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Oregon Bulletin

March 1, 2013

Oregon Public Employees Retirement System, Chapter 459

Rule Caption: Modification of certain standards concerning employer obligations in verification of retirement data process.

Adm. Order No.: PERS 1-2013

Filed with Sec. of State: 1-25-2013

Certified to be Effective: 1-25-13

Notice Publication Date: 11-1-2012

Rules Amended: 459-005-0040

Subject: OAR 459-005-0040 sets forth the standards PERS follows when an eligible member requests a verification. The “reasonable time” for employers to confirm or modify records is currently 60 days. After this period has passed, the member’s employer may no longer modify that data. PERS then completes the verification.

 The 60-day deadline was established when the data verification process was initiated July 1, 2011. Since that time, a mismatch in time frames has arisen because of the number of members who request data verifications at the same time that they apply for retirement. The 60-day time line for employers to verify data does not allow timely processing of the member’s retirement application, because PERS strives to commence payments within 45 days.

 As the majority of employers respond to data verification work item requests within 30 days, lowering the standard for a response allows for more timely benefit payment processing and removes what has proven to be an unnecessary delay. The rule modifications also shorten the corresponding period during which an employer can petition for a discretionary extension of the deadline from 45 days to 21 days. This change is needed because a 45-day deadline to petition for an extension would fall after the 30-day period had already expired. To date, no petitions for extension have been made by any PERS employers.

Rules Coordinator: Daniel Rivas—(503) 603-7713

459-005-0040

Verification of Retirement Data

(1) For purposes of this rule:

(a) “Eligible member” means an active or inactive member of the system who is within two years of attaining earliest service retirement age or has attained earliest service retirement age. “Eligible member” does not include a retired member of the system, an alternate payee, or a beneficiary.

(b) “Verification” means a document provided to an eligible member by PERS pursuant to ORS 238.285.

(2)(a) PERS will determine an eligible member’s creditable service, retirement credit, final average salary, member account balance, and accumulated unused sick leave for a verification based on employment data reported to PERS by the member’s employers, as reflected in PERS’ records. Except as provided in this section, an employer may not modify an eligible member’s records after the earlier of the 30th day after PERS notifies the eligible member’s employer that a request for a verification has been submitted or the date the employer confirms the records in a manner determined by PERS.

(b) PERS may direct an employer to modify records if PERS determines modification is necessary, such as:

(A) To reconcile the member’s records before the verification is issued;

(B) To implement the resolution of a dispute under ORS 238.285(2); or

(C) To reissue a verification under subsection (4)(e) of this rule.

(c) An employer may petition PERS for an extension of the 30-day period described in subsection (a) of this section.

(A) The petition must:

(i) Be specific to an eligible member;

(ii) Specify the duration and end date of the extension requested;

(iii) Be received by PERS no later than the 21st day after notice is issued; and

(iv) Establish good cause why the extension should be granted.

(B) The PERS Executive Director or a person designated by the Director may grant or deny the request.

(C) An employer may not request more than one extension for an eligible member.

(3) For any verification provided by PERS:

(a) All data in a verification will be as of December 31 of the last calendar year before the date the verification is produced for which the Board has adopted annual earnings crediting.

(b) If an eligible member requests an additional verification, an employer may not confirm or modify, nor may a member dispute, by reason of the additional verification, data for periods before the date specified in the most recent verification.

(4) When a member who has received a verification retires for service, PERS may not use amounts less than the amounts verified to calculate the member’s retirement allowance or pension, except as permitted in ORS 238.285(3) and this section.

(a) Amounts in a verification may be adjusted if a Tier Two member restores forfeited creditable service and establishes Tier One membership in the manner described in ORS 238.430(2)(b).

(b) Amounts in a verification may be adjusted to comply with USERRA.

(c) Amounts in a verification may be adjusted to implement a judgment, administrative order, arbitration award, conciliation agreement, or settlement agreement.

