97TH GENERAL ASSEMBLY
State of Illinois
2011 and 2012
SB2497

 

Introduced 10/12/2011, by Sen. Ron Sandack

 

SYNOPSIS AS INTRODUCED:
 
40 ILCS 5/8-226  from Ch. 108 1/2, par. 8-226
40 ILCS 5/11-215  from Ch. 108 1/2, par. 11-215
40 ILCS 5/17-134  from Ch. 108 1/2, par. 17-134
40 ILCS 5/17-134.1

    Amends the Chicago Municipal, Chicago Laborers, and Chicago Teachers Articles of the Illinois Pension Code to provide that, for certain leaves of absence during which a participant is employed by a labor organization, contributions shall be based upon the participant's regular salary (rather than the salary received from the organization). Effective immediately.


LRB097 13629 AMC 58165 b

FISCAL NOTE ACT MAY APPLY
PENSION IMPACT NOTE ACT MAY APPLY

 

 

A BILL FOR

 

SB2497LRB097 13629 AMC 58165 b

1    AN ACT concerning public employee benefits.
 
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
 
4    Section 5. The Illinois Pension Code is amended by changing
5Sections 8-226, 11-215, 17-134, and 17-134.1 as follows:
 
6    (40 ILCS 5/8-226)  (from Ch. 108 1/2, par. 8-226)
7    Sec. 8-226. Computation of service. In computing the term
8of service of an employee prior to the effective date, the
9entire period beginning on the date he was first appointed and
10ending on the day before the effective date, except any
11intervening period during which he was separated by withdrawal
12from service, shall be counted for all purposes of this
13Article, except that for any employee who was not in service on
14the day before the effective date, service rendered prior to
15such date shall not be considered for the purposes of Section
168-138.
17    For a person employed by an employer for whom this Article
18was in effect prior to January 1, 1950, from whose salary
19deductions are first made under this Article after December 31,
201949, any period of service rendered prior to the effective
21date, unless he was in service on the day before the effective
22date, shall not be counted as service.
23    The time a person was an employee of any territory annexed

 

 

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1to the city prior to the effective date shall be counted as a
2period of service.
3    In computing the term of service of any employee subsequent
4to the day before the effective date, the following periods
5shall be counted as periods of service for age and service,
6widow's and child's annuity purposes:
7        (a) The time during which he performed the duties of
8    his position;
9        (b) Vacations, leaves of absence with whole or part
10    pay, and leaves of absence without pay not longer than 90
11    days;
12        (c) Leaves of absence without pay during which a
13    participant is employed full-time by a local labor
14    organization that represents municipal employees, provided
15    that (1) the participant continues to make employee
16    contributions to the Fund as though he were an active
17    employee, based on the regular salary rate received by the
18    participant for his municipal employment immediately prior
19    to such leave of absence (and in the case of such
20    employment prior to December 9, 1987, pays to the Fund an
21    amount equal to the employee contributions for such
22    employment plus regular interest thereon as calculated by
23    the board), and based on his current salary with such labor
24    organization after the effective date of this amendatory
25    Act of 1991 and until the effective date of this amendatory
26    Act of the 97th General Assembly, and, after the effective

 

 

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1    date of this amendatory Act of the 97th General Assembly,
2    based on the regular salary rate received by the
3    participant for his municipal employment immediately prior
4    to such leave of absence, (2) after January 1, 1989 the
5    participant, or the labor organization on the
6    participant's behalf, makes contributions to the Fund as
7    though it were the employer, in the same amount and same
8    manner as specified under this Article, based on the
9    regular salary rate received by the participant for his
10    municipal employment immediately prior to such leave of
11    absence, and based on his current salary with such labor
12    organization after the effective date of this amendatory
13    Act of 1991 and until the effective date of this amendatory
14    Act of the 97th General Assembly, and, after the effective
15    date of this amendatory Act of the 97th General Assembly,
16    based on the regular salary rate received by the
17    participant for his municipal employment immediately prior
18    to such leave of absence, and (3) the participant does not
19    receive credit in any pension plan established by the local
20    labor organization based on his employment by the
21    organization;
22        (d) Any period of disability for which he received (i)
23    a disability benefit under this Article, or (ii) a
24    temporary total disability benefit under the Workers'
25    Compensation Act if the disability results from a condition
26    commonly termed heart attack or stroke or any other

