Cal. Code Regs. Tit. 2, § 572 - Employees Not in a Group or Class of Employment

An employee who is not in a "group or class of employment" within the meaning of the Public Employees' Retirement Law, may request an exception from the "average increase" procedure set forth in Sections 20636 and 20636.1. The local employer may request this exception on the employees behalf.

The request must be submitted in writing, no later than 30 days after the employee first received PERS' estimate of benefits payable. If the estimate is mailed, the 30-day deadline is thirty-five calendar days after the postmark date. The request must be submitted to the:

CUSTOMER ACCOUNT SERVICES DIVISION

PUBLIC EMPLOYEES' RETIREMENT SYSTEM

P.O. BOX 942704

SACRAMENTO, CA 94229-2704

PERS will acknowledge the request in writing, within 15 calendar days of its receipt. PERS will grant or deny the request, and specify its reasons in writing, within 45 days from the date of acknowledgement. PERS' decision to grant or deny the request will be based on a comparison between increased compensation earnable, as reported for the employee during his or her period of final compensation and compensation earnable reported for the group or class of employees in his or her same membership classification.

PERS will review the full history of payroll reporting for the employee, and all relevant payroll reporting for the membership classification, as to both payrate and special compensation. In no case will an exception be granted if PERS determines that the comparative increase in compensation earnable by the employee fails to conform with the following standards set forth in subsections (a) and (b) below as well as other applicable provisions of the law.

(a) If reported in payrate, the increased compensation must be:

(1) Contained in a written labor agreement;

(2) Part of normally-required duties;

(3) Performed during normal hours of employment;

(4) Paid periodically as earned;

(5) Historically consistent with prior payments for the membership classification; and

(6) Not final settlement pay.

(b) If reported in special compensation, the increased compensation must be:

(1) Contained in a written labor agreement;

(2) Part of normally-required duties;

(3) Performed during normal hours of employment;

(4) Paid periodically as earned;

(5) Historically consistent with prior payments for the membership classification;

(6) Listed as special compensation in Section 571; and

(7) Not final settlement pay.

(c) Reported increased compensation must not constitute "final settlement pay" within the meaning of Section 570 and Section 20636 and 20636.1 of the Government Code. It must conform with federal Internal Revenue Code standards in Section 415 for maintaining "qualified plan status" of the System, and in Section 401, including the "non-discrimination testing".

If the request is denied, the employee or employer may appeal PERS' decision to the Board by the procedure set forth in Sections 555.1-555.4, and Section 20134 of the Government Code.

RESEARCH NOTE: Oden v. Public Employees' Retirement System (1994) 23 Cal.App.4th 194 [28 Cal.Rptr.2d 388]; City of Sacramento v. Public Employees' Retirement System (1991) 229 Cal.App.3d 1470 [280 Cal.Rptr. 847]; Santa Monica P.O.A. v. Bd. of Admin. Public Employees' Retirement System (1978) 69 Cal.App.3d 96 [137 Cal.Rptr. 771].

Notes

Cal. Code Regs. Tit. 2, § 572

1. New section filed 7-5-94 as an emergency; operative 7-5-94 (Register 94, No. 27). A Certificate of Compliance must be transmitted to OAL by 11-2-94 or emergency language will be repealed by operation of law on the following day.
2. Certificate of Compliance, including amendment of section heading and text, as to 7-5-94 order transmitted to OAL 10-28-94 and filed 12-14-94 (Register 94, No. 50).
3. Change without regulatory effect amending first and third paragraphs, subsection (c) and NOTE filed 9-22-2011 pursuant to section 100, title 1, California Code of Regulations (Register 2011, No. 38).

Note: Authority cited: Sections 20120- 20124, Government Code. Reference: Sections 20636 and 20636.1, Government Code; IRC Sections 401, 415.

1. New section filed 7-5-94 as an emergency; operative 7-5-94 (Register 94, No. 27). A Certificate of Compliance must be transmitted to OAL by 11-2-94 or emergency language will be repealed by operation of law on the following day.
2. Certificate of Compliance, including amendment of section heading and text, as to 7-5-94 order transmitted to OAL 10-28-94 and filed 12-14-94 (Register 94, No. 50).
3. Change without regulatory effect amending first and third paragraphs, subsection (c) and Note filed 9-22-2011 pursuant to section 100, title 1, California Code of Regulations (Register 2011, No. 38).