DRS Email 09-001, New instructions for 2008 ERF and Retirees

  • Notice No.: 09-001
  • Date: January 6, 2009
  • Applies to: Employers
  • Subject: New instructions for 2008 Early Retirement Factors and Retirees

We would like to thank all of you for your feedback on implementation of the new post-retirement employment restrictions for individuals who retire under the 2008 early retirement factors. Based on your comments, we reviewed the original instructions and made some modifications.

For any contractor, independent contractor, or personal service contractor that you directly compensate, you will need to verify their retirement status. We have created a Contractor Status form for you to use with Member Reporting Verification (MRV) to review their status. If you see the following message displayed: “Retired under the 2008 early retirement factors. Stricter return to work rules apply,” contact Employer Support Services immediately for reporting instructions. If this message is not displayed, document and retain the form.

You are not required to verify the status of vendor companies, their employees and subcontractors. Vendor companies are hired through your normal bidding process.

Please remember this does not change the requirement to solicit retirement status from your employees. Continue to complete the Retirement Status form for employees and retain it for your records.

The following scenarios are provided to help clarify these instructions and assist you in determining what steps you should take in complying with the new requirements:

  1. You hire Sam Smith under a personal services contract to provide a one day training class to your employees. Sam Smith is paid directly for his services. Complete a Contractor Status form for Sam Smith
  2. You hire John Jones as an independent contractor to provide assistance in developing a new computer system for your office. John’s business is Jones Computer Services. John is directly compensated for his services. Complete a Contractor Status form. Note: Although John has a business license and name it does not exempt him from the return to work limitations if he retired using the 2008 ERF. John is directly compensated for his services and cannot use a business name to avoid the limitations.
  3. Through your bidding process, you hire ABC Landscaping to maintain your grounds. This company has 15 employees. You do not need to complete Contractor Status forms for this company or its employees.
  4. You hire XYZ Computers to replace all of your computer equipment. They are a large company with over 1500 employees. You do not need to complete Contractor Status forms for this company and employees.

As an alternative to completing the Department of Retirement System’s Contractor Status form and checking the MRV screen, you may create language elsewhere in your contracting process that asks contractors, independent contractors, and personal service contractors that you directly compensate to confirm in writing if they have retired from the State of Washington using the new 2008 ERF. If their response is “No”, maintain the documentation and you will have met your obligation. If their response is “Yes”, contact Employer Support Services for further instructions.

To assist your employees who are contemplating retirement, we are providing estimates with both the 2008 early retirement factors and the 3% reduction factors, if they qualify. We are also providing information on the return to work restrictions that would apply with each choice. If you receive questions from your employees on how to choose between these factors, working restrictions, or who is eligible to use the reduction factors, please refer them to a retirement services analyst at (360) 664-7000, option 4 or 1-800-547-6657, option 4.

For retirees who choose to use the 2008 factors, we will regularly remind them of the return to work restrictions attached to their retirement choice.

Questions?

If you have any questions regarding this DRS Notice, please contact Employer Support Services at (360) 664-7200, option 2, or 1-800-547-6657, option 6, option 2; or email us.


George Pickett
Assistant Director of Administrative Services

Communications