78.5540 Retired member who returns to work with participating employer --
2,610 words·~12 min read·
/ky/78-5540A research copy — for the controlling text, always check the official state or federal source. Not legal advice.
Combination of accounts -- Employment within 12 months of retirement date -
- Independent contractors and leased employees -- Reemployment on or after
September 1, 2008 -- Voided retirement -- Absence of prearranged agreement -
- Volunteer services -- Mayors and members of city legislative bodies --
Administrative regulations.
(1)A retired member whose disability retirement was discontinued pursuant to KRS
78.5528 and who is reemployed by an employer participating in the system or the
Kentucky Retirement Systems prior to his or her normal retirement date shall have
his or her accounts combined upon termination for determining eligibility for
benefits. If the member is eligible for retirement, the member's service and
creditable compensation earned as a result of his or her reemployment shall be used
in the calculation of benefits, except that the member's final compensation shall not
be less than the final compensation last used in determining his or her retirement
allowance. The member shall not change beneficiary or payment option
designations.
(a)If a retired member accepts employment or begins serving as a volunteer with
an employer participating in the systems administered by Kentucky
Retirement Systems or the County Employees Retirement System within
twelve
(12)months of his or her retirement date, the retired member shall
notify the Authority and the participating employer shall submit the
information required or requested by the Authority to confirm the individual's
employment or volunteer status. The retired member shall not be required to
notify the Authority regarding any employment or volunteer service with a
participating agency that is accepted after twelve
(12)months following his or
her retirement date.
(b)If the retired member is under a contract to provide services as an independent
contractor or leased employee to an employer participating in the systems
administered by Kentucky Retirement Systems or the County Employees
Retirement System within twelve
(12)months of his or her retirement date,
the member shall submit a copy of that contract to the Authority, and the
Authority shall determine if the member is an independent contractor or
leased employee for purposes of retirement benefits. The retired member and
the participating employer shall submit the information required or requested
by the Authority to confirm the individual's status as an independent
contractor or leased employee. The retired member shall not be required to
notify the Authority regarding any services entered into as an independent
contractor or leased employee with a participating agency that the employee
enters into after twelve
(12)months following his or her retirement date.
(3)Retired members of the County Employees Retirement System who returned to
work with an employer that participates in the County Employees Retirement
System or Kentucky Retirement Systems prior to September 1, 2008, shall be
governed by the provisions of KRS 61.637(1) to (16).
(4)The following shall apply to retired members of the County Employees Retirement
System who are reemployed on or after September 1, 2008, by an agency participating in the systems administered by the County Employees Retirement System or the Kentucky Retirement Systems:
(a)If a retired member is receiving a retirement allowance from the County
Employees Retirement System, or has filed the forms required to receive a
retirement allowance from the County Employees Retirement System, and is
employed in a regular full-time position required to participate in the County
Employees Retirement System or one
(1)of the systems administered by the
Kentucky Retirement Systems or is employed in a position that is not
considered regular full-time with an employer participating in the County
Employees Retirement System or in one
(1)of the systems administered by
the Kentucky Retirement Systems within one
(1)month following the
member's initial retirement date, the member's retirement shall be voided, and
the member shall repay to the system all benefits received, including any
health insurance benefits. If the retired member is returning to work in a
regular full-time position required to participate in the County Employees
Retirement System:
1. The member shall contribute to a member account established for him or
her in the County Employees Retirement System or in one
(1)of the
systems administered by the Kentucky Retirement Systems, and
employer contributions shall be paid on behalf of the member by the
participating employer to the system; and
2. Upon subsequent retirement, the member shall be eligible for a
retirement allowance based upon total service and creditable
