Illinois General Assembly - Full Text of SB1687
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Full Text of SB1687  98th General Assembly




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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 15-126.1, 15-139, 15-139.5, and 15-168.2 as follows:
6    (40 ILCS 5/15-126.1)  (from Ch. 108 1/2, par. 15-126.1)
7    Sec. 15-126.1. Academic year. "Academic year": The
812-month period beginning on the first day of the fall term as
9determined by each employer, or if the employer does not have
10an academic program divided into terms, then beginning
11September 1. For the purposes of Section 15-139.5 and
12subsection (b) of Section 15-139, however, "academic year"
13means the 12-month period beginning September 1.
14(Source: P.A. 84-1472.)
15    (40 ILCS 5/15-139)  (from Ch. 108 1/2, par. 15-139)
16    Sec. 15-139. Retirement annuities; cancellation; suspended
17during employment.
18    (a) If an annuitant returns to employment for an employer
19within 60 days after the beginning of the retirement annuity
20payment period, the retirement annuity shall be cancelled, and
21the annuitant shall refund to the System the total amount of
22the retirement annuity payments which he or she received. If



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1the retirement annuity is cancelled, the participant shall
2continue to participate in the System.
3    (b) If an annuitant retires prior to age 60 and receives or
4becomes entitled to receive during any month compensation in
5excess of the monthly retirement annuity (including any
6automatic annual increases) for services performed after the
7date of retirement for any employer under this System, that
8portion of the monthly retirement annuity provided by employer
9contributions shall not be payable.
10    If an annuitant retires at age 60 or over and receives or
11becomes entitled to receive during any academic year
12compensation in excess of the difference between his or her
13highest annual earnings prior to retirement and his or her
14annual retirement annuity computed under Rule 1, Rule 2, Rule
153, Rule 4, or Rule 5 of Section 15-136, or under Section
1615-136.4, for services performed after the date of retirement
17for any employer under this System, that portion of the monthly
18retirement annuity provided by employer contributions shall be
19reduced by an amount equal to the compensation that exceeds
20such difference.
21    However, any remuneration received for serving as a member
22of the Illinois Educational Labor Relations Board shall be
23excluded from "compensation" for the purposes of this
24subsection (b), and serving as a member of the Illinois
25Educational Labor Relations Board shall not be deemed to be a
26return to employment for the purposes of this Section. This



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1provision applies without regard to whether service was
2terminated prior to the effective date of this amendatory Act
3of 1991.
4    "Academic year", as used in this subsection (b), means the
512-month period beginning September 1.
6    (c) If an employer certifies that an annuitant has been
7reemployed on a permanent and continuous basis or in a position
8in which the annuitant is expected to serve for at least 9
9months, the annuitant shall resume his or her status as a
10participating employee and shall be entitled to all rights
11applicable to participating employees upon filing with the
12board an election to forgo all annuity payments during the
13period of reemployment. Upon subsequent retirement, the
14retirement annuity shall consist of the annuity which was
15terminated by the reemployment, plus the additional retirement
16annuity based upon service granted during the period of
17reemployment, but the combined retirement annuity shall not
18exceed the maximum annuity applicable on the date of the last
20    The total service and earnings credited before and after
21the initial date of retirement shall be considered in
22determining eligibility of the employee or the employee's
23beneficiary to benefits under this Article, and in calculating
24final rate of earnings.
25    In determining the death benefit payable to a beneficiary
26of an annuitant who again becomes a participating employee



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1under this Section, accumulated normal and additional
2contributions shall be considered as the sum of the accumulated
3normal and additional contributions at the date of initial
4retirement and the accumulated normal and additional
5contributions credited after that date, less the sum of the
6annuity payments received by the annuitant.
7    The survivors insurance benefits provided under Section
815-145 shall not be applicable to an annuitant who resumes his
9or her status as a participating employee, unless the
10annuitant, at the time of initial retirement, has a survivors
11insurance beneficiary who could qualify for such benefits.
12    If the participant's employment is terminated because of
13circumstances other than death before 9 months from the date of
14reemployment, the provisions of this Section regarding
15resumption of status as a participating employee shall not
16apply. The normal and survivors insurance contributions which
17are deducted during this period shall be refunded to the
18annuitant without interest, and subsequent benefits under this
19Article shall be the same as those which were applicable prior
20to the date the annuitant resumed employment.
21    The amendments made to this Section by this amendatory Act
22of the 91st General Assembly apply without regard to whether
23the annuitant was in service on or after the effective date of
24this amendatory Act.
25(Source: P.A. 97-933, eff. 8-10-12; 97-968, eff. 8-16-12.)



