Office of the State Comptroller
Retirement Services Division

Mandatory Retirement Plan Options for State Teachers and Professional Staff Members in Higher Education - For Agency Reference

This page was last updated on:  December 16, 2013

New Employees Only (No Prior State Employment)

State statutes require that each State of Connecticut employee be covered by a retirement system. This is a mandatory requirement.

An individual employed in a position statutorily defined as a state teacher or a professional staff member in higher education may elect membership in the State Employees Retirement System (SERS) Tier III, the SERS Hybrid Plan, the Alternate Retirement Program (ARP), or, if eligible, the Teachers Retirement System (TRS) within 60 days of their employment. If the employee does not make an election within the 60 days, they must automatically become a member of SERS Tier III. No change to an employee's retirement plan membership is permitted after initial election or following the 60 day default. However, if an employee elects SERS Hybrid Plan or ARP membership and is subsequently employed in a position not eligible for SERS Hybrid Plan or ARP participation, they must be enrolled in SERS Tier III.

Classified employees automatically become members of SERS Tier III.

Special Note: Certain part-time, adjunct faculty members employed at the University of Connecticut or one of the four State Universities also have the one-time, irrevocable option of waiving membership in a retirement plan within 60 days of their employment. Once membership in a retirement plan is waived an employee is no longer eligible to elect to participate in a retirement plan in any subsequent part-time employment with that agency or the Board of Governors of Higher Education or any other of its constituent units within the State of Connecticut including the Community Colleges.

Provided below is a summary of the mandatory retirement systems provided by the State of Connecticut. This information is available for State employees at Connecticut State Employees Retirement Information. Employees should be urged to review specific information regarding each of these systems available as noted below. Remember an employee's retirement plan election is irrevocable unless they elect ARP, the SERS Hybrid Plan or TRS and are subsequently employed in a position not eligible for participation in these plans; under such circumstance their membership in SERS Tier III becomes automatic.

State Employees Retirement System (SERS), Tier III

This is a defined benefit plan qualified under section 401(a) of the Internal Revenue Code. The employee contribution to this plan is 2% of an employee's salary and contributions are made on a pre- tax basis. Should the employee meet the requirements for receipt of a retirement benefit under this plan, the benefit they will receive will be calculated based on a formula which uses the number of years they participated in the plan and the average of their five highest years' salary. Under the Tier III plan, retirement credit may be granted for some prior employment service, including military service and municipal employment. Restrictions apply. See the SERS Tier III Summary Plan Description for more details.

State Employees Retirement System (SERS), Hybrid Plan

This is a defined benefit plan with a “cash out” option qualified under section 401(a) of the Internal Revenue Code. The employee contribution to this plan is 5% of an employee's salary and contributions are made on a pre-tax basis. At the time of retirement the employee will have the option of receiving a retirement benefit calculated based on a formula which uses the number of years they participated in the plan and the average of their five highest years' salary or in lieu of such benefit a one-time lump sum payment with a five percent employer match and four percent interest. Under the Hybrid Plan, retirement credit may be granted for some prior employment service, including military service and municipal employment. Restrictions apply. See the SERS Hybrid Plan Summary Plan Description for more details.

Alternate Retirement Program (ARP)

This is a defined contribution plan qualified under section 401(a) of the Internal Revenue Code. An ARP member's benefit is based upon their contributions to the plan and investment earnings. The employee contribution to the plan is 5% of salary and is made on a pre-tax basis; the State of Connecticut contributes an amount equal to 8% of salary. Plan contributions are invested at the direction of the member in investment funds available under the plan. ING is the State's administrator for ARP. Information on ARP is available at www.CTdcp.com

State Teachers' Retirement System (TRS)

This is a defined benefit plan. If an individual is a part-time employee and their employment is concurrent with employment as a public school teacher, they may elect to have their earnings treated as earnings subject to the Teachers' Retirement System. The employee contribution is 7.25% of salary and is made on a pre-tax basis. Earnings during summer employment do not apply. See plan summary for more details. TRS plan summary information is available on the Teachers Retirement Board's website at http://www.ct.gov/trb/site/default.asp

Employees With Prior Connecticut State Service (Rehires)

Under Section 414(h)(2) of the Internal Revenue Code in order for contributions deducted from compensation to be "picked up" by the employer (and excluded from the employee's taxable income) participation in the retirement plan must be a mandatory condition of employment. The IRS rules allow an employee to waive participation in a mandatory retirement program. However, that choice can only be made on a one-time, irrevocable basis. An employee who fails to opt out within a designated period must automatically be enrolled in a mandatory retirement plan. Part-time lecturers employed by Connecticut Community Colleges do not presently have the option to waive participation in a retirement plan. For IRS compliance purposes, the State (rather than individual colleges or universities) is considered the employer. This means that individual institutions cannot treat each semester of part-time employment as a separate opportunity for retirement plan election or waiver.

