cynthia lau legislative affairs officer ab 1902
DESCRIPTION
Cynthia Lau Legislative Affairs Officer AB 1902. Comparison of Plan E and Plan D – New Hire Elects One. Prospective Plan Transfer (PPT). D E. E D. May transfer back and forth – may transfer between plans no more than once every 3 years while in period of “active employment.”. - PowerPoint PPT PresentationTRANSCRIPT
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Cynthia LauLegislative Affairs Officer
AB 1902
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Comparison of Plan E and Plan D – New Hire Elects One
Contributory Vesting Final CompActive Disability/Death Benefits
Retirement Benefit
Plan E No 10 yrs. 3 yrs. No Lower
Plan D Yes 5 yrs. 1 yr. Yes Higher
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Prospective Plan Transfer (PPT)
D EE D
May transfer back and forth – may transfer between plans no more than once every 3 years while in period of “active employment.”
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What happens if member is disabled while in Plan D?To apply for disability retirement, PPT transferee must have either:•Two yrs. continuous active service after transfer, or •Earned 5 yrs. service credit under Plan D after transferRequirements prevent Plan E member from transferring to Plan D and immediately filing for disability retirement.
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Issue – Member may be disabled, but ineligible to apply for LACERA disability retirement due to failure to meet 2 yr./5 yr. requirement.
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County Long-Term Disability Plan (LTD) • Provides benefits for Plan D and Plan E members who
are sick or injured and cannot work. • Benefits expire at age 65, or when no longer
disabled.
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• After 2 yrs. on LTD, County requires Plan D (contributory) members to file for retirement in order to continue LTD. • LTD benefit is offset (reduced) by amount of retirement
allowance
• County does not require Plan E members to file for retirement after 2 yrs. to continue LTD.
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Under certain circumstances, it may be more advantageous for the affected member to continue LTD benefits under Plan E than under Plan D.Influencing factors include: •Member’s age•Amount of service credit•Status of LTD Health Insurance
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Currently (Pre-AB 1902)To continue LTD benefits, a disabled Plan D PPT transferee who fails to meet 2 yr./5 yr. requirement may only apply for a service retirement.
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Effective January 1, 2011 (Post-AB 1902)Disabled Plan D PPT transferee who fails to meet 2 yr./5 yr. requirement has options: •May transfer back to Plan E and continue under the County LTD program•Or may file for a service retirement under Plan D
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NOTE: Plan D members electing deferred retirement are ineligible for LTD benefits.
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How can you help?Be aware of this new provision and communicate it to employees. Effective 1-1-11.