(d) If, subsequent to the date specified in a verification, a member’s account is divided pursuant to ORS 238.465, the member and alternate payee accounts will be used to determine compliance with 238.285(3) and this section.

(e) If the amounts in a verification are adjusted under ORS 238.285(3) or this section, the verification will be reissued by PERS as of the date specified in the original verification.

(5) Erroneous payments or overpayments not recoverable under ORS 238.285(6) will be allocated annually by the Board.

Stat. Auth.: ORS 238.650 & 238A.450
Stats. Implemented: ORS 238.285
Hist.: PERS 11-2010, f. & cert. ef. 11-24-10; PERS 1-2013, f. & cert. ef. 1-25-13


 

Rule Caption: Clarifies employers may use date of hire in determination of method of employee contribution.

Adm. Order No.: PERS 2-2013

Filed with Sec. of State: 1-25-2013

Certified to be Effective: 1-25-13

Notice Publication Date: 1-1-2013

Rules Amended: 459-009-0200

Subject: ORS 238A.335 allows an employer to use MPAT, MPPT, or EPPT for different groups of employees, so long as the employer has a policy or collective bargaining agreement to support any distinction. OAR 459-009-0200 currently requires an employer to apply the method of contribution uniformly to employees who are in similarly situated positions and provides examples of similarly situated positions. The list of examples is not exclusive, but does not include “date of hire” as one of the specifically permissible examples. Employers requested the rule modifications to list a member’s date of hire as a permissible method to differentiate among IAP contribution methods.

Rules Coordinator: Daniel Rivas—(503) 603-7713

459-009-0200

Employer Remitting of Employee Contributions

(1) A participating employer shall remit to PERS in accordance with OAR 459-070-0110 the contributions required by ORS 238A.330. Unless otherwise agreed to as provided for in section (2) or (3) of this rule, the employer shall withhold and remit the required contributions on an after-tax basis as defined in OAR 459-005-0001(2), which shall be known as “member paid after-tax contributions (MPAT)”.

(2) In accordance with Internal Revenue Code (IRC) Section 414(h), and under provision of ORS 238A.335(2)(b), participating employers may voluntarily agree to assume and pay the employee contribution on behalf of its employees, which shall be known as “employer paid pre-tax contributions (EPPT)”. The employer assumption and payment of the employee contributions shall be subject to the following terms and conditions:

(a) The employer’s employment agreement(s) to assume and pay the contributions must be evidenced by a certified copy of the employer’s policy established by statute, charter, ordinance, administrative rule, executive order, collective bargaining agreement, or other written employment policy or agreement. The employer’s employment policy(s) or agreement(s) shall specify that:

(A) The required PERS employee contribution is deemed to be picked up for purposes of IRC Section 414(h)(2) and is assumed and paid for purposes of ORS 238A.335(2)(b);

(B) The employees do not have the option of receiving the assumed amount directly;

(C) Employee compensation may not be reduced and the employer shall provide the additional amounts necessary to make the employee contributions; and

(D) The employer’s employment policy(s) or agreement(s) is not retroactive in its application.

(b) The employer’s employment policy(s) or agreement(s) to assume and pay employee contributions may not be construed to require an employer to open or renegotiate a pre-existing collective bargaining agreement or change an employment policy before its normal expiration date.

(c) The employer’s employment policy(s) or agreement(s) must be to assume and pay the full amount, and not a portion thereof, of the affected employees’ contributions required by ORS 238A.330.

(d) The employer’s policy(s) or agreement(s) may apply to all its employees or some of its employees. If it applies only to some employees, it shall apply uniformly to employees of the public employer who are similarly situated, such as, but not limited to:

(A) The chief executive officer or administrative head of a public employer.

(B) Management personnel, as defined by the public employer, not otherwise covered by a collective bargaining agreement.

(C) Confidential personnel, as defined by the public employer, not otherwise covered by a collective bargaining agreement.

(D) Administrative personnel, as defined by the public employer, not otherwise covered by a collective bargaining agreement.

(E) Personnel covered by a collective bargaining agreement.

