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House moves to curb retirement sick‑leave liability, adds 401(k) match
Summary
HB 194 freezes future retirement value for sick leave earned after Jan. 1, 2014, preserves accrued values for earlier service and creates a $26-per-pay-period 401(k) match; sponsors cited a roughly $70 million unfunded liability.
On Feb. 25 the Utah House passed House Bill 194, a measure addressing state employee sick‑leave retirement benefits and a growing unfunded liability.
Representative Dunnegan explained that two previous programs treated accrued sick leave differently depending on the date it was earned; HB 194 preserves the existing retirement value for sick leave earned before Jan. 1, 2014, but eliminates retirement cash‑out value for sick leave accrued after that date. To offset the change and provide a replacement benefit, the bill establishes a state match up to $26 per pay period into qualifying employees’ 401(k) plans, provided employees contribute the same amount. Dunnegan told the House the state faces about a $70 million unfunded liability in the current sick‑leave program growing at about $10 million per year and said the change will stop that trend.
Floor members asked whether employee groups supported the change; Dunnegan said the Utah Public Employees Association had been involved in talks and was supportive. The bill passed 71–1 and will be sent to the Senate.
