BASIC (12-03)

SL 30001.340 Retirement System Ineligibles

 

A. DEFINITION OF RETIREMENT SYSTEM INELIGIBLE

 

An ineligible is an employee who performs services in a position under a retirement system but who is personally ineligible for membership in that system because of a personal disqualification, e.g., age, length of service, number of hours worked, or date of hiring. (Another employee who has no such personal disqualification from membership who occupies the same position would be eligible for membership in that retirement system.)

 

For purposes of extending coverage, the individual must meet the definition of ineligible at a critical time point. These are:

  • Employee must be an ineligible on September 1, 1954, or, if later, the date the agreement is made applicable to the employee’s coverage group or the date the employee first occupied the position under the retirement system. Therefore, an employee who had an option to join the retirement system on September 1, 1954, or if later, the date the employee first occupied the position, would not be considered an ineligible, even though such option expired before a referendum is held.

  • For divided vote retirement systems, an employee is an ineligible for coverage purposes if the employee is ineligible for retirement system membership as of August 1, 1956, or, if later, the date the employee first occupied his/her position.

  • An employee of an interstate instrumentality is an ineligible if the employee has such status as of August 30, 1957, or, if later, the date the employee first occupied his/her position.

 

B. PROVIDING COVERAGE FOR INELIGIBLES

 

Ineligibles do not in themselves constitute a separate coverage group. They may be covered with other employees in one of three ways:

  • As a part of, or as an addition to, an absolute coverage group;

  • As a part of a retirement system group which covers all positions under the retirement system (majority-vote referendum); and

  • As part of, or as an addition to, a divided vote retirement system coverage group composed primarily of those members of a retirement system who chose coverage.

 

The State must specify in the modification whether coverage of ineligibles will continue or terminate if they later become eligible for membership in the retirement system and it is not covered under a Section 218 Agreement. This choice may be made as a part of the basic agreement for all ineligibles or selectively with respect to each coverage group at the time the ineligibles are covered. Such coverage cannot be terminated if the retirement system has been covered under a Section 218 Agreement or if the ineligible would be a member of a divided retirement system coverage group composed of members of the “yes” group.

 

C. COVERING INELIGIBLES WITH THE ABSOLUTE COVERAGE GROUP

 

Ineligibles, other than ineligibles in police officer and firefighter positions, who are not already covered may be covered as a part of, or as an addition to, their absolute coverage group. If the absolute coverage group is now being included under the agreement, the ineligibles can be included as a part of the coverage group. The same effective date of coverage and the same optional exclusions apply to all the employees in the coverage group including the ineligibles.

 

If the absolute coverage group is already covered, the ineligibles may be covered (by a modification) as an addition to that coverage group. The optional exclusions already taken for the coverage group apply also to the ineligibles. The State may select the same effective date of coverage as was provided for the absolute coverage group or it may choose a different effective date of coverage for the ineligibles. The effective date must be consistent with Federal and State laws. The effective date of coverage for the ineligibles cannot be earlier than the effective date of coverage for the other employees in the absolute coverage group.

 

D. COVERING INELIGIBLES WITH MAJORITY VOTE RETIREMENT SYSTEM GROUP

 

Ineligibles who are not already covered are automatically covered when a retirement system coverage group made up of all employees in positions under the retirement system is brought under the agreement. Thus, ineligibles who are not covered with an absolute coverage group are covered if a retirement system coverage group which includes all positions under the retirement system is brought under the agreement through a majority-vote referendum and their services or positions are not optionally excluded from the retirement system coverage group.

 

E. COVERING INELIGIBLES OF A DIVIDED RETIREMENT SYSTEM WHO VOTE FOR COVERAGE

 

A State may provide coverage for ineligibles of a retirement system either as additional services to a retirement system coverage group already included under the agreement or may provide the coverage at the time coverage is first provided for the retirement system coverage group. These ineligibles do not have the right of individual choice. If the ineligibles are included as a part of or an addition to the retirement system coverage group, all the ineligibles are mandatorily covered.

 

Note: This provision does not apply to police officers or firefighters who are in positions under a retirement system but who are ineligible to become members.

 

1. Covering Ineligibles under a Covered Retirement System

 

If the State wishes to include the services of ineligibles as additional services to the retirement system coverage group included under the agreement, any optional exclusion exercised for the retirement system coverage group will also be applicable to the ineligibles. Coverage may be effective retroactively to any date authorized under Federal law (Section 218(e)(1)) and State law. However, the effective date provided may not be earlier than that established for the retirement system coverage group.

 

2. Covering Ineligibles under Retirement System Now Being Covered

 

If the State wishes to cover the services of ineligibles where a retirement system coverage group composed of positions of members desiring coverage is initially being included under the agreement, the State may include the positions of ineligibles as part of this coverage group. The same optional exclusions and the same effective date are applicable.

 

3. Modification Language

 

A modification including the services of ineligibles under this procedure would ordinarily provide the continuation of coverage in the event the ineligible becomes eligible to be a member of the retirement system. (A State may have already made this election on a statewide basis or may now do so.) The coverage of an ineligible brought under the agreement pursuant to this provision will not terminate when he/she becomes eligible if (1) he becomes a new member of the retirement system or (2) he becomes an optional and optionals are already included as part of the retirement system coverage group.

 


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http://policy.ssa.gov/poms.nsf/lnx/1930001340
SL 30001.340 - Retirement System Ineligibles - 12/18/2003
Batch run: 01/27/2009
Rev:12/18/2003