State Agencies Bulletin No. 1886

Subject
Two-Year Look Back for Tier 6 Voluntary Defined Contribution Program (VDC)
Date Issued
December 22, 2020

Purpose

The purpose of this bulletin is to provide agencies with instructions on how to update a Tier 6 employee’s Retirement Plan page due to the two-year look back.

Affected Employees

Tier 6 New York State employees who are members of the VDC are affected.

Background

On March 16, 2012, the Governor signed legislation creating Tier 6. This tier applies to employees joining a retirement system after March 31, 2012. This Legislation authorized the creation of a new Tier 6 pension plan that included a Voluntary Defined Contribution Plan. (Please refer to Payroll Bulletin 1256.)

Effective with the first checks in April 2013, Legislation required the employee contribution rate to be based on the employee’s annual wage.

Once a Tier 6 member has reached three years of membership, his or her contribution rate is based on annual pensionable salary from two years prior*.

*Total salary should include pensionable salary from all PayServ job records, as well as agencies that are not in PayServ.

The employee contribution rates are:

Wages Contribution Rate 
$45,000.00 or less 3%
$45,000.01 to $55,000.00 3.5%
$55,000.01 to $75,000.00 4.5%
$75,000.01 to $100,000.00  5.75%
$100,000.01 and Greater 6%

The Benefit Plans and the narrative descriptions are found below.

Note: The variable contribution rates are identified within the description.

Benefit Plan  Description
T6V030 VDC TIER 6 3PCT
T6V035 VDC TIER 6 3.5PCT
T6V045 VDC TIER 6 4.5PCT
T6V575 VDC TIER 6 5.75PCT 
T6V060 VDC TIER 6 6PCT

Effective Dates

Changes will take effect for the February 3, 2021 (Administration cycle) and February 11, 2021 (Institution cycle) paychecks.

Agencies must adhere to the 2020-2021 Agency Submission Schedule when updating the Retirements Plan panel in PayServ.

Eligibility Criteria

Tier 6 VDC members who enrolled in the VDC between July 1, 2013 and January 1, 2018 are eligible.

Agency Actions

Each agency is required to update the Retirement Plans page to change the Benefit Plan based on the agency’s review of the “two-year look back” salary.

The public query, Q92_2_YR_LOOKBACK_VDC_P2 will provide the employee’s earnings by Department ID for the calendar year entered. If the query results in multiple rows for an employee, the earnings from each row must be combined to determine the “two-year look back” salary. The query will prompt for Calendar Year – Enter 2019.

The charts found in the “Background” section of this bulletin should be used to determine if the contribution rate has changed and an update to their Benefit Plan is needed.

The Retirement Plans page should be updated for employees with a Payroll Status of Active, Leave of Absence, Leave with Pay, and Terminated.

The steps to update the Benefit Plan are as follows:

  • 1. Open the Retirement Plans page. (Home>Benefits>Enroll In Benefits>Retirement Plans).
  • 2. Enter employee's Empl ID in search box.
  • 3. Click Search.
  • 4. Select the correct Empl Rcd # for the corresponding Job Record (if multiple records exist).
  • 5. Insert a row in the “Coverage” section and enter the payroll period begin date in the Deduction Begin Date field.
  • 6. Enter the employee’s Date of Membership in the “Election Date” field. The same election date should be carried forward from the previous page.
  • 7. Select the appropriate Benefit Plan dependent upon the employees’ total annual earnings. (Use the charts provided in the “Background” section to determine the new Benefit Plan)
  • 8. Save the transaction.
  • 9. Enter General Comments stating “Retirement Plans page updated for 2021 Two Year Look-back.”

Questions

Questions regarding the VDC two-year look back should be directed to SUNY U-Wide Benefits at: [email protected].

Questions regarding the PayServ entry may be directed to the Payroll Retirement mailbox.