LAGERS has pre-filed legislation that seeks to further enhance the flexibility of the retirement system. Currently under law, an employer has many options to tailor a retirement benefit that will meet the goals and needs of its unique workforce. The options for employer election range from the benefit multiplier, final average salary, retirement ages, and employee contributions.
House Bill 1467 and Senate Bill 768 are companion bills that would expand an employer’s options available for employee contributions. An employer can currently elect to require all eligible employees to contribute 4% of their gross wage to help pay for the retirement benefit (also called Contributory), or the employer may elect to cover the full cost of the benefit with no employee contribution (also called Non-Contributory). The proposed legislation would expand the available options from 0% and 4% to 0%, 2%, 4%, and 6%.
This proposal is the result of many years of conversation between LAGERS employers, members, and affiliate organizations. LAGERS recognizes that no two employers in the system are the same and the flexibility of LAGERS’ plan design is one of the greatest assets for the system and the members we serve.
If passed, the legislation would not automatically make any changes to an employer’s election, rather, it would simply add additional options for election in the future. LAGERS believes that with this added flexibility, employers will have even greater ability to fine tune a retirement benefit for their workforce that helps attract and retain the highest quality public servants into local government service and ultimately helps prepare each employee for a secure and dignified retirement.
Join us this Thursday for a Facebook Live, where we will talk more about the bill and upcoming session!