Compensation and Contributions

Compensation and Contributions

Employee and employer contributions are required to be made to SERS based upon the employee’s SERS compensation. The employee contribution rate is currently 10%. The employer contribution rate is 14%.

“Compensation” includes all salary, wages, and other earnings paid to an employee by reason of employment. Compensation is determined prior to the amount deducted as the employee’s contributions and before any of the compensation is treated as deferred income for federal income tax purposes.

It is important to remit contributions promptly and accurately. Employee or survivor benefits are dependent on accurate compensation information reported to SERS.

Contributions are to be remitted to SERS no later than five business days after each pay date in eSERS.

Compensation subject to SERS contributions includes, but is not limited to:

• Regular base salary
• Regular/base hourly wages
• Overtime paid to non-exempt employees
• Pick-up on Pick-up Plan
• Pay for used vacation and sick leave
• Paid holiday
• Calamity days
• Across-the-board retroactive wage settlements
• Longevity/length of service, which is a payment based on total years of employment per written contract or policy and applicable to all employees
• Merit increases
• Employee payments to an eligible retirement plan (e.g. 403(b), 457(b), 401(k))
• Backpay award that reinstates an employee to the employee’s position without interruption of loss of time
  • To avoid any interest accrued, the payment will need to be submitted within the same fiscal year it was earned/paid.
• Extended days
• Commissions per contract terms
• Payments made by the employer to the employee for Workers’ Compensation Salary Continuation
• Lump sum payments
  • Must be provided for in the collective bargaining agreement, individual contract, or school district policy
• Retention payments
  • Must be written in the contract
• Education payments
  • Must be written into a contract or school district policy
• Signing bonus
  • Must be written into a contract or school district policy

Compensation not subject to SERS contributions, includes, but is not limited to:

• Unused compensatory time (comp time) cash out
• Unused leave time (vacation/sick/personal) cash out
• Attendance, which are payments for limited use of sick leave per a policy or contract
• Wellness rewards, which are payments to employees for achieving measurable health goals as set forth in a written policy
• Recruitment, which is a payment for referring a job applicant who is hired
• Severance payment
• Bonus payment, which is a discretionary payment not governed in a contract
• Amounts paid to an employee for life insurance, sickness, accident, endowment, health, medical, hospital, dental, or surgical coverage or in lieu of providing insurance
• Incidental benefits including lodging, food, laundry, clothing/uniform allowance, and parking
• Services furnished by the employer, including use of the employer’s property or equipment, and cell phones
• Reimbursement for job-related expenses authorized by the employer, including moving and travel expenses related to professional development
• Compensation made on behalf of an employee exceeding the allowable limit under federal tax law
• Anything of value paid to an employee based on or attributed to retirement or an agreement to retire.
• Payments made as a differential payment for an employee who enters active military duty for mor than a month