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Committee clarifies retirement "spike" responsibility for employees employed before 2015
Summary
Staff told the policy committee that if an employee became a member of the teachers' retirement system before Jan. 1, 2015, the district may be responsible for restoring retirement allowances for a compensation "spike." The committee voted to forward clarified policy language to the full board.
The New Hanover County Schools policy committee approved forwarding a clarification to Policy 79-10 that explains when the district may be responsible for retirement "spike" costs.
Dr. Barnes said state law treats employees who became members of the Teachers and State Employees Retirement System prior to 01/01/2015 differently: if such an employee experiences a sharp rise in compensation in years used to calculate retirement, the final employer may be responsible to adjust retirement allowances. "If you were employed prior to 2015... the employer would be responsible," staff said.
Staff emphasized the event is rare: only about eight employees are typically subject to the individual assessment, and one or two might actually generate a spike that triggers district liability. Committee members asked clarifying questions about how the retirement benefit is calculated; staff explained it is based on a coefficient using the employee's four highest consecutive years of employment. The committee voted to forward the clarified language to the full board (motion carried, recorded as 3–0).
