161.605 Resumption of employment by retired member -- Continuation of retirement allowance -- Waiver of annuity -- Nonteaching employment.

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161.605 Resumption of employment by retired member -- Continuation of retirement allowance -- Waiver of annuity -- Nonteaching employment. Any member retired by reason of service may return to work in a position covered by the <br>Kentucky Teachers' Retirement System and continue to receive his or her retirement <br>allowance under the following conditions: <br>(1) Any member who is retired with thirty (30) or more years of service may return to work in a full-time or a part-time position covered by the Kentucky Teachers' <br>Retirement System and earn up to a maximum of seventy-five percent (75%) of the <br>member's last annual compensation measured on a daily rate to be determined by <br>the board of trustees. For purposes of determining whether the salary of a member <br>returning to work is seventy-five percent (75%) or less of the member's last annual <br>compensation, all remuneration paid and benefits provided to the member, on an <br>actual dollar or fair market value basis as determined by the retirement system, shall <br>be considered. Members who were retired on or before June 30, 2002, shall be <br>entitled to return to work under the provisions of this section as if they had retired <br>with thirty (30) years of service. Nonqualified service credit purchased under the <br>provisions of KRS 161.5465 or elsewhere with any state-administered retirement <br>system shall not be used to meet the thirty (30) year requirement set forth in this <br>subsection. Out-of state teaching service provided in public schools for kindergarten <br>through grade twelve (12) may count toward the thirty (30) year requirement set <br>forth in this subsection even if it is not purchased as service credit, if the member <br>obtains from his or her out-of-state employer certification of this service on forms <br>prescribed by the retirement system; (2) Any member who is retired with less than thirty (30) years of service after June 30, 2002, may return to work in a full-time or part-time position covered by the <br>Kentucky Teachers' Retirement System and earn up to a maximum of sixty-five <br>percent (65%) of the member's last annual compensation measured on a daily rate <br>to be determined by the board of trustees. For purposes of determining whether the <br>salary of a member returning to work is sixty-five percent (65%) or less of the <br>member's last annual compensation, all remuneration paid and benefits provided to <br>the member, on an actual dollar or fair market value basis as determined by the <br>retirement system, shall be considered; (3) Reemployment of a retired member under subsection (1) or (2) of this section in a full-time teaching or nonteaching position in a local school district shall be <br>permitted only if the employer certifies to the Kentucky Teachers' Retirement <br>System that there are no other qualified applicants available to fill the teaching or <br>nonteaching position. The employer may use any source considered reliable <br>including but not limited to data provided by the Education Professional Standards <br>Board and the Department of Education to determine whether other qualified <br>applicants are available to fill the teaching or nonteaching position. The Kentucky <br>Board of Education shall promulgate administrative regulations to establish <br>procedures to determine whether other qualified applicants are available to fill a <br>teaching or nonteaching position and, if not, for filling the position with a retired <br>member who will then be permitted to return to work in that position under subsection (1) or (2) of this section. The administrative regulations shall assure that <br>a retired member shall not be hired in a teaching or nonteaching position by a local <br>school district until the superintendent of the school district assures the Kentucky <br>Teachers' Retirement System that every reasonable effort has been made to recruit <br>other qualified applicants for the position on an annual basis; (4) Under this section, an employer may employ full-time a number of retired members not to exceed three percent (3%) of the membership actively employed full-time by <br>that employer. The board of trustees may reduce this three percent (3%) cap upon <br>recommendation of the retirement system's actuary if a reduction is necessary to <br>maintain the actuarial soundness of the retirement system. The board of trustees <br>may increase the three percent (3%) cap upon a determination that an increase is <br>warranted to help address a shortage in the number of available teachers and upon <br>the determination of the retirement system's actuary that the proposed cap increase <br>allows the actuarial soundness of the retirement system to be maintained. For <br>purposes of this subsection, "full-time" means the same as defined by KRS <br>161.220(21). A local school district may exceed the quota established by this <br>subsection by making an annual written request to the Kentucky Department of <br>Education which the department may approve on a year-by-year basis if the <br>statewide quota has not been met. A district's written request to exceed its quota <br>shall be submitted no sooner than two (2) weeks after the start of the school year; (5) A member returning to work in a full-time or part-time position under subsection (1) or (2) of this section will contribute to an account with the retirement system <br>that will be administered independently from and with no reciprocal impact with the <br>member's original retirement account, or any other account from which the member <br>is eligible to draw a retirement allowance. A