General Provisions
Retired State Employees Who Resume State Employment

Background

Several provisions have been adopted by the Legislature that affect retired state employees who subsequently resume state employment. This document describes the effect and provides guidance for the reemployment of retired state employees.

Waiting Period Before Reemployment After Retirement

Employees Retirement System (ERS)

Employees who retire from ERS on or after May 31, 2009, may not be reemployed in an ERS-eligible position until 90 days after the retirement date.

Teacher Retirement System (TRS)

Employees who retire from TRS on or after Jan. 1, 2011, may not return to full-time employment in a TRS-eligible position within the 12 consecutive months following the retirement date. Otherwise, the employee will forfeit his or her retirement annuity for the month in which the work occurs.

Retirement Deductions

ERS

ERS retirees who return to work at an agency subject to ERS will no longer contribute a portion of their monthly pay to an ERS retirement account. Therefore, they are not eligible to receive a second retirement from the ERS.

Agencies that hire a person who retires under ERS rules on or after Sept. 1, 2009, will pay a surcharge to ERS equal to the amount that the state would pay for an active member employed in the position for each month the return-to-work retiree is employed by the agency. The percentage is equal to the current state contribution at the time of payment. There are no appropriations for this surcharge.

Exception: Agencies are allowed to use funds appropriated by Senate Bill 30, Section 9.01, 88th Legislature, Regular Session and House Bill 1, GAA, Article IX, Section 17.16, 88th Legislature, Regular Session for the portion of the surcharge related to the salary increases authorized by those acts.

The ERS retirement annuity will not be affected for employees returning to state employment after they retire.

TRS

TRS retirees who return to work at an agency subject to TRS will no longer contribute a portion of their monthly pay to a TRS retirement account. Therefore, they are not eligible to receive a second retirement from the TRS.

Agencies and institutions that hire a person into a TRS-covered position who retired under TRS rules on or after Sept. 1, 2005, are required to pay a pension benefit surcharge to TRS. The amount of the pension surcharge is equal to the amount of both member and state contributions on the compensation paid to the employee.

Regular employment that is half-time or more is covered by TRS. Regular employment is employment that is expected to last four and one-half months or more.

Employment not covered by TRS and not subject to the surcharges includes:

• Substitute service
• Temporary employment (employment expected to last fewer than four and one-half months)
• Less than half-time employment (even as little as one hour less than half-time prevents the surcharge payment)

Longevity Pay

Individuals who retired on or before May 31, 2005, and who returned to state employment before Sept. 1, 2005, are eligible to receive longevity pay equal to the amount to which they were entitled immediately before Sept. 1, 2005.

That longevity pay amount does not change over time, regardless of the amount of lifetime service credit that is accrued following reemployment.

Note: If the return-to-work retiree subsequently leaves state employment for one day or more, longevity pay is discontinued upon return to state employment.

Individuals who retired from state employment on or after June 1, 2005, are ineligible for longevity pay upon reemployment with the state.

Hazardous Duty Pay’s Effect on Longevity Pay for Return-to-Work Retirees

While eligibility to receive hazardous duty pay is not impacted by retirement and return to subsequent employment in a hazardous duty position, individuals who retired on or before May 31, 2005, and returned to state employment before Sept. 1, 2005, and who were receiving hazardous duty pay immediately before Sept. 1, 2005, are only eligible to receive the amount of longevity pay they were entitled to immediately before Sept. 1, 2005. If an individual was receiving hazardous duty pay but not longevity pay immediately before Sept. 1, 2005, and subsequently moves to a position that is not eligible for hazardous duty pay, he or she is not entitled to receive longevity pay. If an individual was receiving both hazardous duty pay and longevity pay immediately before Sept. 1, 2005, and subsequently moves to a position that is not eligible for hazardous duty pay, the amount of longevity pay he or she is entitled to does not increase.

Benefit Replacement Pay

An eligible state employee who retired from state employment on or after June 1, 2005, and who receives an annuity based wholly or partly on services as a state officer or state employee in a public retirement system, is ineligible to receive benefit replacement pay upon reemployment with the state.

Vacation Leave Accruals and Retirees

Vacation leave accruals for return-to-work retirees are based on retirement dates. An employee returning to state employment who retired from state employment on or after June 1, 2005, and who receives a state retirement annuity, accrues vacation leave based only on the employee’s length of service earned after the employee’s retirement date.

Exception

Employees who, between Sept. 1, 2021, and April 30, 2023, began receiving their ERS retirement annuity without separating from their employment, and who remain actively employed with no break in service, are not subject to the limitations described above. If otherwise eligible, these employees retain their entitlement to longevity pay and benefit replacement pay, and their leave accruals are not affected due to receiving a retirement annuity. However, neither the employee nor the employer is required to make any retirement contributions.

Sources

Texas Government Code, Sections 659.044(f), 659.042, 659.126 (d), 661.152 (l); Texas Government Code, Section 812.201, 812.202, 812.205, 812.206, 824.602, 825.4092.