Under a Section 218 Agreement, a State can exclude from coverage certain services
performed by members of any coverage group including retirement system coverage groups.
If the Agreement does not specifically exclude these services, they are covered. Beginning
July 2, 1991, most services that were optionally excluded under a Section 218 Agreement
are covered by the mandatory coverage provisions unless the employee is covered by
a public retirement system or the services are excluded from mandatory coverage.
EXAMPLE: A City’s Section 218 Agreement excludes part-time positions that require less than
20 hours of work per week. The City’s cafeteria has part-time employees who work part-time
15 ours per week. The City’s retirement system membership is only for employees who
work in full-time positions. Therefore, part-time employees of the cafeteria are subject
to mandatory Social Security and Medicare.