member returning to work under <br>subsection (1) or (2) of this section shall make contributions to the retirement <br>system at the rate provided under KRS 161.540. The new account shall <br>independently meet the five (5) year vesting requirement as well as all other <br>conditions set forth in KRS 161.600(1) before any retirement allowance is payable <br>from this account. The retirement allowance accruing under this new account shall <br>be calculated pursuant to KRS 161.620(1)(b). This new account shall not entitle the <br>member to a duplication of the benefits offered under KRS 161.620(7) or 161.675, <br>nor shall this new account provide the benefits offered by KRS 161.520, 161.525, <br>161.620(3), 161.655, 161.661, or 161.663. A member returning to work under <br>subsection (1) or (2) of this section shall waive his or her medical insurance with <br>the Kentucky Teachers' Retirement System during the period of reemployment and <br>shall receive the medical insurance coverage that is generally provided by the <br>member's active employer to the other members of the retirement system that the <br>active employer employs. If medical insurance coverage is not available from the <br>employer, the Kentucky Teachers' Retirement System may provide coverage for the <br>member. A member returning to work under subsection (1) or (2) of this section <br>shall not be eligible to purchase service credit for any service provided after the <br>member's effective date of retirement but prior to the date that the member returns <br>to work. A member returning to work under subsection (1) or (2) of this section <br>shall not be eligible to purchase service credit that the member would have otherwise been eligible to purchase prior to the member's initial retirement. A <br>member who returns to work under subsection (1) or (2) of this section, or in the <br>event of the death of the member, the member's estate or applicably designated <br>beneficiary, shall be entitled, within ninety (90) days of the posting of the annual <br>report submitted by the employer, to a refund of contributions as permitted and <br>limited by KRS 161.470; (6) The board of trustees may annually, on July 1, adjust the current daily rate of a member's last annual compensation, for each full twelve (12) month period that has <br>elapsed subsequent to the member earning his or her last annual compensation, by <br>the percentage increase in the annual average of the consumer price index for all <br>urban consumers for the calendar year preceding the adjustment as published by the <br>Federal Bureau of Labor Statistics, not to exceed five percent (5%) annually. Each <br>annual adjustment shall become part of the member's daily rate base. Failure to <br>comply with the salary limitations set forth in subsections (1) and (2) of this section <br>as may be adjusted by this subsection shall result in a reduction of the member's <br>retirement allowance or any other benefit to which the member would otherwise be <br>entitled on a dollar-for-dollar basis for each dollar that the member exceeds these <br>salary limitations. Notwithstanding any other provision of law to the contrary, a <br>member retiring from a local school district who returns to work for a local school <br>district under subsection (1) or (2) of this section shall be entitled, without any <br>reduction to his or her retirement allowance or any other retirement benefit, to earn <br>a minimum amount equal to one hundred seventy dollars (&#36;170) per day; (7) (a) A retired member returning to work under subsection (1) or (2) of this section shall have separated from service for a period of at least one (1) year if <br>returning to work for the same employer on a full-time basis, and at least three <br>(3) months if returning to work for a different employer on a full-time basis. A <br>retired member returning to work under subsection (1) or (2) of this section on <br>a part-time basis shall have separated from service for a period of at least three <br>(3) months before returning to work for any employer. (b) As an alternative to the separation-from-service requirements in paragraph (a) of this subsection, a retired member who is returning to work for the same <br>employer in a full-time position under subsections (1) and (2) of this section <br>may elect a separation-from-service of not less than two (2) months followed <br>by a forfeiture of the retired member's retirement allowance on a month-to-<br>month basis for each month that the member has separated from service for <br>less than twelve (12) full months. A retired member returning to work for the <br>same employer in a part-time position, or for a different employer in a full-<br>time position, may elect an alternative separation-from-service requirement of <br>at least two (2) months followed by a forfeiture of the member's retirement <br>allowance for one (1) month. During the period that the member forfeits his or <br>her retirement allowance and thereafter, member and employer contributions <br>shall be made to the retirement system as a result of employment in any <br>position subject to membership in the retirement system. The member shall <br>contribute to an account with the retirement system subject to the conditions <br>set forth in subsection (5) of this section. For purposes of measuring the separation-from-service requirements set forth throughout this section, a <br>member's separation-from-service begins on the first day following the last <br>day of paid employment for the member prior to retirement. (c) Failure to comply with the separation-from-service requirements in this subsection voids a member's retirement and the member shall be required to <br>return all the retirement benefits he or she received, with interest, for the <br>period