 

 

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1    condition falling within the broad field of coronary
2    involvement or heart disease, or (iii) whole or part pay;
3        (e) Any period for which contributions and service
4    credit have been transferred to this Fund under subsection
5    (d) of Section 9-121.1 or subsection (d) of Section
6    12-127.1 of this Code.
7    For a person employed by an employer in which the 1921 Act
8was in effect prior to January 1, 1950, from whose salary
9deductions are first made under the 1921 Act or this Article
10after December 31, 1949, any period of service rendered
11subsequent to the effective date and prior to the date he
12became an employee and contributor, shall not be counted as a
13period of service under this Article, except such period for
14which he made payment as provided in Section 8-230 of this
15Article, in which case such period shall be counted as a period
16of service for all annuity purposes hereunder.
17    In computing the term of service of an employee subsequent
18to the day before the effective date for ordinary disability
19benefit purposes, all periods described in the preceding
20paragraph, except any such period for which he receives
21ordinary disability benefit, shall be counted as periods of
22service; provided, that for any person employed by an employer
23in which this Article was in effect prior to January 1, 1950,
24from whose salary deductions are first made under this Article
25after December 31, 1949, any period of service rendered
26subsequent to the effective date and prior to the date he

 

 

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1became an employee and contributor, shall not be counted as a
2period of service for ordinary disability benefit purposes,
3unless the person made payment for the period as provided in
4Section 8-230 of this Article, in which case the period shall
5be counted as a period of service for ordinary disability
6purposes for periods of disability on or after the effective
7date of this amendatory Act of 1997.
8    Overtime or extra service shall not be included in
9computing any term of service. Not more than 1 year of service
10shall be allowed for service rendered during any calendar year.
11(Source: P.A. 90-511, eff. 8-22-97.)
 
12    (40 ILCS 5/11-215)  (from Ch. 108 1/2, par. 11-215)
13    Sec. 11-215. Computation of service.
14    (a) In computing the term of service of an employee prior
15to the effective date, the entire period beginning on the date
16he was first appointed and ending on the day before the
17effective date, except any intervening period during which he
18was separated by withdrawal from service, shall be counted for
19all purposes of this Article. Only the first year of each
20period of lay-off or leave of absence without pay, continuing
21or extending for a period in excess of one year, shall be
22counted as such service.
23    (b) For a person employed by an employer for whom this
24Article was in effect prior to August 1, 1949, from whose
25salary deductions are first made under this Article after July

 

 

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131, 1949, any period of service rendered prior to the effective
2date, unless he was in service on the day before the effective
3date, shall not be counted as service.
4    (c) In computing the term of service of an employee
5subsequent to the day before the effective date, the following
6periods of time shall be counted as periods of service for
7annuity purposes:
8        (1) the time during which he performed the duties of
9    his position;
10        (2) leaves of absence with whole or part pay, and
11    leaves of absence without pay not longer than 90 days;
12        (3) leaves of absence without pay during which a
13    participant is employed full-time by a local labor
14    organization that represents municipal employees, provided
15    that (A) the participant continues to make employee
16    contributions to the Fund as though he were an active
17    employee, based on the regular salary rate received by the
18    participant for his municipal employment immediately prior
19    to such leave of absence (and in the case of such
20    employment prior to December 9, 1987, pays to the Fund an
21    amount equal to the employee contributions for such
22    employment plus regular interest thereon as calculated by
23    the board), and based on his current salary with such labor
24    organization after the effective date of this amendatory
25    Act of 1991 and until the effective date of this amendatory
26    Act of the 97th General Assembly, and, after the effective

 

 

