FROM: Christina Cintron, Chief of Member Services
SUBJECT: Returning Retiree Program Overview and Metrics
RECOMMENDATION:
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Approve updates to Benefits Policy No. 032, Retirees Returning to Work
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BACKGROUND:
Over the course of the last several months, the Board has had the opportunity to evaluate whether to approve extension requests beyond the initial 18-consecutive months for SBCERA retirees who will be employed by SBCERA employers. At the July 3, 2025 Board meeting, the Board requested that staff bring Benefits Policy No. 032 to the Board for their review and consideration—particularly the sections related to extension requests that are brought to the Board for approval. As a result of this request, staff has prepared this report to provide a brief history of the evolution of the policy and to share program metrics with the Board.
At its August 21, 2025 meeting, the Administrative Committee reviewed the Returning Retiree Program and directed staff to prepare refinements to Benefits Policy No. 032, specifically related to further defining the term “limited duration.” This direction reflected the Committee’s interest in ensuring that the policy language is clear, consistently applied, and responsive to operational realities faced by participating employers.
A "returning retiree" is a SBCERA member who has retired and begun receiving a monthly pension benefit but is later re-employed by an SBCERA-participating employer. While post-retirement employment can be beneficial to address workforce gaps, such arrangements must comply with strict legal limitations to preserve the integrity of the retirement system and prevent abuse.
SBCERA’s Benefits Policy No. 032 (Retirees Returning to Work) exists to ensure that returning to work does not result in inappropriate benefit continuation or accrual, and to enforce legal requirements such as hour caps, waiting periods, and compensation thresholds. The policy is designed to allow limited, temporary employment under defined circumstances—while protecting both the fund and retirees from unintended consequences.
Based upon this request, staff has prepared this report to provide a brief history of the evolution of the policy and to share program metrics with the Board.
Evolution of SBCERA’s Returning Retiree Policy
Since its original adoption in 2015, SBCERA’s Benefits Policy No. 032 (Retirees Returning to Work) has undergone multiple revisions to improve legal clarity, operational consistency, and compliance enforcement. These changes reflect an intentional progression in balancing the organization’s fiduciary responsibilities with the practical workforce needs of participating employers.
From the start, the policy established the concept of “limited duration” for re-employment. The 2015 version allowed certification requests to qualify even without a stated end date, provided the work was genuinely limited in scope and expected to be completed within a foreseeable time. At that time, the policy did not reference “extreme necessity” and did not require Board approval for extensions beyond the original 24-month period. Compliance monitoring provisions were introduced early, requiring employer reporting in specific situations, such as when a retiree reached 700 hours in a fiscal year or was within six months of their re-employment end date.
In 2018, the maximum limited duration period was reduced from 24 to 18 months. For the first time, the policy required that extensions beyond 18 months meet three additional conditions: (1) the re-employment was necessary due to a genuinely extreme necessity that was unavoidable or unforeseen, (2) the work was limited to a discrete, genuinely limited assignment, and (3) the Board of Retirement approved the request. This was the first appearance of both “extreme necessity” and formal Board approval requirements.
The 2020 iteration made no substantive changes to the definitions or application of “limited duration” and “extreme necessity,” retaining the 2018 structure and requirements.
In 2023, the policy clarified that the 18-month period must be 18 consecutive months, removing the earlier “no stated end date” language. It created two clear categories: “Presumed Compliance” (18 consecutive months or less) and “Greater than 18 Consecutive Months” (subject to Board review and approval). “Extreme Necessity” and “Completion of Work” were separately defined, and a new subsection heading titled “No Part-time Employment” was introduced to reinforce the existing prohibition on positions functionally equivalent to permanent part-time work.
Additional changes included clarifying “Reinstatement to Active Service,” strengthening appeal rights by referencing Benefits Policy No. 025 (Requests and Appeals for Pension Benefits), and providing direction on how volunteer service, independent contracting, local board/commission roles, and private-sector work interact with SBCERA retiree re-employment rules.
Annual employer reporting requirements were also added, requiring submission within 10 business days of the end of each fiscal year. Reports must include a list of all SBCERA retirees working in any capacity, along with the total number of hours worked, and staff ensures that every employer responds—whether or not they have known returning retirees.
