Q1) Is there a difference in retiree work hour limits for Tier One/Tier Two and OPSRP retirees?
A1) Yes. Statute allows Tier One/Tier Two retirees to work less than 1040 hours in a calendar year as a retiree without affecting their ability to receive their retirement benefit. OPSRP retirees, on the other hand, do not have special statutory retiree work allowances, and statute provides that they must stop receiving retirement benefits if they return to work in a “qualifying position,” which is defined by statute as “one or more jobs with one or more participating public employers in which an eligible employee performs 600 or more hours of service in a calendar year.”
PERS had administered the 600 hour limit consistently with Tier One/Tier Two’s 1040 hour limit, counting hours worked post-retirement separately from hours worked pre-retirement in the same calendar year when an OPSRP retired member returned to work. This practice was recently questioned during a review of ORS 238A.245, and in February 2015, PERS informed employers that a strict interpretation of the 600 hours standard may look at the calendar as a whole in determining whether the retiree is in a “qualifying position,” combining hours worked pre-retirement and post-retirement in the same calendar year. PERS was asked to review alternative interpretations and solutions to avoid such a result. The agency initiated rulemaking to amend the corresponding Oregon Administrative Rule (OAR 459-075-0300) to provide authority for “resetting” the 600 hour count for a retired member, focusing on the reemployment “as a retired member” language to support historic practices. The rule was adopted by the PERS board at the July 31, 2015 board meeting. Having this interpretation in rule will provide more explicit authority for this practice.
Consequently, under PERS administration, OPSRP retirees may work up to 599.99 hours combined service in jobs with “non-qualifying” employer hire intent, as a “retired member” in any calendar year and still be considered retirees, but the work limit is exceeded when 600 hours service is performed.
Q2) Why is the OPSRP retiree combined service limit set at less than 600 hours in a calendar year?
A2) The 600 hour rule is not a retiree work limit; it is a PERS program membership requirement. 600 hours is the minimum service in any calendar year which makes all job segments in that calendar year “qualifying” for that year, and work in a “qualifying” position is one of three requirements to establish active program membership. Meeting or exceeding this limit would re-establish active membership and automatically cancel an OPSRP retirement.
Q3) What is included in the OPSRP retiree combined service less than 600 hours limitation?
A3) The less than 600 hour annual service limit includes total service hours in “non-qualifying” jobs in any calendar year.
Q4) What does this mean for OPSRP retiree service in the calendar year of retirement?
A4) As clarified in the recent rule amendment to OAR 459-075-0300, an OPSRP retiree may return to a “non-qualifying” position(s) in the year of retirement but must limit total retiree service in all positions to less than 600 hours. Active service in the year of retirement will not contribute to the 600 hour/calendar year work limit for OPSRP retirees in post-retirement “non-qualifying” positions. An OPSRP retiree cannot return to work in a position with “qualifying” hire intent and continue in OPSRP retired status.