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 salary or wages
  • Overtime earnings
  • Pay for used vacation and sick leave
  • Paid holidays
  • Calamity days
  • Across-the-board retroactive wage settlements
  • Longevity pay
  • Merit increases
  • As of the 2014-15 school year, a lump-sum payment in lieu of a salary or wage increase to all persons in a class of employees, in the same dollar amount or percentage, and in accordance with a written contract
  • Payments paid on behalf of the individual and treated as deferred income for federal income tax purposed under Internal Revenue Code (IRC) Section 401(k), 403(b), or 457(b)
  • Back pay awards that reinstate an employee to the employee’s position without interruption or loss of time
  • Payments made by the employer to the employee for Workers’ Compensation Salary Continuation

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

  • Payments for accrued but unused sick leave, personal leave, vacation leave, or compensatory time
  • Amounts paid to provide life insurance, sickness, accident, endowment, health, medical, hospital, dental, surgical coverage, other insurance for the employee, or amounts paid to the employee in lieu of providing the insurance
  • Incidental benefits, including lodging; food; laundry, including clothing/uniform allowance; parking; services furnished by the employer; use of the employer’s property or equipment, including cell phones; and reimbursement for job-related expenses authorized by the employer, including moving and travel expenses; and expenses related to professional development
  • Compensation made to, or on behalf of, an employee that is in excess of the allowable amount under federal tax law
  • Anything of value paid to an employee that is based on or attributable to retirement or an agreement to retire
  • Payments made as a differential payment for an employee who enters active military duty for more than a month
  • One-time and/or lump-sum payments made to an employee where such payments are not made for additional services actually rendered, or not based on an employee’s standard rate of pay, such as:
    • Severance
    • Incentive bonuses for low use of leave
    • Signing bonuses
    • Wellness Incentive
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