Employee Contributions

PURPOSE: This rule clarifies the nature of payroll contributions required from employees both in counties which are members of the Local Government Employees’ Retirement System and those counties which are not members of the Local Government Employees’ Retirement System. (1) A participant who is not a member of Local Government Employees’ Retirement System (LAGERS) is subject to a two percent (2%) monthly payroll deduction beginning with the first payroll period after the participant’s entry date; except that, for each payroll period ending after December 31, 2002, a participant who is not a member of LAGERS and who is hired or rehired by a county on or after February 25, 2002, is subject to a monthly payroll deduction of not less than two percent (2%) and not more than six percent (6%), in accordance with sections 50.1020(6) and 50.1040(2), RSMo and with 16 CSR 502.080. Any payroll deduction described in this section shall constitute the participant’s required contribution to the plan and shall be designated as an employer “pick-up” contribution, as described in section 414(h)(2) of the Internal Revenue Code. A participant may not waive this contribution, or terminate this contribution requirement by opting out of the plan. (2) For each payroll period ending after December 31, 2002, participants who are members of LAGERS and who are hired or rehired by a county on or after February 25, 2002, are subject to a monthly payroll deduction not to exceed four percent (4%), in accordance with sections 50.1020(6) and 50.1040(2), RSMo and 16 CSR 50-2.080. Any payroll deduction pursuant to this section shall constitute the participant’s required contribution to the plan and shall be designated as an employer “pick-up” contribution, as described in section 414(h)(2) of the Internal Revenue Code. A participant may not waive this contribution, or terminate this contribution requirement by opting out of the plan. (3) Contributions Required from Part-Time or Seasonal Employees. Participants have two (2) options with regard to the prior service earned while they are still qualifying for entry into the plan. A participant must make his or her election to either forego or purchase this prior service as outlined in subsections (A) and (B) upon their entry into the plan at the first available entry date. Such participant may either— (A) Forego those months of prior service and accrue eight (8) years of service from their entry into the plan; or (B) A participant who is a member of LAGERS and who is hired by a county on or after February 25, 2002, may purchase prior service earned on or after January 1, 2003 at the rate of four percent (4%) times the total compensation earned during this prior service period. A participant who is a member of LAGERS is not required to purchase prior service earned on or before December 31, 2002. A participant who is not a member of LAGERS and who is hired by a county on or after February 25, 2002, may purchase prior service earned on or after January 1, 2003 at the rate of six percent (6%), and service earned before January 1, 2003 at the rate of two percent (2%), times the total compensation earned during this prior service period. Any other participant who is not a member of LAGERS may purchase the prior service at the rate of two percent (2%) times the total compensation earned during this prior service period. Participants selecting this option may purchase the prior service with a lump-sum contribution or through periodic payroll deductions, in accordance with such procedures as established by the board, in addition to the regular periodic payroll deduction. If the participant elects to purchase the prior service with an additional payroll deduction, then the deduction shall not extend longer than the period of prior service being purchased. (4) A participant shall not be eligible for a benefit under this plan until all contributions and other payments required by law have been received on behalf of a participant. (5) When a participant receives a refund of contributions from LAGERS, pursuant to section 70.690, RSMo, the county clerk shall forward a copy of the LAGERS report of the refund to the plan administrator of County Employees’ Retirement Fund (CERF) to notify CERF of the change in the participant’s LAGERS status. The participant’s service for the period refunded shall become non-LAGERS service and shall be calculated as such for purposes of the participant’s retirement annuity and any purchase of prior service related thereto. The participant is responsible for notifying CERF of his or her intention to apply for a section 70.690 refund and for verifying that the information on any retirement information received from CERF is correct with respect to the participant’s LAGERS or non-LAGERS status. If the participant fails to notify CERF of an incorrect LAGERS status on his or her retirement paperwork, the participant will be subject to the provisions of sections 50.1034 and 50.1036, RSMo. AUTHORITY: section 50.1032, RSMo 2000.* Original rule filed Oct. 11, 1995, effective May 30, 1996. Amended: Filed July 29, 1997, effective Jan. 30, 1998. Amended: Filed June 1, 1999, effective Nov. 30, 1999. Rescinded and readopted: Filed Sept. 29, 2000, effective March 30, 2001. Amended: Filed Dec. 10, 2002, effective June 30, 2003. Amended: Filed June 4, 2010, effective Dec. 30, 2010. *Original authority: 50.1032, RSMo 1995.