compensation, including any additional service or creditable
compensation earned after his or her initial retirement was voided;
(b)If a retired member is receiving a retirement allowance from the County
Employees Retirement System and is employed in a regular full-time position
required to participate in the County Employees Retirement System or in one
(1)of the systems administered by the Kentucky Retirement Systems after a
one
(1)month period following the member's initial retirement date, the
member may continue to receive his or her retirement allowance during the
period of reemployment subject to the following provisions:
1. If a member is reemployed by a participating employer within twelve
(12)months of the member's retirement date, the participating employer
shall certify in writing on a form prescribed by the Authority that no
prearranged agreement existed between the employee and employer
prior to the employee's retirement for the employee to return to work
with the participating employer. If the participating employer fails to
complete the certification or the Authority determines a prearranged
agreement exists, the member's retirement shall be voided and the
provisions of paragraph
(a)of this subsection shall apply to the member
and the employer. For purposes of this paragraph:
a. If an elected official is reelected to a new term of office in the
same position as the elected official held prior to retirement and
takes office within twelve
(12)months of his or her retirement
date, he or she shall be deemed by the Authority as having a
prearranged agreement; and
b. Employment that is accepted by the retired member after twelve
(12)months following the member's retirement date shall not
constitute a prearranged agreement under this paragraph;
2. Notwithstanding any other provision of KRS Chapter 78 to the contrary,
the member shall not contribute to the system and shall not earn any
additional benefits for any work performed during the period of
reemployment;
3. Except as provided by KRS 70.291 to 70.293, 95.022, and 164.952 and
except for any retiree employed as a school resource officer as defined
by KRS 158.441 or as a Kentucky guardian as defined by KRS
158.4431, the employer shall pay employer contributions as specified by
KRS 78.5536 and 78.635 on all creditable compensation earned by the
employee during the period of reemployment. The additional
contributions paid shall be used to reduce the unfunded actuarial liability
of the system; and
4. Except as provided by KRS 70.291 to 70.293, 95.022, and 164.952 and
except for any retiree employed as a school resource officer as defined
by KRS 158.441 or as a Kentucky guardian as defined by KRS
158.4431, the employer shall be required to reimburse the system for the
cost of the health insurance premium paid by the system to provide
coverage for the retiree, not to exceed the cost of the single premium.
Effective July 1, 2015, local school boards shall not be required to pay
the reimbursement required by this subparagraph for retirees employed
by the board for eighty
(80)days or less during the fiscal year. Effective
August 1, 2024, the Department of Education shall pay for the health
reimbursements required by this subparagraph for a retiree who
participated in a hazardous position prior to July 1, 2003, in the County
Employees Retirement System or in one
(1)of the systems administered
by the Kentucky Retirement Systems, and who is reemployed by a local
school board;
(c)Notwithstanding paragraphs
(a)and
(b)of this subsection, a retired member
who qualifies as a volunteer for an employer participating in the County
Employees Retirement System or the Kentucky Retirement Systems and who
is receiving reimbursement of actual expenses, a nominal fee for his or her
volunteer services, or both, shall not be considered an employee of the
participating employer and shall not be subject to paragraphs
(a)and
(b)of
this subsection if:
1. Prior to the retired member's most recent retirement date, he or she did
not receive creditable compensation from the participating employer in
which the retired member is performing volunteer services;
2. Any reimbursement or nominal fee received prior to the retired
member's most recent retirement date has not been credited as creditable
compensation to the member's account or utilized in the calculation of
the retired member's benefits;
3. The retired member has not purchased or received service credit under
any of the provisions of KRS 78.510 to 78.852 for service with the
participating employer for which the retired member is performing
volunteer services; and
4. Other than the status of volunteer, the retired member does not become
an employee, leased employee, or independent contractor of the
employer for which he or she is performing volunteer services for a
period of at least twelve
(12)months following the retired member's
most recent retirement date.