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1    date of this amendatory Act of the 97th General Assembly,
2    based on the regular salary rate received by the
3    participant for his municipal employment immediately prior
4    to such leave of absence, (B) after January 1, 1989 the
5    participant, or the labor organization on the
6    participant's behalf, makes contributions to the Fund as
7    though it were the employer, in the same amount and same
8    manner as specified under this Article, based on the
9    regular salary rate received by the participant for his
10    municipal employment immediately prior to such leave of
11    absence, and based on his current salary with such labor
12    organization after the effective date of this amendatory
13    Act of 1991 and until the effective date of this amendatory
14    Act of the 97th General Assembly, and, after the effective
15    date of this amendatory Act of the 97th General Assembly,
16    based on the regular salary rate received by the
17    participant for his municipal employment immediately prior
18    to such leave of absence, and (C) the participant does not
19    receive credit in any pension plan established by the local
20    labor organization based on his employment by the
21    organization;
22        (4) any period of disability for which he received (i)
23    a disability benefit under this Article, or (ii) a
24    temporary total disability benefit under the Workers'
25    Compensation Act if the disability results from a condition
26    commonly termed heart attack or stroke or any other

 

 

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1    condition falling within the broad field of coronary
2    involvement or heart disease, or (iii) whole or part pay.
3    (d) For a person employed by an employer, or the retirement
4board, in which "The 1935 Act" was in effect prior to August 1,
51949, from whose salary deductions are first made under "The
61935 Act" or this Article after July 31, 1949, any period of
7service rendered subsequent to the effective date and prior to
8August 1, 1949, shall not be counted as a period of service
9under this Article, except such period for which he made
10payment, as provided in Section 11-221 of this Article, in
11which case such period shall be counted as a period of service
12for all annuity purposes hereunder.
13    (e) In computing the term of service of an employee
14subsequent to the day before the effective date for ordinary
15disability benefit purposes, the following periods of time
16shall be counted as periods of service:
17        (1) any period during which he performed the duties of
18    his position;
19        (2) leaves of absence with whole or part pay;
20        (3) any period of disability for which he received (i)
21    a duty disability benefit under this Article, or (ii) a
22    temporary total disability benefit under the Workers'
23    Compensation Act if the disability results from a condition
24    commonly termed heart attack or stroke or any other
25    condition falling within the broad field of coronary
26    involvement or heart disease, or (iii) whole or part pay.

 

 

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1    However, any period of service rendered by an employee
2contributor prior to the date he became a contributor to the
3fund shall not be counted as a period of service for ordinary
4disability purposes, unless the person made payment for the
5period as provided in Section 11-221 of this Article, in which
6case the period shall be counted as a period of service for
7ordinary disability purposes for periods of disability on or
8after the effective date of this amendatory Act of 1997.
9    Overtime or extra service shall not be included in
10computing any term of service. Not more than 1 year of service
11shall be allowed for service rendered during any calendar year.
12(Source: P.A. 90-511, eff. 8-22-97.)
 
13    (40 ILCS 5/17-134)  (from Ch. 108 1/2, par. 17-134)
14    Sec. 17-134. Contributions for leaves of absence; military
15service; computing service. In computing service for pension
16purposes the following periods of service shall stand in lieu
17of a like number of years of teaching service upon payment
18therefor in the manner hereinafter provided: (a) time spent on
19a leave of absence granted by the employer; (b) service with
20teacher or labor organizations based upon special leaves of
21absence therefor granted by an Employer; (c) a maximum of 5
22years spent in the military service of the United States, of
23which up to 2 years may have been served outside the pension
24period; (d) unused sick days at termination of service to a
25maximum of 244 days; (e) time lost due to layoff and

 

 