of time that the member returned to work without a sufficient <br>separation from service; (8) (a) Effective July 1, 2004, local school districts may employ retired members in full-time or part-time teaching or administrative positions without limitation <br>on the compensation of the retired members that is otherwise required by <br>subsections (1) and (2) of this section. Under provisions of this subsection, a <br>local school district may only employ retired members to fill critical shortage <br>positions for which there are no other qualified applicants as determined by <br>the local superintendent. The number of retired members that a local school <br>district may employ under this subsection shall be no more than two (2) <br>members per local school district or one percent (1%) of the total active <br>members employed by the local school district on a full-time basis as defined <br>under KRS 161.220(21), whichever number is greater. Retired members <br>returning to work under this subsection shall be subject to the separation-<br>from-service requirements set forth in subsection (7) of this section. Retired <br>members returning to work under this subsection shall waive their medical <br>insurance coverage with the retirement system during their period of <br>reemployment and receive medical insurance coverage that is offered to other <br>full-time members employed by the local school district. Retired members <br>returning to work under this subsection shall contribute to an account subject <br>to the conditions set forth in subsection (5) of this section. Retired members <br>returning to work under this subsection shall make contributions to the <br>retirement system at the rate provided under KRS 161.540. The employer <br>shall make contributions at the rate provided under KRS 161.550. Local <br>school districts shall make annual payments to the retirement system on the <br>compensation paid to the reemployed retirees at the rates determined by the <br>retirement system's actuary that reflect any accrued liability resulting from the <br>reemployment of these members. (b) The Department of Education may employ retired members in full-time or part-time teaching or nonteaching positions without the limitations on <br>compensation otherwise required by subsections (1) and (2) of this section to <br>fill critical shortage areas in the schools it operates, including the Kentucky <br>School for the Blind, the Kentucky School for the Deaf, and the Kentucky <br>Virtual High School, and to serve on audit teams. The department shall be <br>subject to the same requirements as local school districts as provided in <br>paragraph (a) of this subsection, except the Kentucky Teachers' Retirement <br>System shall determine the maximum number of employees that may be <br>employed under this paragraph; (9) The return to work limitations set forth in this section shall apply to retired members who are returning to work in the same position from which they retired, or <br>a position substantially similar to the one from which they retired, or a position <br>described in KRS 161.046 or any position listed in KRS 161.220(4) which requires <br>membership in the retirement system. Positions which generally require certification <br>or graduation from a four (4) year college or university as a condition of <br>employment which are created, or changed to remove the position from coverage <br>under KRS 161.220(4) are also subject to the return to work limitations set forth in <br>this section. The board of trustees shall determine whether employment in a <br>nonteaching position is subject to this subsection; (10) The provisions of subsections (1) to (8) of this section are not subject to KRS 161.714; (11) Any member retired by reason of service may waive his or her annuity and return to full-time employment in a position covered by the Kentucky Teachers' Retirement <br>System under the following conditions: <br>(a) The member shall receive no annuity payments while employed in a covered position, shall waive his or her medical insurance coverage with the Kentucky <br>Teachers' Retirement System during the period of reemployment, and shall <br>receive the medical insurance coverage that is generally offered by the <br>member's active employer to the other members of the retirement system <br>employed by the active employer. The member's estate or, if there is a <br>beneficiary applicably designated by the member, then the beneficiary, shall <br>continue to be eligible for life insurance benefits as provided in KRS 161.655. <br>Service subsequent to retirement shall not be used to improve an annuity, <br>except as provided in paragraphs (b) and (c) of this subsection; (b) Any member who waives regular annuity benefits and returns to teaching or covered employment shall be entitled to make contributions on the salaries <br>received for this service and have his retirement annuity recalculated as <br>provided in the regular retirement formula in KRS 161.620(1), less any <br>applicable actuarial discount applied to the original retirement allowance due <br>to the election of a joint and last survivor option. Retirement option and <br>beneficiary designation on original retirement shall not be altered by <br>postretirement employment, and dependents and spouses of the members shall <br>not become eligible for benefits under KRS 161.520, 161.525, or 161.661 <br>because of postretirement employment; (c) When a member returns to full-time teaching or covered employment as provided in subsection (b) of this section, the employer is required to withhold <br>and remit regular retirement contributions. The member must be employed <br>full-time for at least one (1) consecutive contract year to be eligible to <br>improve an annuity. The member shall be returned