Employees with prior state service must rejoin the retirement plan (SERS Tier I, Tier II, Tier IIA or Tier III, SERS Hybrid Plan, ARP or TRS) to which they were previously assigned unless:

Employees with prior state service as part-time faculty during which they were eligible to and elected to waive membership in a retirement plan are ineligible for retirement plan membership during any subsequent part-time faculty employment.

Employees with prior state service as part-time faculty during which they were eligible to and elected to waive membership in a retirement plan who are subsequently rehired in full-time positions should be treated as new employees and offered the retirement plan election options appropriate to their present position.

Employees rehired after a permanent break in service should be treated as new employees and offered the retirement plan election options appropriate to their present position. A "permanent break in service" occurs when an employee who was not vested separates from state service and the elapsed time between such separation and date of reemployment exceeds the greater of five years or the duration of prior service.

Employees whose only prior service consists of public school teaching and who are not currently receiving a retirement benefit from the Teachers Retirement System should be treated as new hires for retirement plan selection purposes.

Dual Employment

Employees who work for another state agency and currently participate in SERS Tier I, Tier II, Tier IIA or Tier III, SERS Hybrid Plan, ARP or TRS are not entitled to change retirement plan participation as a result of accepting supplemental employment and must remain in the retirement plan to which they are assigned at the time of commencing any dual employment.

Employees with full-time positions during which they are members of the TRS must be coded as ineligible for retirement system membership if they are dually employed in a part-time position not includable in TRS.

Employees with full-time positions during which they are members of the ARP must be coded as ineligible for retirement system membership if they are dually employed in a part-time position not eligible for ARP membership.
State Judges who accept part-time positions with a state college or university are not eligible to participate in a retirement plan during this secondary, part-time employment.

Transfers Between Agencies

Employees who transfer from a non-higher education agency to a state college or university unclassified position for the first time are eligible to change their retirement plan membership from SERS Tier I, Tier II, Tier IIA or Tier III to the SERS Hybrid Plan, ARP or, if eligible, TRS. However, such change must take effect with the date of their transfer. There is no window period associated with a transfer of retirement plan membership based upon a change in an employee's work location.

Employees who are members of ARP and transfer from a state college or university to a non-higher education agency must be enrolled in the appropriate SERS tier as of the date of their transfer.

Transfers Between Classified and Unclassified Service within the Same Agency

Employees who transfer from a classified position in a state college or university to an unclassified position for the first time are eligible to change their retirement plan membership from SERS Tier I, Tier II, Tier IIA or Tier III to the SERS Hybrid Plan, ARP or, if eligible, TRS. However, such change must take effect with the date of their transfer. There is no window period associated with a transfer of retirement plan membership based upon a change in an employee's position.

Employees who are members of ARP and transfer from an unclassified position in a state college or university to a classified position must be enrolled in the appropriate SERS tier as of the date of the change in their position.

Reemployed Retirees

Temporarily reemployed SERS and ARP retirees may work a maximum of 120 days in a calendar year without engaging the pension suspension provisions of SERS; a SERS or ARP retiree reemployed in a state teaching position may work up to 45.97% of a full-time teaching schedule without engaging the pension suspension provisions of SERS.

SERS or ARP retirees reemployed in part-time faculty positions are not eligible to rejoin SERS or ARP and are subject to the 120 day/45.97% of a full-time teaching schedule maximum.

A retired TRS member's continued employment in a teaching position is subject to the statutory provisions of the TRS. Such members are not eligible for membership in SERS or ARP. Such employees must complete a Form CO-931h, "Designation of Retirement System-Tier-Plan-Beneficiary", on which their status is indicated as ineligible for retirement plan membership. A copy of their completed TRS Post Retirement Employment Form should be attached to the CO-931h form when provided to the Retirement Services Division. You may refer to the Teachers Retirement Board website at the following link for further information: http://www.ct.gov/trb/site/default.asp 

Click here for instructions on completion of Form CO-931.

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