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1curtailment of the school term from June 6 through June 21,
21976; and (f) time spent after June 30, 1982 as a member of the
3Board of Education, if required to resign from an
4administrative or teaching position in order to qualify as a
5member of the Board of Education.
6        (1) For time spent on or after September 6, 1948 on
7    sabbatical leaves of absence or sick leaves, for which
8    salaries are paid, an Employer shall make payroll
9    deductions at the applicable rates in effect during such
10    periods.
11        (2) For time spent on a leave of absence granted by the
12    employer for which no salaries are paid, teachers desiring
13    credit therefor shall pay the required contributions at the
14    rates in effect during such periods as though they were in
15    teaching service. If an Employer pays salary for vacations
16    which occur during a teacher's sick leave or maternity or
17    paternity leave without salary, vacation pay for which the
18    teacher would have qualified while in active service shall
19    be considered part of the teacher's total salary for
20    pension purposes. No more than 36 months of leave credit
21    may be allowed any person during the entire term of
22    service. Sabbatical leave credit shall be limited to the
23    time the person on leave without salary under an Employer's
24    rules is allowed to engage in an activity for which he
25    receives salary or compensation.
26        (3) For time spent prior to September 6, 1948, on

 

 

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1    sabbatical leaves of absence or sick leaves for which
2    salaries were paid, teachers desiring service credit
3    therefor shall pay the required contributions at the
4    maximum applicable rates in effect during such periods.
5        (4) For service with teacher or labor organizations
6    authorized by special leaves of absence, for which no
7    payroll deductions are made by an Employer, teachers
8    desiring service credit therefor shall contribute to the
9    Fund upon the basis of the actual salary received from such
10    organizations at the percentage rates in effect during such
11    periods for certified positions with such Employer. To the
12    extent the actual salary exceeds the regular salary, which
13    shall be defined as the salary rate, as calculated by the
14    Board, in effect for the teacher's regular position in
15    teaching service on September 1, 1983 or on the effective
16    date of the leave with the organization, whichever is
17    later, the organization shall pay to the Fund the
18    employer's normal cost as set by the Board on the
19    increment. After the effective date of this amendatory Act
20    of the 97th General Assembly, contributions to the Fund
21    under this subdivision (4) shall be based upon the
22    teacher's regular salary as defined in this subdivision
23    (4).
24        (5) For time spent in the military service, teachers
25    entitled to and desiring credit therefor shall contribute
26    the amount required for each year of service or fraction

 

 

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1    thereof at the rates in force (a) at the date of
2    appointment, or (b) on return to teaching service as a
3    regularly certified teacher, as the case may be; provided
4    such rates shall not be less than $450 per year of service.
5    These conditions shall apply unless an Employer elects to
6    and does pay into the Fund the amount which would have been
7    due from such person had he been employed as a teacher
8    during such time. In the case of credit for military
9    service not during the pension period, the teacher must
10    also pay to the Fund an amount determined by the Board to
11    be equal to the employer's normal cost of the benefits
12    accrued from such service, plus interest thereon at 5% per
13    year, compounded annually, from the date of appointment to
14    the date of payment.
15        The changes to this Section made by Public Act 87-795
16    shall apply not only to persons who on or after its
17    effective date are in service under the Fund, but also to
18    persons whose status as a teacher terminated prior to that
19    date, whether or not the person is an annuitant on that
20    date. In the case of an annuitant who applies for credit
21    allowable under this Section for a period of military
22    service that did not immediately follow employment, and who
23    has made the required contributions for such credit, the
24    annuity shall be recalculated to include the additional
25    service credit, with the increase taking effect on the date
26    the Fund received written notification of the annuitant's

 

 

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1    intent to purchase the credit, if payment of all the
2    required contributions is made within 60 days of such
3    notice, or else on the first annuity payment date following
4    the date of payment of the required contributions. In
5    calculating the automatic annual increase for an annuity
6    that has been recalculated under this Section, the increase
7    attributable to the additional service allowable under
8    this amendatory Act of 1991 shall be included in the
9    calculation of automatic annual increases accruing after
10    the effective date of the recalculation.
11        The total credit for military service shall not exceed
12    5 years, except that any teacher who on July 1, 1963, had
13    validated credit for more than 5 years of military service
14    shall be entitled to the total amount of such credit.
15        (6) A maximum of 244 unused sick days credited to his
16    account by an Employer on the date of termination of
17    employment. Members, upon verification of unused sick
18    days, may add this service time to total creditable
19    service.
20        (7) In all cases where time spent on leave is
21    creditable and no payroll deductions therefor are made by
22    an Employer, persons desiring service credit shall make the
23    required contributions directly to the Fund.
24        (8) For time lost without pay due to layoff and
25    curtailment of the school term from June 6 through June 21,
26    1976, as provided in item (e) of the first paragraph of

