Tag Archives: PEF

Retroactive Payments and Your NYSLRS Pension Benefit

Retroactive payments are lump sum payments you receive from your employer. These can be from newly negotiated union contracts, like the one ratified on December 14 by Public Employees Federation (PEF) union members. Retroactive payments can also be from arbitration awards or legal settlements.

Your final average salary (FAS) is a major factor in your pension benefit calculation. Your FAS is the average of your three (five for Tier 6 members) highest consecutive years of earnings. How do retroactive payments affect your final average salary?

How Retroactive Payments Can Affect Your Benefit

When we calculate your FAS at retirement, retroactive payments are applied to the pay periods when they were earned, not when they were paid. In general, retroactive payments can increase your FAS as long as the time period in which you earned that money is part of your FAS.

For example, state employees who are members of PEF received a retroactive payment this month for salary earned since April 1, 2016. If you are one of these PEF members, we would apply the lump sum payment over the time frame when it was earned (State fiscal year April 1, 2016 through March 31, 2017). If that State fiscal year falls within your highest three (five for Tier 6) consecutive years of earnings, the retroactive payment you received in March should increase your FAS.

Your employer should let us know if you receive a retroactive payment before or after you retire. If you are a State employee who received a PEF retroactive payment after you retired, we will recalculate your pension benefit amount automatically; you do not need to notify us. If you receive a retroactive payment from a non-state employer after your pension benefit calculation is finalized, send a letter to our Recalculation Unit in the Benefit Calculations & Disbursement Services Bureau. Please include a copy of your check stub and/or any correspondence you received from your employer. You may also email and upload this information to the Retirement System through our secure contact form.

For more information about FAS, read our Understanding Your Final Average Salary blog post. You can also find out specific information about your FAS by reading your retirement plan booklet, available on our Publications page.

NYSLRS Retirees Help Power New York’s Economy

At the 2015 annual meeting of the Retired Public Employees Association of New York, State Comptroller Thomas P. DiNapoli told association members that “a public pension is not only good for you and your family, it’s good for New York State.” He added that “you are part of the economic engine in many of our communities.”

The administrator of the New York State & Local Retirement System (NYSLRS) and trustee of the New York State Common Retirement Fund, State Comptroller DiNapoli also noted that, of NYSLRS’ 430,308 retirees, 78 percent of them — 337,406 — have chosen to live in New York.

NYSLRS-Retirees-Build-a-Stronger-NY

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This is important, the State Comptroller explained, because the pension money paid to retired state and local public employees’ flows directly back into our communities, stimulating and growing our local economies.

During calendar year 2014, NYSLRS retirees were responsible for $12 billion in economic activity in New York State.