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What Unused Sick Leave Might Mean For You at Retirement

If you’ve accumulated unused, unpaid sick leave, you may be able to use it toward your NYSLRS pension benefit.

New York State employees are eligible for this benefit. You also may be eligible if your employer has adopted Section 41(j) for the Employees’ Retirement System (ERS), or 341(j) for the Police and Fire Retirement System (PFRS), of Retirement and Social Security Law. Not sure? Ask your employer or check your Member Annual Statement.

Here’s How It Works

Your additional service credit is determined by dividing your total unused, unpaid sick leave days by 260. Most ERS members can get credit for up to 165 days (7½ months) of unused sick leave. The benefit is capped at 100 days (4½ months) for most Tier 6 members. State employees in certain negotiating units may be able to use 200 days (about nine months). Those extra “months” would be used in calculating your retirement benefit.

Also, depending on your employer, your unused sick leave may be used to cover some health insurance costs during your retirement. Please check with your employer for information about health insurance.

Restrictions

Unused sick leave cannot be used to reach NYSLRS retirement milestones. Let’s say you have 19½ years of service credit. At 20 years, your pension calculation would improve substantially. You also have 130 days of unused sick leave. Can you add the six months of sick leave credit to get you to 20 years? No. Retirement law does not permit it. You’ll have to work those extra six months to get the 20-year benefit rate, though sick leave credits can still be used in your final pension calculation.

Also, credit for unused sick can’t be used to:

  • Qualify for vesting
  • Reach a minimum retirement age
  • Increase your pension beyond the maximum allowed under your retirement plan
  • Meet the service credit requirement for a special 20- or 25-year plan

Check your retirement plan booklet for more information.

What Unused Sick Leave at Retirement Might Mean For You

Members of the New York State and Local Retirement System (NYSLRS) may receive additional service credit for their unused, unpaid sick leave at retirement. If you’re a New York State employee, or if your employer has adopted Section 41(j) for the Employees’ Retirement System (ERS) or 341(j) for the Police and Fire Retirement System (PFRS) of the Retirement and Social Security Law, you may be eligible for this credit.

How It Works*

Your unused, unpaid sick leave may add up to 165 days (7½ months) to your service credit. The credit is calculated on a 260 annual workday basis—165 days divided by 260 days equals 7½ months—so you may receive an added credit of .63 of a year.

The additional credit for most ERS members can’t exceed 165 days. Most Tier 6 ERS members can receive up to 100 days (.38 of a year) of additional credit. For State employees in certain negotiating units, up to 200 days of unused, unpaid sick leave (.77 of a year) may be credited.

Also, depending on your employer, your unused sick leave may be used to cover some of the costs of your health insurance premiums during your retirement. (Please check with your employer for more information.)

*This section was revised on 12/5/14.

Calculation Example

If you have 130 unused, unpaid sick leave days when you retire, we would divide 130 by 260 and you would get .50 of a year, or 6 months, additional service credit.

Restrictions

While you may receive additional service credit for your sick leave under Sections 41(j) or 341(j), there are some restrictions. Credit for unused sick leave at retirement can’t be used to:

  • Qualify for vesting. For example, if you have nine years and ten months of service credit and you need ten years to be vested, your sick leave credit cannot be used to reach the ten years.
  • Qualify for a better retirement benefit calculation. For example, if you have 19¾ years of service credit, but your pension will improve substantially if you have 20 years, your sick leave credit cannot be used to reach the 20 years.
  • Increase your pension beyond the maximum amount payable under your retirement plan.
  • Meet the service credit requirement to retire under a special 20- or 25-year plan.

Check your retirement plan booklet for more information about this benefit. You can also check page 4 of your Member Annual Statement to see if this optional benefit is available to you.