Your pension is based on your years of credited service and your final average earnings (FAE). For members in Tiers 2, 3 and 5, your FAE is the average of your highest three consecutive years of earnings. For Tier 6 members, your FAE is the average of your highest five consecutive years. Usually these are the years right before retirement, but they can be anytime in your career.
Your FAE can include, but is not limited to, the payments listed below. Payments must be earned in the FAE period. In some cases, certain restrictions may apply (see Restrictions and Limitations):
- Regular earnings;
- Overtime earned in the FAE period;
- Compensatory overtime;
- Holiday pay; and
- Longevity payments (maximum of one per FAE year), if earned in the years used in the FAE calculation.
The following payments are not part of your regular compensation. In most cases, they will not be included in your FAE calculation:
- Unused vacation;
- Unused sick leave;
- Payments made as a result of working your vacation;
- Any form of termination pay;
- Payments made in anticipation of retirement; and
- Any payments made for time not worked.