Current through Register Vol. 49, No. 2, February 2024
DEFINITIONS
Covered salary means remuneration paid from a covered
employer to an ATRS retirant on which waiver contributions are paid.
Earnings limitation means the limitation applicable to a
member's retirement annuity when a retiree receives remuneration from a covered
employer.
Normal retirement age means sixty-five (65) years of
age.
Retirant means a member receiving an ATRS retirement
annuity.
Retires means that a member ceases to be active and is
eligible to receive an ATRS annuity.
AGE AND SERVICE RETIRANT
1. If a retirant returns to work service for
a covered employer
1 without rescinding retirement under §
24-7-717, then, for each twelve-month period ending June 30, the amount of the
member's retirement annuity shall be subject to a limitation equivalent to
twice the limitations imposed by the Social Security retirement
test.2
A. A
retirant reaching the System's normal retirement age may return to service
without being subject to the earnings limitations.3
Normal retirement age for the System means sixty-five (65) years of
age.
B. Effective July 1, 1992, a
retirant, who is under normal retirement age, may receive earnings from a
covered employer up to twice the Social Security earnings limitation amount
without affecting his/her ATRS annuity benefits. If his/her ATRS covered
earnings exceed that amount, ATRS will reduce the member's retirement annuity
$1 for each $2 earned in covered salary above the earnings limitation
amount.
C For each year ending June
30, the Social Security retirement test to be considered shall be the test in
effect for the calendar year beginning the January 1 immediately preceding June
30. The retirant's earnings shall be his or her remuneration for the employment
for the year ending June 30.
D
i. For those retirants exceeding the
earnings limitation, the System will suspend annuity payments to collect the
reduction when the earnings limitation is exceeded. If at the end of the fiscal
year, the System has not received from the suspension the amount due from the
retirant exceeding the earnings limitation, the System may carry over
suspension of benefits into the next fiscal year.
ii. Upon written request by the retirant upon
reemployment, the System may initiate an equal monthly reduction of the
retirant's retirement annuity in the fiscal year in which the earnings
limitation will be exceeded to collect the earnings limitation
reduction.
iii. The amount
recovered by ATRS will not exceed the amount of benefits paid during the
year(s) in which the earnings limitation is/was exceeded.
iv. In extraordinary hardship circumstances,
the retirant may request an alternate method of repayment other than total
suspension of benefits for a violation of the earnings limitation.
v. For questions not covered by this rule,
see Rule No. 9-7 (Error Corrections and Collection of
Overpayments).
2.
A. Upon
acceptance of employment with a covered employer, the retirant and employer
must report to ATRS that the retirant has returned to covered employment. A
Statement of Employment form must be completed immediately by employers and
retirants upon acceptance of employment for each retirant hired in a position
covered by ATRS.
B. Employers will
report monthly all retirants who have returned to employment in an ATRS covered
position. The monthly report will be filed on a Return to Service form, which
will be furnished by ATRS.
C. In
the event that both a retirant and employer fail to notify the System of a
retiree's return to covered employment, any retirement benefits paid in
violation of this policy during the time of employment are subject to
collection by the System under the overpayment policy. ATRS reserves the right
to immediately suspend the retirement annuity until all benefits overpaid to
the retirant are repaid to the System.
3.
A.
Effective July 1, 1977, a retirant may receive remuneration as an employee from
any private employer or as a member of the General Assembly without any effect
on his/her annuity.4
B. Effective July 1, 1991, an age and service
retiree may be employed by a public employer whose employees are not covered by
ATRS without any effect on his/her annuity.
4. When a retirant returns to covered
employment and does not rescind his/her retirement, the retirant shall not
accrue additional service credit in the System, and no contributions shall be
remitted on behalf of the retirant.5
5. For the return to work rules applicable to
disability retirees receiving benefits under § 24-7-704, see Policy No.
9-3.
WAIVER OF EARNINGS LIMITATION
1.
