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HR Answers A - Z
Retirement Program
- Full-time appointments which exceed six months, and half-time appointments averaging 20 hours per week for one year or longer, are enrolled in the California Public Employees' Retirement System (CalPERS). CalPERS is a defined benefit plan and is coordinated with Social Security, meaning that employees are eligible for benefits from the retirement system as well as full Social Security benefits. CalPERS members contribute 5% of gross monthly income in excess of $513.00 (Gross Income - $513 x 5%) to the plan.
- The CalPERS 2%@55 booklet is available online at:
http://www.calstate.edu/Benefits/pdf/CalPERS_Pub-6-booklet.pdf - The university also contributes a percentage in excess of the employee’s contribution. This percentage can change July 1 of each fiscal year. For the current fiscal year (2007/08), the CSU contribution rate is 16.63%.
- As members of CalPERS, employees also contribute 6.20% to Social Security and 1.45% to Medicare. The maximum earnings on which an employee pays Social Security tax is $102,000. There is no limit on the earnings upon which Medicare is withheld.
- Peace Officer/Firefighter Category [3% at Age 50]
- The CSU pays the full share of all Public Safety Officers’ employee contributions. Those appointed as Management Personnel Plan (MPP) Public Safety Directors and Lieutenants contribute 8% in excess of $238.00 of their monthly salary. Public Safety personnel hired on or after April 1, 1986 contribute 1.45% of their gross salary towards the Medicare tax. Members not covered under Social Security while in state service are covered under the 1959 Survivor Benefit. There is a $2.00 payroll deduction for this coverage.
- The CalPERS Public Safety Retirement Booklet is online:
http://www.calstate.edu/Benefits/pdf/CalPERS_Pub7-booklet.pdf - All CalPERS member contributions currently earn 6% interest per year. CalPERS provides each employee with a tax-free $5,000 group term life insurance policy in addition to other death benefits. Employees are eligible to retire and receive a monthly pension warrant at age 50 with a minimum of five years of CalPERS-credited service.
- For more information: http://www.calstate.edu/benefits/retirement/cr.page.shtml or http://www.calpers.ca.gov.
- Part-Time, Seasonal and Temporary Employees:
- The Federal Omnibus Budget Reconciliation Act (OBRA) of 1990 requires all employees who do not qualify for participation in the California Public Employees’ Retirement System, be automatically enrolled in the Part-time/Seasonal/Temporary (PST/DPA) Plan. PST participants contribute 7% of their monthly salary to an account on a pre-taxed basis in lieu of contributing to Social Security. Employees could be exempt from membership in the PST plan if currently contributing to CalPERS through another state employer.
- For more information on the PST plan, go to:
http://www.sppforu.com.