to the annuity rolls on July <br>1 following completion of the contract year or on the first day of the month <br>following the month of termination of service if full-time employment <br>exceeds one (1) consecutive contract year. Any discounts applied at the time <br>of the original retirement due to service or age may be reduced or eliminated due to additional employment if full-time employment is for one (1) <br>consecutive contract year or longer; and (d) A member retired by reason of service who has been employed the equivalent of twenty-five (25) days or more during a school year under KRS 161.605 <br>may waive the member's retirement annuity and return to regular employment <br>covered by the Kentucky Teachers' Retirement System during that school year <br>a maximum of one (1) time during any five (5) year period, beginning with <br>that school year; (12) Retired members may be employed in a part-time teaching capacity by an agency described in KRS 161.220(4)(b) or (n), not to exceed the equivalent of twelve (12) <br>teaching hours in any one (1) fiscal year. Retired members may be employed for a <br>period not to exceed the equivalent of one hundred (100) days in any one (1) fiscal <br>year in a part-time administrative or nonteaching capacity by an agency described in <br>KRS 161.220(4)(b) or (n) in a position that would otherwise be covered by the <br>retirement system. The return to work provisions set forth in subsections (1) to (8) <br>of this section shall not apply to retired members who return to work solely for an <br>agency described in KRS 161.220(4)(b) or (n). Calculation of the number of days <br>and teaching hours for part-time teaching, substitute teaching, or part-time <br>employment in a nonteaching capacity under this section shall not exceed the ratio <br>between a school year and the actual months of retirement for the member during <br>that school year. The board of trustees by administrative regulation may establish <br>fractional equivalents of a day of teaching service. Any member who exceeds the <br>twelve (12) hour or one hundred (100) day limitations of this subsection shall be <br>subject to having his or her retirement voided and be required to return all <br>retirement allowances and other benefits paid to the member or on the member's <br>behalf since the effective date of retirement. In lieu of voiding a member's <br>retirement, the system may reduce the member's retirement allowance or any other <br>benefit to which the member would otherwise be entitled on a dollar-for-dollar basis <br>for each dollar of compensation that the member earns in employment exceeding <br>twelve (12) hours, one hundred (100) days, or any apportionment of the two (2) <br>combined; (13) When a retired member returns to employment in a part-time teaching capacity or in a nonteaching capacity as provided in subsection (12) of this section, the employer <br>shall contribute annually to the retirement system on the compensation paid to the <br>retired member at rates determined by the retirement system actuary that reflect <br>accrued liability for retired members who return to work under subsection (12) of <br>this section; and (14) For retired members who return to work during any one (1) fiscal year in both a position described in KRS 161.220(4)(b) or (n) and in a position described under <br>another provision under KRS 161.220(4), and for retired members who return to <br>work in a position described under KRS 161.220(4)(b) or (n) in both a teaching and <br>an administrative or nonteaching capacity, the board of trustees shall adopt a <br>methodology for a pro rata apportionment of days and hours that the retired member <br>may work in each position. Effective: July 1, 2010 <br>History: Amended 2010 Ky. Acts ch. 164, sec. 9, effective July 1, 2010. -- Amended 2008 (1st Extra. Sess.) Ky. Acts ch. 1, sec. 38, effective June 27, 2008. -- Amended <br>2008 Ky. Acts ch. 78, sec. 14, effective July 1, 2008. -- Amended 2004 Ky. Acts <br>ch. 121, sec. 16, effective July 1, 2004. -- Amended 2002 Ky. Acts ch. 275, sec. 25, <br>effective July 1, 2002. -- Amended 2000 Ky. Acts ch. 477, sec. 2, effective July 14, <br>2000; and ch. 498, sec. 16, effective July 1, 2000. -- Amended 1998 Ky. Acts <br>ch. 515, sec. 11, effective July 1, 1998. -- Amended 1996 Ky. Acts ch. 359, sec. 14, <br>effective July 1, 1996. -- Amended 1992 Ky. Acts ch. 192, sec. 11, effective July 1, <br>1992. -- Amended 1990 Ky. Acts ch. 442, sec. 15, effective July 1, 1990; and <br>ch. 476, Pt. V, sec. 562, effective July 13, 1990. -- Amended 1980 Ky. Acts ch. 102, <br>sec. 1, effective July 15, 1980. -- Amended 1972 Ky. Acts ch. 82, sec. 19. -- <br>Amended 1964 Ky. Acts ch. 43, sec. 14. -- Amended 1958 Ky. Acts ch. 10, sec. 1. -- <br>Created 1952 Ky. Acts ch. 226, sec. 1. Legislative Research Commission Note (7/1/2004) In subsection (13) of this statute, two references to &quot;subsection (11) of this section&quot; have been changed to read <br>&quot;subsection (12) of this section.&quot; When the statute was amended in 2004 Ky. Acts <br>ch. 121, sec. 16, the subsections were renumbered, but the references to subsection <br>(11) were not changed to conform. The Reviser of Statutes has made the conforming <br>change under the authority of KRS 7.136. Legislative Research Commission Note (7/1/2004) 2004 Ky. Acts ch. 121, sec. 27, provides that &quot;The provisions of subsection (8) of Section 16 of this Act [KRS <br>161.605] supersede the provisions relating to critical shortage positions set forth in <br>2003 Ky. Acts ch. 156, sec. 1 [Executive Branch Budget Bill].&quot; Legislative Research Commission Note (7/13/90). The Act amending this section prevails over the repeal and reenactment in House Bill 940, Acts ch. 476, pursuant to <br>sec. 653(1) of Acts ch. 476.