RETIREMENT SERVICES DIVISION MEMORANDUM 2018-01

January 18, 2018

TO THE HEADS OF ALL STATE AGENCIES

 
I. INTRODUCTION

On December 14, 2017, the Retirement Services Division issued Memorandum 2017-05, notifying agencies that, as a result of the delayed ratification of the SEBAC 2017 agreement, increases in the retirement contributions for members of the SERS Tier I, Tier II, Tier IA and Tier III plans were forthcoming. The present memorandum augments the information provided in Memorandum 2017-05 by advising agencies on the use of the new CORE-CT payroll codes developed to implement the retroactive payment of the respective mandatory retirement contribution increases (?Catch-Up Contributions?) and updating the date on which the Catch-Up Contributions will commence.

Members of the SERS Tier IV plan must also make increased Catch-Up Contributions. The process and timeline for implementing the Tier IV Catch-Up Contributions will be addressed in a separate memorandum.

II. GENERAL INFORMATION

As discussed in Memorandum2017-05, the 2017 SEBAC agreement provided for the increase in retirement contribution rates for all SERS Tier I, Tier II, Tier IIA and Tier III (including Hazardous Duty and Hybrid) members by an additional 1.5% of salary effective July 1, 2017 and the delay in ratifying the agreement resulted in the increase in the contribution rates not occurring until the pay period commencing September 1, 2017. Accordingly, the mandatory Catch-Up Contributions due for the period of July 1, 2017 through August 31, 2017 must be collected.

The collection of the mandatory Catch-Up Contributions for SERS Tier I, Tier II, Tier IIA and Tier III members will commence with check dated February 2, 2018¹ and will continue for the remaining 11 biweekly check dates through June 30, 2018.

III. Core-CT HMRS Catch-Up Deduction Retirement Coding

CORE-CT payroll codes have been updated to enable the collection of the Catch-Up retirement contributions due for the period of July 1, 2017 through August 31, 2017. The New Catch-Up Deduction codes that will correspond with the SERS member's retirement deduction are as follows.

The Catch-Up Deduction corresponds with an employee's Retirement Deduction. For example, if an employee is part of the RSE2A SERS Tier II A Plan, the corresponding Catch-Up Deduction is CD2ASE. These new Catch-Up codes will be available for viewing purposes only in the Create General Deduction Screen for agency personnel and payroll users.

The Division will contact employees who have retired between July 1, 2017 and January 1, 2018 to recoup any outstanding mandatory retirement contribution due. For anyone who retires on 2/1/18 to 7/1/18 (before all of the Catch-Up deductions have been recouped), the employing agency will need to calculate the total amount of Catch-Up deductions to be collected as a lump sum from the last paycheck.

CORE-CT will issue a Job Aid titled "Capturing the Missed 1.5% Pension Deduction Increase at Retirement" providing step by step instructions of how to implement this process.

III. CONCLUSION

Please note that it is the responsibility of each state agency to inform employees that the mandatory Catch-Up of retirement contributions will commence with check dated February 2, 2018.

If there are any questions regarding the information provided herein you may address them to Colin Newman, Assistant Division Director at (860) 702-3482 or by email at colin.newman@ct.gov.

Very truly yours,

STATE EMPLOYEES RETIREMENT COMMISSION
KEVIN LEMBO, SECRETARY EX OFFICIO

BY:

John Herrington, Director
Retirement Services Division

JH/cn

¹ Memorandum 2017-05 stated that the Catch-Up retirement contributions would commence on check date January 19, 2018. That date has now been pushed back by one pay cycle.

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