to any person retiring after October 1, 1963, who entered membership prior to October 1, 1957, if he or she entered the employment in which he or she became a member within 90 days of termination of employment in which he or she was a member of the other system, and he or she became a member within seven months of entry into employment, or, if an employee of a district as defined in Section 31468, became a member at the time the district was included in a county retirement system.
(b)He or she retires concurrently under both
systems and is credited with the period of service under the county system at the time of retirement.
The compensation earnable during any period of service as a member of the Judges’ Retirement System, the Judges’ Retirement System II, the Legislators’ Retirement System, or the Defined Benefit Program of the State Teachers’ Retirement Plan shall be considered compensation earnable or pensionable compensation as a member of this system, and will be subject to the restrictions on compensation earnable contained in this part and
the restrictions on pensionable compensation contained in Article 4 (commencing with Section 7522) of Chapter 21 of Division 7 of Title 1 and this part, for purposes of computing final compensation for the member, if he or she retires concurrently under both systems.
A member shall be deemed to have retired concurrently under this system and under the Defined Benefit Program of the State Teachers’ Retirement Plan, if the member is enrolled as a disabled member under the Defined Benefit Program of the State Teachers’ Retirement Plan and for retirement under this system on the same effective date.
(a)(1)If the medical examination and other available information show to the satisfaction of the board, or in the case of a local safety member, other than a school safety member, the governing body of the contracting agency employing the member, that the member in the state service is incapacitated physically or mentally for the performance of his or her duties and is eligible to retire for disability, the board shall immediately retire him or her for disability, unless the member is qualified to be retired for service and applies therefor prior to the effective date of his or her retirement for disability or within 30 days after the member is notified of his
or her eligibility for retirement on account of disability, in which event the board shall retire the member for service.
(2)In determining whether a member is eligible to retire for disability, the board or governing body of the contracting agency shall make a determination on the basis of competent medical opinion and shall not use disability retirement as a substitute for the disciplinary process.
(3)Except as set forth in paragraph (4), a member is ineligible to retire for disability if the member separates from employment for any reason, including, but not limited to, termination, voluntary resignation, resignation with disciplinary action pending, rejection on probation, or mutual agreement.
(4)Notwithstanding paragraph (3), a
member may be eligible to retire for disability, in accordance with this part, if the separation from employment was the ultimate result of a disabling medical condition or preemptive of an otherwise valid claim for disability retirement.
(b)(1)The governing body of a contracting agency upon receipt of the request of the board pursuant to Section 21154 shall certify to the board its determination under this section that the member is or is not incapacitated.
(2)The local safety member may appeal the determination of the governing body. Appeal hearings shall be conducted by an administrative law judge of the Office of Administrative Hearings pursuant to Chapter 5 (commencing with Section 11500) of Part 1 of Division 3 of this title.
(a)The governing body of a contracting agency may delegate any authority or duty conferred or imposed under this article to a subordinate officer subject to conditions it may impose by adopting a resolution to that effect and filing that resolution with the board.
(b)(1)The governing body of a contracting agency may also delegate its authority for any of the following actions to the board by adopting a resolution to that effect and filing that resolution with the board:
(A)Process an application for disability retirement of a member who is an employee of the contracting agency and make the determination on whether the member is eligible to retire for disability under this article.
(B)Require a recipient of a disability retirement allowance, who retired from the contracting agency and who is under the minimum age for voluntary retirement for service applicable to members of his or her class, to undergo a medical examination and make the determination on whether the member is eligible to reinstate from disability retirement under Article 7 of this
chapter.
(C)Process an application for reinstatement from disability retirement of a member who is an employee of the contracting agency and make the determination on whether the member is eligible to reinstate from disability retirement under Article 7 of this chapter.
(2)The board may impose any necessary terms and conditions to carry out the authority delegated under this subdivision. The contracting agency shall pay an administrative fee to the system, in an amount determined by the board, for each such service and shall also reimburse the system for expenses incurred in providing each such service.
(a)The board, or in the case of a local safety member, other than a school safety member, the governing body of the employer from whose employment the person was retired, may require any recipient of a disability retirement allowance under the minimum age for voluntary retirement for service applicable to members of his or her class to undergo medical
examination.
(b)The board, or in the case of a local safety member, other than a school safety member, the governing board of the employer from whose employment the person was retired, shall also cause a medical examination to be made upon application for reinstatement of a recipient
of a disability retirement allowance who is at least six months less than the age of compulsory retirement for service applicable to members of the class or category in which it is proposed to employ him or her.
(c)The board, or in the case of a local safety member, other than a school safety member, the governing body of the employer from whose employment the person was retired, shall also cause
a medical examination to be made upon application for reinstatement to the position held at retirement or any position in the same class, of a person who was incapacitated for performance of duty in the position at the time of a prior reinstatement to another position.
(d)Any examination conducted pursuant to subdivision (a), (b), or (c) shall be made by a physician or surgeon, appointed by the board, or in the case of a local safety member, other than
a school safety member,
the governing body of the employer from whose employment the person was retired, at the place of residence of the recipient or other place mutually agreed upon. Upon the basis of the examination, the board or, in the case of a local safety member, other than a school safety member, the governing body of the employer from whose employment the person was retired, shall determine whether he or she is still incapacitated, physically or mentally, for duty in the state agency, the university, or
contracting agency, where he or she was employed and in the position held by him or her when retired for disability, or in a position in the same classification, and for the duties of the position with regard to which he or she has applied for reinstatement from retirement.
