Voluntary Retirement Incentive Program

Voluntary Retirement Incentive Program
Modified: 3/26/10 - Final
Voluntary Retirement Incentive
• Optimize workforce alignment with student
needs and university strategic plans
• Minimize disruption of classroom and learning
environment, student services and career
• Improve university cost structure
• Implement a system approach reflecting the
uniqueness of the PASSHE universities
Modified: 3/26/10 - Final
Modified: 3/24/10 - Final
Modified: 3/24/10 - Final
Voluntary Retirement Incentive
General Program Guidelines
• The Board of Governors approved a Voluntary
Retirement Incentive Program at its March 19,
2010 meeting
• The monetary incentives are based upon years
of service and retirement eligibility for all
employee groups
• Participants will be required to sign a release
and settlement agreement prepared by the
PASSHE Office of Legal Counsel
Modified: 3/26/10 - Final
Voluntary Retirement Incentive
General Guidelines (continued)
• Collective bargaining agreement and management leave
payout provisions must be adhered to, including:
• Annual Leave
• Holiday
• Personal Leave
• Sick Leave
• Compensatory Leave
• Employees are encouraged to participate in preretirement counseling
• Payouts will be made based on current payroll practices
Modified: 3/26/10 - Final
Voluntary Retirement
Incentive Program
Eligible Employee Groups Include
• Employees Represented by:
– American Federation of State, County, and Municipal
Employees (AFSCME)
– State College and University Professional Association
– Security, Police, and Fire Professionals of America
– Office of Professional Employees International Union
Healthcare Pennsylvania (OPEIU)
– Pennsylvania Social Services Union (PSSU)
– Management
Modified: 3/26/10 - Final
Voluntary Retirement
Incentive Program
Monetary Incentive
13 to 15 years of service*:
10% of annual base salary with a minimum of $6,000 and a maximum of $10,000
More than 15 years to 20 years of service*:
20% of annual base salary with a minimum of $10,000 and a maximum of $20,000
More than 20 years of service*:
30% of annual base salary with a minimum of $14,000 and a maximum of $30,000
Years of Service, including purchased service, as of date of retirement.
Annual base salary is rate of pay for staff and does not include supplemental pay such as
overtime, compensatory time, etc.
Employees will be paid in a lump sum minus appropriate deductions.
Employees must sign a release and settlement agreement.
Not all bargaining units are eligible for each tier
* Refer to the specific voluntary separation program agreement for each respective union.
Modified: 3/26/10 - Final
Voluntary Retirement
Incentive Program
Eligibility as of Date of Retirement*
Active full-time permanent employee, and;
Age 60 or above, or if under age 60 , a minimum of
35 years of credited service and
Eligible for majority paid annuitant health care
*Date of Retirement must be between June 18th and August 27th.
Annuitant health care benefits are determined by the
applicable collective bargaining agreement for
represented employees and PASSHE policies for nonrepresented employees.
Modified: 3/26/10 - Final
Voluntary Retirement
Incentive Program
Acceptance Period:
March 31, 2010 through May 28, 2010
Separation Date:
June 18, 2010 through August 27, 2010
Employees are encouraged to participate in the Pre-Retirement Counseling
sessions to be offered at their university.
Modified: 3/26/10 - Final
Voluntary Retirement Incentive
Key Resources
• Chief Human Resource Officer
• Benefits Coordinator
• Union Officials
Modified: 3/26/10 - Final
Annuitant Health Plan Eligibility
PEBTF covered (AFSCME):
– With 25 years of service regardless of age; OR
– At age 60 with at least 20 years of service, unless
meet the criteria of the grandfathering provision
of the CBA which grants eligibility with 15 years
(Grandfathering criteria: as of June 30, 2008
had 15 years of service OR had 13 years of
service and were within one year of age 60)
Modified: 3/24/10 - Final
Annuitant Health Plan Eligibility
• PASSHE AHCP (Managers, Police, Nurses, SUA)
– 25 years of service regardless of age
– Age 60 with at least 20, 15, or 10 years of service
dependent upon hire date:
• Hired prior to July 1, 1997, need 10 years of service
• Hired on or after July 1, 1997, need 15 years of service
• Hired on or after July 1, 2004, need 20 years of service
Modified: 3/24/10 - Final
Benefit Changes
Health Insurance
• Loss of dental and vision coverage
• Spouses and dependents covered as long as
annuitant lives
• Must take a monthly annuity payment to qualify
• Cost for REHP(PEBTF) is 2% of active ending salary, to
3% October 1, 2010 (with future % increases)
• Cost for AHCP(PASSHE) is 10% of premium cost at
retirement, to 15% July 1, 2010 (with future %
increases on same premium cost)
Modified: 3/24/10 - Final
Benefit Changes (cont.)