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1    (40 ILCS 5/15-139.5)
2    Sec. 15-139.5. Return to work by affected annuitant; notice
3and contribution by employer.
4    (a) An employer who employs or re-employs a person
5receiving a retirement annuity from the System in an academic
6year beginning on or after August 1, 2014 2013 must notify the
7System of that employment within 60 days after employing the
8annuitant. The notice must include a summary copy of the
9contract of employment or ; if no written contract of employment
10exists, then the notice must specify the rate of compensation
11and the anticipated length of employment of that annuitant. The
12notice must specify whether the annuitant will be compensated
13from federal, corporate, foundation, or trust funds or grants
14of State funds that identify the principal investigator by
15name. The notice must include the employer's determination of
16whether or not the annuitant is an "affected annuitant" as
17defined in subsection (b).
18    The employer must also record, document, and certify to the
19System (i) the number of paid days and paid weeks worked by the
20annuitant in the academic year, (ii) the amount of compensation
21paid to the annuitant for employment during the academic year,
22and (ii) (iii) the amount of that compensation, if any, that
23comes from either federal, corporate, foundation, or trust
24funds or grants of State funds that identify the principal
25investigator by name.
26    As used in this Section, "academic year" means the 12-month



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1period beginning September 1. has the meaning ascribed to that
2term in Section 15-126.1; "paid day" means a day on which a
3person performs personal services for an employer and for which
4the person is compensated by the employer; and "paid week"
5means a calendar week in which a person has at least one paid
7    For the purposes of this Section, an annuitant whose
8employment by an employer extends over more than one academic
9year shall be deemed to be re-employed by that employer in each
10of those academic years.
11    The System may specify the time, form, and manner of
12providing the determinations, notifications, certifications,
13and documentation required under this Section.
14    (b) A person receiving a retirement annuity from the System
15becomes an "affected annuitant" on the first day of the
16academic year following the academic year in which the
17annuitant first meets both of the following condition
19        (1) (Blank). While receiving a retirement annuity
20    under this Article, the annuitant has been employed on or
21    after August 1, 2013 by one or more employers under this
22    Article for a total of more than 18 paid weeks (which need
23    not have been with the same employer or in the same
24    academic year); except that any periods of employment for
25    which the annuitant was compensated solely from federal,
26    corporate, foundation, or trust funds or grants of State



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1    funds that identify the principal investigator by name are
2    excluded.
3        (2) While receiving a retirement annuity under this
4    Article, the annuitant was employed on or after August 1,
5    2014 2013 by one or more employers under this Article and
6    received or became entitled to receive during an academic
7    year compensation for that employment in excess of 40% of
8    his or her highest annual earnings prior to retirement;
9    except that compensation paid from federal, corporate,
10    foundation, or trust funds or grants of State funds that
11    identify the principal investigator by name is excluded.
12    A person who becomes an affected annuitant remains an
13affected annuitant, except for any period during which the
14person returns to active service and does not receive a
15retirement annuity from the System.
16    (c) It is the obligation of the employer to determine
17whether an annuitant is an affected annuitant before employing
18the annuitant. For that purpose the employer may require the
19annuitant to disclose and document his or her relevant prior
20employment and earnings history. Failure of the employer to
21make this determination correctly and in a timely manner or to
22include this determination with the notification required
23under subsection (a) does not excuse the employer from making
24the contribution required under subsection (e).
25    The System may assist the employer in determining whether a
26person is an affected annuitant. The System shall inform the



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1employer if it discovers that the employer's determination is
2inconsistent with the employment and earnings information in
3the System's records.
4    (d) Upon the request of an annuitant, the System shall
5certify to the annuitant or the employer the following
6information as reported by the employers, as that information
7is indicated in the records of the System: (i) the annuitant's
8highest annual earnings prior to retirement, (ii) the number of
9paid weeks worked by the annuitant for an employer on or after
10August 1, 2013, (iii) the compensation paid for that employment
11in each academic year, and (iii) (iv) whether any of that
12employment or compensation has been certified to the System as
13being paid from federal, corporate, foundation, or trust funds
14or grants of State funds that identify the principal
15investigator by name. The System shall only be required to
16certify information that is received from the employers.
17    (e) In addition to the requirements of subsection (a), an
18employer who employs an affected annuitant must pay to the
19System an employer contribution in the amount and manner
20provided in this Section, unless the annuitant is compensated
21by that employer solely from federal, corporate, foundation, or
22trust funds or grants of State funds that identify the
23principal investigator by name.
24    The employer contribution required under this Section for
25employment of an affected annuitant in an academic year shall
26be equal to 12 times the amount of the gross monthly retirement



