The ERS retirement plans and disability and death benefits for Tier 5 members are the same as the current Article 15 (Tier 4) benefits with the following exceptions:

Member Contributions

• Members must contribute 3 percent of their salary for all their years of public service, except:
  • State Correction Officers whose contributions would be limited to 30 years of service and
  • Uniformed Court Officers and Peace Officers employed by the Unified Court System who would contribute 4 percent of their salary for all their years of public service.
• Tier 5 contributions are tax-deferred until they are distributed under Internal Revenue Code Section 414(h).
• Tier 5 ERS Members can borrow against their contributions once they meet eligibility requirements.

Vesting

• Members must have ten years of service credit to be vested and eligible for retirement benefits.

Reduction for Early Retirement

• Early retirement reductions for members retiring prior to age 62 are greater.
• Retirement benefits of members retiring between age 55 and 62 will be reduced for early retirement — even if they have 30 years of service credit (except for Uniformed Court Officers and Peace Officers employed by the Unified Court System).

Overtime Limitation

• Overtime pay in excess of an annual cap is not included in the definition of wages. It should not be reported to the Retirement System and cannot be used in a final average salary calculation.
• This overtime cap for calendar year 2012 is $15,913.50. The maximum reportable overtime increases by 3 percent each calendar year. See the ERS Overtime Limits tables below.
• Overtime should be reported to the Retirement System until the member has reached the overtime cap for that calendar year. Once the cap has been reached, any additional overtime paid to that member for the remainder of the calendar year should not be reported. The member must still be reported, however, overtime pay that exceeds the cap should not be reported. In addition, contributions should not be collected on any overtime amounts greater than the cap.