 

 

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1    this Section, persons who were contributors on the days
2    immediately preceding such layoff shall receive credit
3    upon paying to the Fund a contribution based on the rates
4    of compensation and employee contributions in effect at the
5    time of such layoff, together with an additional amount
6    equal to 12.2% of the compensation computed for such period
7    of layoff, plus interest on the entire amount at 5% per
8    annum from January 1, 1978 to the date of payment. If such
9    contribution is paid, salary for pension purposes for any
10    year in which such a layoff occurred shall include the
11    compensation recognized for purposes of computing that
12    contribution.
13        (9) For time spent after June 30, 1982, as a
14    nonsalaried member of the Board of Education, if required
15    to resign from an administrative or teaching position in
16    order to qualify as a member of the Board of Education, an
17    administrator or teacher desiring credit therefor shall
18    pay the required contributions at the rates and salaries in
19    effect during such periods as though the member were in
20    service.
21    Effective September 1, 1974, the interest charged for
22validation of service described in paragraphs (2) through (5)
23of this Section shall be compounded annually at a rate of 5%
24commencing one year after the termination of the leave or
25return to service.
26(Source: P.A. 92-599, eff. 6-28-02.)
 

 

 

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1    (40 ILCS 5/17-134.1)
2    Sec. 17-134.1. Labor organization employees.
3    (a) A former teacher who is employed by a teacher or labor
4organization and is not eligible to participate under
5subdivision (4) of Section 17-134 because he or she is not on a
6special leave of absence may elect to participate in the Fund
7for the duration of that employment by so notifying the Fund in
8writing. Participation shall be subject to the same conditions
9as are applicable to persons participating under that
10subdivision (4), and service credit shall be contingent upon
11the required contributions being received by the Fund.
12    (b) A person who participates in the Fund under subsection
13(a) may establish service credit for periods of such employment
14that took place before beginning participation under this
15Section by submitting a written application to the Fund. Credit
16shall be granted upon payment to the Fund of an amount to be
17determined by the Fund, equal to (i) the employee contributions
18that would have been paid if the person had participated under
19subdivision (4) of Section 17-134 during the period for which
20service credit is to be established, based on the actual salary
21received, plus (ii) the employer's normal cost associated with
22that service credit, plus (iii) interest on items (i) and (ii)
23at the rate of 6% per year, compounded annually, from the date
24of the service established to the date of payment. Service
25credit under this subsection shall not be granted until the

 

 

SB2497- 16 -LRB097 13629 AMC 58165 b

1required contribution has been paid in full; the contribution
2may be paid at any time before retirement. After the effective
3date of this amendatory Act of the 97th General Assembly,
4contributions to the Fund under item (i) of this subsection (b)
5shall be based upon the teacher's regular salary as defined in
6subdivision (4) of Section 17-134.
7    (c) A person who participates in the Fund under subsection
8(a) may reestablish any service credits previously forfeited by
9acceptance of a refund by paying to the Fund the amount of the
10refund plus interest thereon at the rate of 5% per annum,
11compounded annually, from the date of the refund to the date of
12payment.
13    (d) Rollover contributions from other retirement plans
14qualified under the Internal Revenue Code of 1986 may be used
15to make the payments required under subsections (b) and (c).
16    (e) No service credit may be established under this Section
17for any period of employment for which the person receives
18service credit under any other provision of this Code.
19(Source: P.A. 90-448, eff. 8-16-97.)
 
20    Section 99. Effective date. This Act takes effect upon
21becoming law.