November 25, 2008 Public Pension Transparency Legislation (Municipalities)
KEEPING YOU INFORMED…
We are writing to advise you of recent amendments to Retirement and Social Security Law (“RSSL”) §§ 111, 211, 411.
1. Changes Related to Waivers for Employment of a Retiree (RSSL § 211)Pursuant to the amendments to § 211(2)(b), an employer’s written request for a waiver must provide the following information:
RSSL § 211 sets forth the circumstances under which an employer can obtain a waiver permitting retired public employees who are under the age of 65 and receiving a pension to return to work in the public sector. By obtaining a waiver pursuant to RSSL § 211, a retiree under the age of 65 may earn an amount exceeding the statutorily set cap of $30,000. There are no earnings limitations for individuals 65 or over (RSSL § 212).
Pursuant to the amendments to § 211(2)(b), an employer’s written request for a waiver must provide the following information:
(a) that the retiree is qualified, competent and physically fit and, if certification is required, that the retiree is properly certified;
(b) the employer’s detailed recruitment plan to permanently fill the position;
(c) that the employment of the retiree is in the employer’s best interest; and
(i) that the retiree, who is to be hired on a non-permanent basis, is needed because there is an “unplanned, unpredictable and unexpected” vacancy in a position and not enough time to find another qualified applicant;
(ii) the employer engaged in “extensive recruitment efforts” and has found no available non-retired persons qualified to fill the position.
With respect to the need to undertake “extensive recruitment efforts,” both the Governor’s Approval Memorandum 46 (“Approval Memo”) and the Civil Service Commission Guidelines For Approval Of Requests Pursuant to Retirement and Social Security Law Section 211 state that the recruitment plan will be analyzed based on the specific circumstances of each case and that frivolous recruitment efforts will not be required.
The new amendments also preclude an employer from hiring, for a period of one year, a retiree pursuant to a § 211 waiver for “the same or similar position” that the retiree held immediately prior to his or her retirement. The Approval Memo states that this provision should not “be read to bar an employer from hiring a recent retiree under a 211 waiver merely because the same types of skills are required for the new position and the work the individual previously performed.” A determination of what constitutes a “same or similar position” will be made on a case-by-case basis. Below is a quick reference chart for employers to use to determine when the one-year restriction is potentially applicable pursuant to the new law:
|Under 65||65 or Over|
|$30,000 and Under||No one-year restriction (RSSL § 212)||No one-year restriction (RSSL § 212)|
|Over $30,000||One-year restriction if same or similar position (RSSL § 211)||No one-year restriction (RSSL § 212)|
The new bill contains a “grandfather” clause pursuant to which the new amendments to RSSL § 211 do not apply to any individual for whom a § 211 waiver was in effect prior to October 7, 2008.
2. New Penalties For Attempts to Defraud Pension Systems (RSSL §§ 111, 411)
RSSL §§ 111 (employees’ retirement system) and 411 (policemen’s and firemen’s retirement system) were amended to enhance the penalties for defrauding the pension systems. Previously, any person who was found to have made a false statement, falsified a record, or permitted a record to be falsified in an attempt to defraud the system was guilty of a misdemeanor. Now, a fraudulent act that results in a member or beneficiary receiving a benefit that is greater than the amount to which (s)he would be entitled is a Class E felony if the member or beneficiary receives more than $1,000 to which s(he) is not entitled and a Class D Felony if s(he) receives more than $3,000 to which s(he) is not entitled (RSSL § 111(2)(b); RSSL § 411(2)(b)).
THIS MEMORANDUM IS MEANT TO ASSIST IN GENERAL UNDERSTANDING OF THE CURRENT LAW. IT IS NOT TO BE REGARDED AS LEGAL ADVICE. THOSE WITH PARTICULAR QUESTIONS SHOULD SEEK THE ADVICE OF COUNSEL.
© Lamb & Barnosky, LLP, 2009