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1annuity payable to the annuitant for the month in which the
2first paid day of that employment in that academic year occurs,
3after any reduction in that annuity that may be imposed under
4subsection (b) of Section 15-139.
5    If an affected annuitant is employed by more than one
6employer in an academic year, the employer contribution
7required under this Section shall be divided among those
8employers in proportion to their respective portions of the
9total compensation paid to the affected annuitant for that
10employment during that academic year.
11    If the System determines that an employer, without
12reasonable justification, has failed to make the determination
13of affected annuitant status correctly and in a timely manner,
14or has failed to notify the System or to correctly document or
15certify to the System any of the information required by this
16Section, and that failure results in a delayed determination by
17the System that a contribution is payable under this Section,
18then the amount of that employer's contribution otherwise
19determined under this Section shall be doubled.
20    The System shall deem a failure to correctly determine the
21annuitant's status to be justified if the employer establishes
22to the System's satisfaction that the employer, after due
23diligence, made an erroneous determination that the annuitant
24was not an affected annuitant due to reasonable reliance on
25false or misleading information provided by the annuitant or
26another employer, or an error in the annuitant's official



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1employment or earnings records.
2    (f) Whenever the System determines that an employer is
3liable for a contribution under this Section, it shall so
4notify the employer and certify the amount of the contribution.
5The employer may pay the required contribution without interest
6at any time within one year after receipt of the certification.
7If the employer fails to pay within that year, then interest
8shall be charged at a rate equal to the System's prescribed
9rate of interest, compounded annually from the 366th day after
10receipt of the certification from the System. Payment must be
11concluded within 2 years after receipt of the certification by
12the employer. If the employer fails to make complete payment,
13including applicable interest, within 2 years, then the System
14may, after giving notice to the employer, certify the
15delinquent amount to the State Comptroller, and the Comptroller
16shall thereupon deduct the certified delinquent amount from
17State funds payable to the employer and pay them instead to the
19    (g) If an employer is required to make a contribution to
20the System as a result of employing an affected annuitant and
21the annuitant later elects to forgo his or her annuity in that
22same academic year pursuant to subsection (c) of Section
2315-139, then the required contribution by the employer shall be
24waived, and if the contribution has already been paid, it shall
25be refunded to the employer without interest.
26    (h) Notwithstanding any other provision of this Article,



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1the employer contribution required under this Section shall not
2be included in the determination of any benefit under this
3Article or any other Article of this Code, regardless of
4whether the annuitant returns to active service, and is in
5addition to any other State or employer contribution required
6under this Article.
7    (i) Notwithstanding any other provision of this Section to
8the contrary, if an employer employs an affected annuitant in
9order to continue critical operations in the event of either an
10employee's unforeseen illness, accident, or death or a
11catastrophic incident or disaster, then, for one and only one
12academic year, the employer is not required to pay the
13contribution set forth in this Section for that annuitant. The
14employer shall, however, immediately notify the System upon
15employing a person subject to this subsection (i). For the
16purposes of this subsection (i), "critical operations" means
17teaching services, medical services, student welfare services,
18and any other services that are critical to the mission of the
20    (j) This Section shall be applied and coordinated with the
21regulatory obligations contained in the State Universities
22Civil Service Act. This Section shall not apply to an annuitant
23if the employer of that annuitant provides documentation to the
24System that (1) the annuitant is employed in a status
25appointment position, as that term is defined in 80 Ill. Adm.
26Code 250.80, and (2) due to obligations contained under the



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1State Universities Civil Service Act, the employer does not
2have the ability to limit the earnings or duration of
3employment for the annuitant while employed in the status
4appointment position.
5(Source: P.A. 97-968, eff. 8-16-12.)
6    (40 ILCS 5/15-168.2)
7    Sec. 15-168.2. Audit of employers. Beginning August 1, 2014
82013, the System may audit the employment records and payroll
9records of all employers. When the System audits an employer,
10it shall specify the exact information it requires, which may
11include but need not be limited to the names, titles, and
12earnings history of every individual receiving compensation
13from the employer. If an employer is audited by the System,
14then the employer must provide to the System all necessary
15documents and records within 60 calendar days after receiving
16notification from the System. When the System audits an
17employer, it shall send related correspondence by certified
19(Source: P.A. 97-968, eff. 8-16-12.)
20    Section 99. Effective date. This Act takes effect upon
21becoming law.