One of the biggest benefits of working in public education in Missouri is the stellar retirement benefits that you accrue working for public schools. For school districts outside of the Kansas City and St. Louis City districts, both certificated staff, under the Public School Retirement System, and all other education employees, under the Public Education Employee Retirement System, are able to accrue credit toward retirement as they work. One of many surprises COVID-19 pandemic delivered is a need for leave options greater than ever before. Many of these leave options may have influence on PSRS/PEERS benefits. Therefore, I will set out to analyze just how PSRS/PEERS benefits work in Missouri and ways to ensure that you do not lose any benefits, even if you need to take time off. If you have specific questions about your own retirement account, you can research PSRS/PEERS either by searching www.psrs-peers.org or by calling a representative at (800) 392-6848.
Accruing retirement benefits
Nearly all aspects of PSRS/PEERS revolve around the “years of service” that an individual has accrued. The rights to benefits begins after five years of service (also known as “vesting”). Eligibility for retirement is based on years of service, and the total retirement benefit is based on a calculation of highest average salary multiplied by years of service. Understanding what qualifies as a “year of service” is a crucial first step to understanding your retirement benefits and the ways COVID-19 might influence them.
There is a common misconception that qualifying for a year of service is based on the number of days worked in a school year, but that actually is not how PSRS/PEERS makes the determination. Instead, a year of service is defined as an individual working a “complete term” of his or her position and receiving at least 95 percent of the annual base salary. The “complete term” requirement essentially is just that you remain employed from the beginning to the end of either your employment contract or your regularly scheduled school year (whether that is a 9-, 10-, 11-, or 12-month year will depend on the position held). If you complete a full term of employment, then PSRS only considers how much of your annual salary you earned. If you have earned at least 95 percent of your regular annual salary, then you receive one full year of service. Note that there isn’t any focus on how many days were actually worked in that term, just whether the person remained employed the full year and if he or she earned 95 percent of his or her salary.
It is possible to accrue credit toward retirement in sums less than a complete year as well. Individuals who start in a position part way through the school year or who either leave before the completion of a full year or earn less than 95 percent of their annual salary can still earn fractions of a year toward retirement. Someone who starts Jan. 1 and completes the rest of the school year, thereby earning 50 percent of the annual salary for that position, can earn half of a year of service credit.
COVID-19 leave
Leave from work is often necessary for individuals dealing with COVID-19 issues, either their own or the issues of family members.
Some districts, particularly those where an MNEA local affiliate bargains a collective bargaining agreement, have other types of extended leave that may be available to employees. The two types of leave that are most familiar to people, under either the Family Medical Leave Act or the American’s with Disabilities Act, are unpaid leaves that individuals may use without being disciplined or retaliated against. If an employee has accrued sick leave, then he or she can choose to use that leave to receive compensation for some or all of the leave, depending on the number of days he or she has accrued.
In addition to these, the Family First Coronavirus Response Act created two new types of leave, Expanded FMLA and Emergency Paid Sick Leave. These types of leave are also protected from discrimination or retaliation, but they have the added benefit of also being paid. Although there are some types of EPSLA that are paid at a regular daily rate, most EFMLA or EPSLA leaves are paid at a lesser rate of 2/3 of an individual’s daily rate, up to a maximum of $200.
Where these types of leave begin to interact with PSRS/PEERS is when an individual using one of these extended types of leave makes less then 95 percent of his or her annual income. Either because an individual has taken a type of unpaid leave and hasn’t had enough accrued leave to offset it or because that person has taken a form of paid leave that doesn’t pay the full amount, there will be many individuals who do not meet that 95 percent level. These individuals will not be able to receive a full year of service and, instead, will receive some fraction of a year of credit.
by Vincenzo Iuppa, Associate general counsel
Something Better, winter 2020