If a retired member, who provided volunteer services with a participating
employer under this paragraph violates any provision of this paragraph, then
he or she shall be deemed an employee of the participating employer as of the
date he or she began providing volunteer services and both the retired member
and the participating employer shall be subject to paragraphs
(a)and
(b)of
this subsection for the period of volunteer service;
(d)Notwithstanding any provision of this section, any mayor or member of a city
legislative body shall not be required to resign from his or her position as
mayor or as a member of the city legislative body in order to begin drawing
benefits from the systems administered by the Kentucky Retirement Systems
or the County Employees Retirement System or subject to any provision of
this section as it relates solely to his or her service as a mayor or member of
the city legislative body, if the mayor or member of a city legislative body:
1. Has not participated in the County Employees Retirement System prior
to retirement, but is otherwise eligible to retire from the Kentucky
Employees Retirement System or the State Police Retirement System; or
2. Has been or is participating in the County Employees Retirement
System and is at least sixty-two
(62)years of age. If a mayor or member
of a city legislative body who is at least sixty-two
(62)years of age
retires from the systems administered by Kentucky Retirement Systems
or the County Employees Retirement System but remains in office after
his or her effective retirement date, the mayor or member of the city
legislative body shall not accrue any further service credit or benefits in
the systems administered by Kentucky Retirement Systems or the
County Employees Retirement System for any employment occurring
on or after the effective retirement date;
(e)Notwithstanding any provision of this section, any current or future part-time
adjunct instructor for the Kentucky Fire Commission who has not participated
in the Kentucky Employees Retirement System prior to retirement, but who is
otherwise eligible to retire from the County Employees Retirement System,
shall not be:
1. Required to resign from his or her position as a part-time adjunct
instructor for the Kentucky Fire Commission in order to begin drawing
benefits from the County Employees Retirement System; or
2. Subject to any provision of this section as it relates solely to his or her
service as a part-time adjunct instructor for the Kentucky Fire
Commission;
(f)If a member is receiving a retirement allowance from the County Employees
Retirement System and enters into a contract or becomes a leased employee of
an employer under contract with an employer participating in the County
Employees Retirement System or one
(1)of the systems administered by the
Kentucky Retirement Systems:
1. At any time following retirement, if the Authority determines the
employment arrangement does qualify as an independent contractor or
leased employee, the member may continue to receive his or her
retirement allowance during the period of the contract;
2. Within one
(1)month following the member's initial retirement date, if
the Authority determines the employment arrangement does not qualify
as an independent contractor or leased employee, the member's
retirement shall be voided in accordance with paragraph
(a)of this
subsection;
3. After one
(1)month but within twelve
(12)months following the
member's initial retirement, if the Authority determines the employment
arrangement does not qualify as an independent contractor or leased
employee and that a prearranged agreement existed between the member
and the agency for the member to return to work with the agency, the
member's retirement shall be voided in accordance with paragraph
(a)of
this subsection;
4. After a twelve
(12)month period following the member's initial
retirement, the member may continue to receive his or her retirement
allowance during the period of the contract and the member shall not be
required to notify the Authority or submit any documentation for
purposes of this section to the Authority; and
5. After twelve
(12)months or more following the retired member's
retirement date, the initiation of a contract or the initial date of the
leased employment of a retired member by a participating agency shall
not constitute a prearranged agreement under this subsection;
(g)The Authority shall issue a final determination regarding a certification of the
absence of a prearranged agreement or the retired member's qualification as
an independent contractor or leased employee as required under this section
no later than thirty
(30)days after the retired member and participating
employer provide all required forms and additional information required by
the Authority; and
(h)Retired members of one
(1)of the systems administered by Kentucky
Retirement Systems who are reemployed by an employer in the County
Employees Retirement System on or after September 1, 2008, shall not be
eligible to earn a second retirement account in the County Employees
Retirement System for his or her service to the employer.
(5)The Authority shall promulgate administrative regulations to implement the
requirements of this section, including incorporating by reference Authority-
prescribed forms that a retired member and participating agency shall provide the
systems under subsections
(1)and
(4)of this section.
(a)"Reemployment" or "reinstatement" as used in this section shall not include a
retired member who has been ordered reinstated by the Personnel Board under
authority of KRS 18A.095.
(b)1. A retired member who has been ordered reinstated without loss of pay
by the Personnel Board under authority of KRS 18A.095 or by court
order or by order of the Kentucky Commission on Human Rights and
accepts employment by an agency participating in the Kentucky
Employees Retirement System, State Police Retirement System, or
County Employees Retirement System shall void his or her retirement
by reimbursing the system in the full amount of his or her retirement
allowance payments received, including any health insurance benefits
paid to or on behalf of the member.
2. Within twelve
(12)months of the date of the final order of the Personnel
Board, the Kentucky Commission on Human Rights, or the court, the
member shall repay the system the full amount of his or her retirement
allowance payments and health insurance benefits by lump sum or enter
into an agreement with the Authority for repayment by installments.
3. Once the system has been fully reimbursed for the benefits paid to the
member and on the member's behalf, additional contributions and
service credit based on the reinstated employment shall be added to the
member's account.