A. In
accordance with Act 30 of 1999 and Act 1146 of 2001 as amended by Act 911 of
2005 and with rules and regulations adopted by the State Board of Education,
the Arkansas Department of Education (ADE) may request of the ATRS Executive
Director a waiver of the conditions subjecting annuities to the ATRS earnings
limitation.
B. All requests for
waiver must originate with ADE and be submitted to the ATRS Executive Director
for approval within sixty (60) days of employment. If approved, the waiver
shall be effective for one (1) year from the date of hire or until the end of
the current fiscal year, whichever comes first, with the option to renew
annually for up to a total of three (3) years as requested by ADE. Waiver
renewals are not automatic and any extensions must be approved by the ATRS
Executive Director.
C. Waiver
requests (1) initiated by the employer prior to the member's effective date of
retirement or (2) filed within thirty (30) days following the member's
effective date of retirement will not be eligible for consideration by
ATRS.
D. Effective for the fiscal
year beginning July 1, 2006, retirants who have completed the 10-year maximum
duration period allowed under T-DROP will not be eligible for a
waiver.
2. Effective
July 1, 2005, under Act 911 of 2005, the ATRS Executive Director is authorized
to take appropriate action on waivers of the ATRS earnings limitations
requested by the Department of Education:
A.
If the retiree is hired by a public school district due to a shortage of
certified teachers in a critical academic area in which the retiree is
certified; OR
B. If the retiree is
hired as a superintendent due to a reconstitution or reorganization of a public
school district as allowed in A.C.A. § 6-15-201 et.seq., § 6-15-401
et.seq., or § 6-20-1901 et.seq. following an appropriate determination by
the State Department of Education that:
i. The
public school district has failed to meet standards of accreditation pursuant
to A.C.A. § 6-15-201 et.seq.; OR
ii. The public school district is in academic
distress status for failing to meet the minimum level of academic achievement
on the ACTAAP examinations pursuant to A.C.A. § 6-15-401 et.seq.;
OR
iii. The public school district
is in fiscal distress status pursuant to A.C.A. § 6-20-1901 et.seq.;
AND
iv. An appropriately qualified
applicant, as determined by the State Department of Education, who is not an
ATRS-covered retirant is not available to be employed.
3. Critical academic areas in
which there is a shortage of certified teachers shall be determined annually by
the State Department of Education.
4. Employers shall maintain audit files
identifying personnel granted a waiver and documenting the reasons for the
waiver and will be responsible for reporting to ATRS, all retirees who have
returned to employment under these provisions.
5. Beginning July 1, 2005, a covered employer
who employs a retired member who is approved for a waiver under this policy
shall remit to the System an amount equal to the combined employee and employer
contributions rate in effect at the time of the employment. This waiver fee
shall be paid on all covered salary earned in the fiscal year and shall not be
charged to or collected from the retirant. These amounts shall be recorded by
the System in the ADE Waiver Income Account. (Act 911 of 2005).
Amended: June 15, 2004 July 18, 2005 October 4, 2005
December 6, 2005 June 19, 2007
1 Prior to July 1, 1991, the earnings
limitation applied to retirants who were
* Employees with ATRS, ASHERS, or ASERS from 7-1-71 through
6-30-77;
* Employees with a public employer, whose employers are covered by a
state-supported retirement plan or the University of Arkansas from 7-1-77
through 6-30-78;
* Employees of a public employer whose employees are covered by a
retirement plan supported wholly or in part by state contributions from 7-1-78
through 6-30-91.
2 The Social Security earnings limitation
ceases upon reaching Social Security "full retirement age" as defined P.L.
106-182,
3 In establishing an equivalent limitation
for the System, ATRS considers full retirement age to be the "normal retirement
age" for the System under A.C.A. § 24-7-202(19).
4 From 7-1-71 through 6-30-77 this
"exemption" covered employees receiving remuneration "from any other public
employer or private employer."
5 Act 1293 of 1995 provided that if a
retirant is employed in a covered position by a public college, university, or
vocational-technical school, his/her annuity shall not be subject to the
limitations provided in No. 1 above. This exemption was repealed by Act 384 of
1997, effective July 1, 2007.