Life Insurance
• Loss of University paid life insurance
• Conversion will be offered, but convert term
life policy to whole life and cost is very high
• Consider your need for life insurance
Voluntary Benefit Programs
• No continuation of LTD
• Option to continue VGLIP for 2 years
Modified: 3/24/10 - Final
Leave Payments
• 100% payout for Annual Leave, Personal Leave, Compensatory
Leave, and Holiday Leave
• % payout for sick leave dependent upon balance:
0-100 days = 30% buy-out
101-200 days = 40% buyout
201-300 days = 50% buyout
Over 300, 100% buyout on days over 300 max of 13/15
• Leave payment can be tax sheltered through the
Commonwealth’s Deferred Compensation (457) Plan through
Great West
Modified: 3/24/10 - Final
Incentive Pay
• Monetary incentive based on years of service
as of the date of retirement
• Years of service includes purchased service as
of date of retirement
• Paid with last check
• Incentive payments are eligible to be tax
sheltered through an existing TSA or by
establishing one prior to payment
Modified: 3/24/10 - Final
Conversion Pay Liability
Many long term employees (hired early 1980’s
or before) have a “conversion pay liability”
which is listed on pay statements, is recouped
upon retirement.
Amount is equal to one biweekly check at the
time of the payroll conversion.
Modified: 3/24/10 - Final
Last Pay
• Last pay normally received two weeks after
your last day of work if you retire on a payday
Friday will include:
– Last biweekly paycheck less all applicable
deductions such as taxes, retirement, health
insurance, voluntary deductions, credit union, etc.
– Leave buy-out less taxes only (unless sheltered)
– Incentive pay less taxes only (unless sheltered)
Modified: 3/24/10 - Final
Last Day
• Be sure to turn in keys, parking tag, and any
other University property
• Email considerations (notify people in your
address book of email termination)
• Delete/transfer to disc any personal
information on your computer
Modified: 3/24/10 - Final
Points to Ponder
• Aside from financial/benefit implications, for
many of you this is more of an emotional
decision; are you mentally prepared to retire?
• Can you see yourself being retired or are you
already thinking about a part-time job?
• More than another year vs. less than another
year? What were you planning?
• Is the incentive money changing your plans?
Modified: 3/24/10 - Final
Points to Ponder (cont.)
• Don’t let others influence your decision
• Make an informed decision
Modified: 3/24/10 - Final
Upcoming Planning Seminars
• Deferred Compensation Program
– April 19 at 10 a.m. at North Hall Welcome Center
• Retirement Strategies for Life
– April 27 at 10 a.m. at North Hall Welcome Center
• Social Security Pre-Retirement Planning
– April 28 at 10 a.m. at North Hall Welcome Center
• SERS Open Session
– May 4 at 10 a.m. at North Hall Welcome Center
Modified: 3/24/10 - Final
New SERS Counselor
Charlene Hearn from the Seneca office
takes over as counselor for Butler County
effective April 5, 2010.
800 633 5461 Ext. 3105
Open session on May 4 at 10 a.m. at
North Hall Welcome Center.
Modified: 3/24/10 - Final
PSERS Contact Information
Toll free number to request a PSERS
888 773 7748
PSERS representatives meet
potential annuitants at the
Intermediate Unit in Grove City.
Modified: 3/24/10 - Final
ARP One-on-One Sessions
For those enrolled in the ARP (TIAA-CREF, VALIC,
ING, or Fidelity):
• Carol Balkey from TIAA-CREF here on May 13,
need to request a Retirement Illustration prior
to an appointment at 800 842 2776
• Contact me if other than TIAA-CREF to set up
an appointment
Modified: 3/24/10 - Final
Next Steps
• Attend pre-retirement counseling sessions
• Contact SERS, PSERS, or your ARP provider
• Meet with your university Chief Human
Resource Officer or Benefit Coordinator
• Purchase prior service, if applicable
Modified: 3/26/10 - Final
Voluntary Retirement Incentive
Modified: 3/26/10 - Final
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