(F) Other personnel, whether full time, part time, temporary, or as a substitute, who are not covered by a collective bargaining agreement.

(G) Personnel hired on or after a date established or agreed upon by the employer.

(3) Under provision of ORS 238A.335(2)(a), participating employers may voluntarily agree to “pick-up” the employee contributions withheld, and such picked-up contributions shall be known as “member paid pre-tax contributions (MPPT)”. The employer “pick-up” of the employee contributions shall be subject to the following terms and conditions:

(a) The employer’s agreement(s) to “pick-up” the contributions must be evidenced by a certified copy of the employer’s policy established by statute, charter, ordinance, administrative rule, executive order, collective bargaining agreement, or other written employment policy or agreement. The employer’s policy(s) or agreement(s) shall specify that:

(A) The employees do not have the option of receiving the picked-up amount directly;

(B) The employee compensation shall be reduced by the amount necessary to make the employee contributions; and

(C) The employer’s policy(s) or agreement(s) is not retroactive in its application.

(b) The employer’s employment policy(s) or agreement(s) to “pick-up” employee contributions withheld may not be construed to require an employer to open or re-negotiate a pre-existing collective bargaining agreement or change an employment policy before its normal expiration date.

(c) The employer’s policy(s) or agreement(s) must be to “pick-up” the full amount, and not a portion thereof, of the affected employees’ contributions required by ORS 238A.330.

(d) The employer’s employment policy(s) or agreement(s) may apply to all its employees, or some of its employees. If it applies to only some of its employees, it shall apply uniformly to employees of the public employer who are similarly situated, such as, but not limited to:

(A) The chief executive officer or administrative head of a public employer.

(B) Management personnel, as defined by the public employer, not otherwise covered by a collective bargaining agreement.

(C) Confidential personnel, as defined by the public employer, not otherwise covered by a collective bargaining agreement.

(D) Administrative personnel, as defined by the public employer, not otherwise covered by a collective bargaining agreement.

(E) Personnel covered by a collective bargaining agreement.

(F) Other personnel, whether full time, part time, temporary, or as a substitute, who are not covered by a collective bargaining agreement.

(G) Personnel hired on or after a date established or agreed upon by the employer.

(4) The notification of the employer’s written employment policy(s) or agreement(s) to enter into or to revoke (1) the “pick-up”, or (2) to assume and pay contributions on behalf of employees, shall be submitted to PERS for review and approval, and shall become effective on the date the notification is received by PERS. Additional information related to the employer’s policy or agreement shall be provided at the request of staff and in the manner required by staff. If approved by PERS, such policy and agreement may not be revoked by the employer except with prior written notice to PERS. All costs to correct any errors caused by failure to give required notice shall be borne by the employer.

(5) Notwithstanding sections (1) to (4) of this rule, judge member contributions shall be made in accordance with ORS 238.515.

Stat. Auth.: ORS 238.650 & 238A.450
Stats. Implemented: ORS 238.515, 238A.330 & 238A.335
Hist.: PER 1-1979(Temp), f. & ef. 6-1-79; PER 2-1979, f. & ef. 7-19-79; PER 2-1980, f. & ef. 3-7-80; PERS 1-1996, f. & cert. ef. 3-26-96; Renumbered from 459-010-0208; PERS 7-1999 f. & cert. ef. 11-22-99; PERS 12-2006, f. & cert. ef. 6-26-06; PERS 6-2010, f. & cert. ef. 8-2-10; PERS 2-2013, f. & cert. ef. 1-25-13

Notes
1.) This online version of the OREGON BULLETIN is provided for convenience of reference and enhanced access. The official, record copy of this publication is contained in the original Administrative Orders and Rulemaking Notices filed with the Secretary of State, Archives Division. Discrepancies, if any, are satisfied in favor of the original versions. Use the OAR Revision Cumulative Index found in the Oregon Bulletin to access a numerical list of rulemaking actions after November 15, 2012.

2.) Copyright 2013 Oregon Secretary of State: Terms and Conditions of Use

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