DRS Email 19-008, Non-LEOFF Employer Contributions (NLEC) and Hiring Bonuses/Incentives for LEOFF

  • Notice No.: 19-008
  • Date: June 20, 2019
  • Applies to: LEOFF Employers
  • Subject: DRS Email 19-008, Non-LEOFF Employer Contributions (NLEC) and Hiring Bonuses/Incentives for LEOFF

Employer pickup of state contributions on LEOFF Plan 2 non-employer services

The 2019-2021 state operating budget has extended a provision for LEOFF Plan 2 employers. The provision holds employers responsible for funding both the employer and state contributions owed on LEOFF Plan 2 basic salary earned for services rendered by members whose services were provided directly, or indirectly, to a non-LEOFF employer.

Please continue to report Non-LEOFF Employer Contributions (NLEC) through My Services/NLEC in eServices or under the NLEC process in the Employer Reporting Application.

For more information on reporting and paying NLEC, please review Chapter 5: Special Conditions in the DRS Employer Handbook.

Hiring bonus or incentive reporting

DRS is aware that many LEOFF employers are offering hiring incentives to help recruit and retain experienced employees for LEOFF positions.

We want to remind employers that a hiring bonus, signing bonus or incentive for accepting employment that is paid to an employee is not reportable to DRS as LEOFF compensation. The new hire is paid for the act of accepting the job, rather than for services rendered to the employer. The payment does not meet the definition of basic salary for any DRS covered plan and is compensation that is not reportable to DRS.

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

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