TRS Plan 1: Thinking About Working After Retirement?

For members of the Teachers' Retirement System (TRS) Plan 1

Last Updated: July 2016

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This publication describes what could happen to your Teachers’ Retirement System Plan 1 benefit if you return to work for an employer covered by one of the state retirement systems. You can return to work for an employer not covered by a Washington state retirement system without impacting your monthly benefit unless you are a disability retiree.

When do I become a retiree?

You must fully retire before you can be covered under return-to-work laws. To do so, you must:

  • Meet the age and service requirements for retirement
  • File an application for retirement with the Department of Retirement Systems (DRS)
  • End all employment with any DRS-covered employer(s)
  • Sever all contractual agreements (written or verbal) for future employment with your DRS-covered employer(s)

Taking these actions will establish your effective retirement date as the first day of the month following the month in which you became eligible for retirement.

Example 1
Maria applies for retirement and terminates her employment Aug. 15, 2015. She meets the age and service requirements. Her effective retirement date is Sept. 1, 2015.

Example 2
Quinn applied for retirement and terminated his employment July 15, 2014. He had enough service credit to meet the requirements for retirement. However, he did not meet the age requirement until July 15, 2015. His effective retirement date, therefore, was Aug. 1, 2015.

What should I do before I return to work?

Before you return to work for a DRS-covered employer, tell the employer you are a retiree. If the employer doesn’t know you are retired, you could be reported as an active member, which might stop your benefit. Ask the employer about your eligibility for membership in a DRS or higher education retirement plan. If you have questions, contact DRS.

How soon can I return to work?

First, leave all DRS-covered employment, regardless of whether your employment is being reported to DRS. Then you must wait at least 30 consecutive days after your effective retirement date before returning to work.

If you return to work for a DRS-covered employer in any capacity before 30 days have passed, your benefit will be reduced by 5.5% for every seven hours you work in a month — up to 140 hours.

If the reduction is more than your monthly benefit, the excess will be taken from the next month’s payment. The reduction will continue until you stop working for a full 30 days. This rule also applies to substituting.

What if I return to work before my effective retirement date?

If you terminate employment and file a retirement application but return to work before your effective retirement date, your application for retirement will be canceled.

Because you will not be considered retired, you will return to active membership if you return to an eligible position, and you will be required to pay member contributions..

How many hours can I work each year and still receive my benefit?

You must be separated from employment for at least 30 days after your effective retirement date before you can return to work for an educational employer and continue to receive an unreduced benefit.

Before you retire from your current place of employment, you must not have a written or verbal agreement to return to work.

Once you have been retired for at least 30 consecutive calendar days, additional rules apply based on the date you retired and where you plan to return to work.

The following rules apply when you return to work as a full-time employee or substitute for a public educational institution in Washington state — such as with a K-12 employer, community college or university — or in a position eligible for a higher education retirement plan (HERP):

  • You can work up to 867 hours in a fiscal year (July 1 – June 30) without impacting your retirement benefit.
  • Your TRS Plan 1 retirement benefit will be suspended once you work more than 867 hours within a fiscal year. Your benefit will resume the first of the month following your last day of employment or the start of the next fiscal year when the number of hours you may work resets to 867, whichever comes first.
  • HERPs are non-DRS retirement plans offered by institutions of higher education, such as the University of Washington Retirement Plan and Western Washington University Retirement Plan. If you work for a higher education employer, check with your employer to find out whether your position is HERP-eligible.

If you return to work for a state agency or political subdivision, such as for a city, county or other public employer, you have no retire/rehire limitations. Hours you work for a state agency or political subdivision will not impact your TRS Plan 1 monthly retirement benefit.

What if I retired as a dual member?

A dual member retiree is someone who has combined service credit earned in more than one retirement system to qualify for retirement. If you retired as a dual member, contact DRS to find out the impacts returning to work will have on your monthly benefit.

What happens if I work more than the annual limit?

If you are employed in an eligible position and work more than the allowed 867 hours within a fiscal year, your monthly benefit will be suspended for the remainder of the fiscal year or until you terminate your employment. In the month you exceed the limit, your benefit will be prorated.

Min retires effective July 1, 2015, and returns to work for a school district Sept. 1, 2015. She works as a substitute teacher. On May 14, 2016, she exceeds the 867-hour limit. She receives a partial monthly benefit for May but will not receive a benefit in June. Min’s benefit restarts July 1, 2016.

DRS will notify you in writing when you near your hourly limit. Once you exceed your limit, DRS will tell your employer. You can also track your hours by logging into (or signing up for) online account access.

What if I am receiving a disability retirement?

If you are a disability retiree, returning to any kind of employment could affect your monthly benefit.

Your return to work could mean you are no longer disabled and, therefore, no longer eligible to receive a disability retirement.

If you retired because of a disability and are considering returning to work, contact DRS.

Can I return to active membership?

You aren’t required to return to TRS membership, but you can choose to if you are a TRS Plan 1 retiree; are employed in a full-time, TRS-covered position; and at least 90 days have passed since you retired. Your return to active TRS membership could impact your future retirement benefit. Contact DRS for a benefit estimate before returning to membership.

If you retired with fewer than 15 years of service credit, you can become a contributing member of the Public Employees’, School Employees’, or Law Enforcement Officers’ and Fire Fighters’ retirement systems. However, your TRS benefit might be suspended pending termination of your employment.

Which hours count toward the annual limit?

All hours for which you receive compensation count toward the annual limit. This includes paid holidays or compensatory time, sick leave, and annual leave taken in place of normal work hours.

Sick leave or annual leave that is cashed out at the end of an employment period doesn’t count toward the limit. Cashed out compensatory time does count toward the limit.

General information

Overpayments and underpayments: If you receive an overpayment of your monthly benefit, you will be required to repay it to DRS. If you receive an underpayment, DRS will correct the error and pay you the amount owed. Your employer reports your hours to DRS. But you are responsible for ensuring the correct information is reported.

Health care: If you have retired from state government, a public education institution or a local government employer participating in the Public Employees Benefits Board (PEBB), you have the option to return to PEBB-sponsored coverage when you return to full retirement status.

If you have questions about your health care coverage, contact the Health Care Authority. If you have retired from employment with local government, you will need to coordinate with your employer and health care provider to determine your health care options.

Deferred Compensation Program (DCP): If you are receiving payment from DCP, returning to work won’t affect your payments. If you are not yet receiving payments and return to work, you can continue making contributions to the plan up to an annual maximum contribution amount, depending on your income. If you have questions, contact DCP.

Contract work with a Washington state educational institution: As a TRS retiree, your employment status and rights differ from those of an active, tenured teacher. The duration of a return-to-work contract is limited to one year. However, a contract can be renewed each year at the discretion of your employer. For more information, contact the Office of the Superintendent of Public Instruction (OSPI).

For answers to your re-employment questions, contact DRS.