ASSEMBLY, No. 655

 

STATE OF NEW JERSEY

 

Introduced Pending Technical Review by Legislative Counsel

 

PRE-FILED FOR INTRODUCTION IN THE 1996 SESSION

 

 

By Assemblyman ZECKER

 

 

An Act concerning certain retired members of the Public Employees' Retirement System and amending P.L.1954, c.84 and P.L.1966, c.216.

 

    Be It Enacted by the Senate and General Assembly of the State of New Jersey:

 

    1. Section 7 of P.L.1954, c.84 (C.43:15A-7) is amended to read as follows:

    7. There is hereby established the Public Employees' Retirement System of New Jersey in the Division of Pensions of the Department of the Treasury. The membership of the retirement system shall include:

    a. The members of the former "State Employees' Retirement System of New Jersey" enrolled as such as of December 30, 1954, who shall not have claimed for refund their accumulated deductions in said system as provided in this section;

    b. Any person becoming an employee of the State or other employer after January 2, 1955 and every veteran, other than a retired member who returns to service pursuant to subsection b. of section 27 of P.L.1966, c.217 (C.43:15A-57.2) and other than those whose appointments are seasonal, becoming an employee of the State or other employer after such date, including a temporary employee with at least one year's continuous service; and

    c. Every employee veteran in the employ of the State or other employer on January 2, 1955, who is not a member of any retirement system supported wholly or partly by the State.

    d. Membership in the retirement system shall be optional for elected officials other than veterans, and for school crossing guards, who having become eligible for benefits under other pension systems are so employed on a part-time basis. Any such part-time school crossing guard who is eligible for benefits under any other pension system and who was hired as a part-time school crossing guard prior to March 4, 1976, may at any time terminate his membership in the retirement system by making an application in writing to the board of trustees of the retirement system. Upon receiving such application, the board of trustees shall terminate his enrollment in the system and direct the employer to cease accepting contributions from the member or deducting from the compensation paid to the member. State employees who become members of any other retirement system supported wholly or partly by the State as a condition of employment shall not be eligible for membership in this retirement system. Notwithstanding any other law to thecontrary, all other persons accepting employment in the service of the State shall be required to enroll in the retirement system as a condition of their employment, regardless of age. No person in employment, office or position, for which the annual salary or remuneration is fixed at less than $1,500.00, shall be eligible to become a member of the retirement system.

    e. Membership of any person in the retirement system shall cease if he shall discontinue his service for more than two consecutive years.

    f. The accumulated deductions of the members of the former "State Employees' Retirement System" which have been set aside in a trust fund designated as Fund A as provided in section 5 of this act and which have not been claimed for refund prior to February 1, 1955 shall be transferred from said Fund A to the Annuity Savings Fund of the Retirement System, provided for in section 25 of this act. Each member whose accumulated deductions are so transferred shall receive the same prior service credit, pension credit, and membership credit in the retirement system as he previously had in the former "State Employees' Retirement System" and shall have such accumulated deductions credited to his individual account in the Annuity Savings Fund. Any outstanding obligations of such member shall be continued.

    g. Any school crossing guard electing to terminate his membership in the retirement system pursuant to subsection d. of this section shall, upon his request, receive a refund of his accumulated deductions as of the date of his appointment to the position of school crossing guard. Such refund of contributions shall serve as a waiver of all benefits payable to the employee, to his dependent or dependents, or to any of his beneficiaries under the retirement system.

    h. A temporary employee who is employed under the federal Job Training Partnership Act, Pub.L. 97-300 (29 U.S.C. § 1501) shall not be eligible for membership in the system. Membership for temporary employees employed under the federal Job Training Partnership Act, Pub.L. 97-300 (29 U.S.C. § 1501) who are in the system on the effective date of this 1986 amendatory act shall be terminated, and affected employees shall receive a refund of their accumulated deductions as of the date of commencement of employment in a federal Job Training Partnership Act program. Such refund of contributions shall serve as a waiver of all benefits payable to the employee, to his dependent or dependents, or to any of his beneficiaries under the retirement system.

(cf: P.L.1986, c.139, s.1)

 

    2. Section 27 of P.L.1966, c.217 (C.43:15A-57.2) is amended to read as follows:

    27. [If] a. Except as provided in subsection b. of this section, if a former member of the State Employees' Retirement System or the retirement system, who has been granted a retirement allowance for any cause other than disability, becomes employed again in a position which makes him eligible to be a member of the retirement system, his retirement allowance and the right to any death benefit as a result of his former membership, shall be canceled until he again retires.

    Such person shall be re-enrolled in the retirement system and shall contribute thereto at a rate based on his age at the time of re-enrollment. Such person shall be treated as an active member for determining disability or death benefits while in service and no benefits pursuant to an optional selection with respect to his former membership shall be paid if his death shall occur during the period of such re-enrollment.

    Upon subsequent retirement of such member, his former retirement allowance shall be reinstated together with any optional selection, based on his former membership. In addition, he shall receive an additional retirement allowance based on his subsequent service as a member computed in accordance with applicable provisions of chapter 84 of the laws of 1954; provided, however, that his total retirement allowance upon such subsequent retirement shall not be a greater proportion of his final compensation than the proportion to which he would have been entitled had he remained in service during the period of his prior retirement. Any death benefit to which such member shall be eligible shall be based on his latest retirement, but shall not be less than the death benefit that was applicable to his former retirement.

    b. The provisions of subsection a. of this section shall not apply to a retired member of the retirement system who, while in receipt of a retirement allowance, becomes employed again in a position with the member's employer at the time of retirement which is paid at an hourly rate, so long as the member does not work in such capacity in any calendar year for a number of hours which would result in the member receiving compensation in excess of the amount permitted by the Social Security Administration to be earned without a reduction in Social Security benefits or, in the case of a member who shall have attained an age at which no such reduction is imposed, the amount permitted to be earned without such reduction by a person immediately prior to attainment of that age. Such a member shall not be reenrolled in the retirement system and neither the member nor the employer shall be required to make contributions to the system on the member's behalf. A retired member who becomes reemployed in the manner described in this subsection shall not, by virtue of such employment, be enrolled in the State Health Benefits Plan or in any other employer-sponsored health care plan.

(cf: P.L.1971, c.213, s.45)

 

    3 This act shall take effect immediately.

 

 

STATEMENT

 

    This bill allows a retirant from the Public Employees' Retirement System (PERS) to return to employment in a position covered by PERS without being subject, as under present law, to cancellation of the person's retirement allowance and reenrollment in the retirement system during such reemployment. The bill would apply only to cases in which the reemployment was (1) with the same public employer that employed the person at the time of retirement, and (2) paid at an hourly rate. Neither the member nor the employer would be required to contribute to the retirement system. The member would be ineligible to receive health care benefits by virtue of such reemployment. A member who is reemployed in this manner would be allowed to earn up to the amount permitted by the Social Security Administration to be earned each year without a reduction in Social Security benefits or, in the case of reemployed retirants who have attained an age at which they are not subject to any limit on the amount they may earn without incurring a reduction in those benefits, the amount permitted to be earned without such a reduction by persons immediately prior to their attainment of that age.

    The bill incorporates the provision for limiting the amount of income a person no longer subject to the Social Security benefit offset could receive without incurring discontinuance of pension and reenrollment in the PERS.

 

 

 

Allows PERS retiree to accept hourly employment with employer at time of retirement without loss of retirement benefits.