Retired members of this system, and beneficiaries who are entitled to receive allowances or benefits under this part, may authorize deductions to be made from their retirement allowance payments or from the allowances and benefits, respectively, or from either or both if both are being received, in accordance with regulations or procedures established by the board for the payment of:
(a)Group insurance premiums or other premiums for employer-sponsored benefit programs under appropriate statutory authority and any related fees.
(b)Shares or obligations to any regularly chartered credit union, approved by the board as of December 31,
2018.
(c)Payment of retired member and voluntary association dues.
The board shall determine the additional cost involved in making deductions under this section and the state agency, the public agency, the association, or the unit thereof, or the credit union shall pay the amount of the additional cost to the board for deposit in the retirement fund.
Retired members of this system, and beneficiaries who are entitled to receive allowances or benefits under this part, may authorize deductions to be made from their retirement allowance payments or from the allowances and benefits, respectively, or from either or both when both are being received in accordance with regulations established by the board for the payment of charitable contributions under any plan approved by the board, as of December 31, 2018. In lieu of approving individual plans, the board, at its discretion, may adopt by reference those plans approved by the Department of General Services under Section 14659. The board shall determine the additional cost involved in making deductions under this section, and the agency to receive the
contributions shall pay the amount of the additional cost to the board for deposit in the retirement fund.
(a)In lieu of benefits provided by Section 21620, upon the death of any person, after retirement and while receiving a retirement allowance from this system, there shall be paid to the beneficiary whom he or she shall nominate by written designation duly executed and filed with the board, the sum of six hundred dollars ($600), to be provided from contributions by the employer, if that amount is designated by the employer in its contract prior to January 1, 2019.
(b)For the purposes of this section, all contributions, liabilities, actuarial interest rates, and other valuation factors shall be determined on the basis of actuarial assumptions and
methods that, in the aggregate, are reasonable and that, in combination, offer the actuary’s best estimate of anticipated experience under this system.
(c)The additional employer contributions required under this section shall be computed as a level percentage of member compensation. The additional contribution rate required at the time this section is added to a contract shall not be less than the sum of (1) the actuarial normal cost and, (2) the additional contribution required to amortize the increase in accrued liability attributable to benefits elected under this section over a period of not more than 30 years from the date this section becomes effective in the contracting agency’s contract.
(d)This section shall not apply to any contracting agency, except for those
contracting agencies that are school employers and those school districts or community college districts, as defined in subdivision (i) of Section 20057, until the agency elects to be subject to this section by amendment to its contract made in the manner prescribed for approval of contracts, except an election among the employees is not required, or, in the case of contracts made after January 1, 1981, by express provision in the contract making the contracting agency subject to this section.
(a)In lieu of benefits provided by Sections 21620 and 21622 upon the death of any local member, after retirement and while receiving a retirement allowance from this system, there shall be paid to the beneficiary whom he or she shall nominate by written designation duly executed and filed with the board, the sum of two thousand dollars ($2,000) or five thousand dollars ($5,000), whichever amount is designated by the employer in its contract, to be provided from contributions by the employer.
(b)In lieu of benefits provided by Sections 21620 and 21622 upon the death of any local member, after retirement and while receiving a retirement
allowance from this system, there shall be paid to the beneficiary who he or she shall nominate by written designation duly executed and filed with the board, the sum of three thousand dollars ($3,000) or four thousand dollars ($4,000), to be provided from contributions by the employer, if that amount was designated by the employer in its contract prior to January 1, 2019.
(c)For the purposes of this section, all contributions, liabilities,
actuarial interest rates, and other valuation factors shall be determined on the basis of actuarial assumptions and methods that, in the aggregate, are reasonable and that, in combination, offer the actuary’s best estimate of anticipated experience under the system.
(d)The additional employer contributions required under this section shall be computed as a level percentage of member compensation.
(e)This section shall not apply to a contracting agency unless and until the agency elects to be subject to this section by amendment to its contract made in the manner prescribed for approval of contracts, except an election among the employees is not required or in the case of contracts made on or after January 1, 1999, except by express provision in the contract
making the contracting agency subject to this section.
(a)In lieu of benefits provided by Sections 21620, 21622, and 21623, upon the death of any school member, after retirement and while receiving a retirement allowance from this system, there shall be paid to the beneficiary whom he or she shall nominate by written designation duly executed and filed with the board, the sum of five thousand dollars ($5,000), if that amount is designated by the employer in its contract, to be provided from contributions by the employer.
(b)In lieu of benefits provided by Sections 21620, 21622, and 21623, upon the death of any school member, after retirement and while receiving a retirement allowance from this
system, there shall be paid to the beneficiary who he or she shall nominate by written designation duly executed and filed with the board, the sum of three thousand dollars ($3,000) or four thousand dollars ($4,000), to be provided from contributions by the employer, if that amount is designated by the employer in its contract, prior to January 1, 2019.
(c)For the purposes of this section, all contributions, liabilities, actuarial interest rates, and other valuation factors shall be determined on the basis of actuarial assumptions and methods that, in the aggregate, are reasonable and that, in combination, offer the actuary’s best estimate of anticipated experience under the system.
(d)The additional employer contributions required under this section shall be computed as a
level percentage of member compensation.
(e)This section shall not apply to a school employer unless and until it elects to be subject to this section by amendment to its contract made in the manner prescribed for approval of contracts or, in the case of contracts made on or after January 1, 2001, except by express provision in the contract making the school employer subject to this section.
