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Date: March 7, 2013

Bulletin Number: 1238

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Subject

Tier 6 Retirement Contribution Rate Changes

Purpose

To describe the various retirement systems actions and agency responsibility regarding Tier 6 contribution rates.

Affected Employees

Employees enrolled in Tier 6 in the following Retirement Systems:

  • Employees Retirement System (7Y)
  • Police and Fire Retirement System (7W)
  • New York City Teachers Retirement System (7S)
  • New York City Employees Retirement System (7U)
  • New York City Education Board Retirement System (7T)

Effective Date(s)

Paycheck dated April 4, 2013 for Institution cycle and
April 10, 2013 for Administration cycle

Background

On March 16, 2012, the Governor signed legislation creating Tier 6. This new Tier applies to employees joining a retirement system after March 31, 2012.
Effective with the first checks in April 2013, the legislation required the employee contribution rate to be based on the employees’ annual wage.

The employee contribution rates are:

Wages

Contribution Rate

$45,000 or less

3%

$45,000.01 to $55,000

3.5%

$55,000.01 to $75,000

4.5%

$75,000.01 to $100,000

5.75%

More than $100,000

6%


OSC Actions

For employees enrolled in the NYS Employees Retirement System (7Y) and Police and Fire Retirement System (7W), no agency action will be necessary. OSC will process a file updating the contribution rates as determined by the retirement system.

Information regarding contribution updates for The NY State Teachers Retirement System (7X) will be issued at a later date as the NY State Teachers Retirement System’s contribution rate changes will be effective in July 2013.

Information regarding the Tier 6 contribution rate changes for employees enrolled in the TIAA Retirement System (7Z) will be issued soon in a separate bulletin.

Agency Actions

For Tier 6 employees enrolled in the NY State Employees or the Police and Fire Retirement Systems, no action is necessary as an input file from the retirement system will be processed to update employee payroll records.

 CUNY agencies will receive certification letters from the NY City Teachers, NY City Employees and the NY City Board of Education Retirement Systems containing the new contribution rates for affected Tier 6 employees.  Agencies will be responsible for inserting a new row on the Retirement Plans Page to update the employee rates accordingly in PayServ. When updating the retirement records, please be sure to re enter the employees’ election date.


Questions

Questions concerning this bulletin should be emailed to the Deduction mailbox