The 2024 update strengthened violation language and introduced explicit penalty provisions for both employers and retirees in cases of non-compliance. These changes reflected a heightened focus on enforcement, ensuring that violations could be addressed promptly and with meaningful consequences.
Across all iterations, SBCERA has consistently refined Benefits Policy No. 032 to promote transparency, accountability, and lawful, limited re-employment. The policy now provides a clear, enforceable framework that preserves operational flexibility for employers while safeguarding the integrity of the retirement system.
Current Certification Requirements and Enforcement Criteria
SBCERA reviews all Returning Retiree certification requests—both initial and extension submissions—under a consistent framework grounded in Benefits Policy No. 032 and applicable Government Code provisions. Each request must:
• Demonstrate compliance with statutory and policy requirements
• Show a clear and documented operational need
• Include all required supporting documentation
Initial Certification Requests (Staff Approved)
To be eligible for re-employment without reinstatement from retirement, a retiree must meet the following conditions:
• 960-Hour Limit: The retiree may not exceed 960 hours of work per fiscal year across all SBCERA-participating employers.
• 18-Month Limit: Employment is presumed compliant if it does not exceed 18 consecutive months.
• Justification of Operational Need: The position must be necessary to prevent stoppage of public business or requires unique skills for a limited-term assignment.
• Pay Range Compliance: Compensation must be within the range paid to employees performing comparable duties.
• Bona Fide Separation: The retiree must satisfy mandatory waiting periods and may not return to work under pre-arranged conditions.
• Required Documentation:
• Returning Retiree Certification Request Form
• Disability Retirement Questionnaire (if applicable)
• Employment Relationship Questionnaires (for third-party or contractor roles)
Certification Extension Requests (Board Approved)
Requests to continue employment beyond 18 months must be approved by the Board and meet both of the following criteria:
• Extreme Necessity: Re-employment must be essential to enable the employer to continue effective operations due to a genuinely extreme necessity that is unavoidable or could not have been anticipated. The retiree’s departure alone is not considered to have created such a necessity.
• Limited Duration: The remaining assignment must be clearly defined and temporary in nature.
• SBCERA staff also evaluates:
• Recruitment efforts for a permanent replacement
• Updated job duties and pay scale
• Estimated remaining hours and project scope
Reduced manpower alone does not establish limited duration. Vacancies may contribute to operational strain, but extensions must be tied to a specific, time-limited assignment—not general staffing shortages.
The Returning Retiree program is not intended to address long-term staffing needs or function as a substitute for permanent recruitment. Extension requests should reflect a genuine, temporary need that cannot be addressed through regular workforce planning or hiring.
As part of its review, staff may also consider whether the employer has implemented succession planning, cross-training, or temporary staffing strategies to reduce reliance on returning retirees. While not required, this context can help the Board assess the likelihood of future extension requests.
Enforcement and Monitoring
• Employers must report all retirees working under Benefits Policy No. 032 within 10 business days of the new fiscal year and include total hours worked the prior year.
• SBCERA reviews these reports to ensure compliance with hour limits.
• Employers and retirees are required to track hours, respond to staff inquiries, and suspend work if limits are exceeded or extensions are denied.
• Noncompliance may result in benefit suspension, reinstatement to active membership, and a $200/month administrative fee for late reporting.
Returning Retiree Program Metrics
From FY 2020–21 through FY 2024–25, SBCERA approved a total of 144 returning retiree certifications, including initial and extended appointments. The number of certifications has remained relatively stable, with FY 2022–23 marking the highest level of activity (38 certifications), followed closely by FY 2024–25 with 29 finalized certifications.
Over this five-year period, returning retirees consistently represented less than 0.07% of the total retiree population. These figures confirm that the program is used sparingly and aligns with the policy’s intent.
The average duration of:
• Initial certifications are approximately 13.4 months
• First board-approved extensions average 11.2 months
• Second and third board-approved extensions are shorter, averaging 9.7 and 15* months respectively (*this data represents two members)
Approximately four to five participating employers submit Returning Retiree extension requests in any given fiscal year. San Bernardino County consistently represents the majority of these, accounting for an average of 73% of all requests over the last five fiscal years. The South Coast Air Quality Management District (SCAQMD) follows with approximately 16% of all requests. These figures illustrate that Returning Retiree employment is concentrated among a small group of employers with recurring short-term staffing needs.
Returning retirees have primarily served in roles that support transitional needs, project-based assignments, or emergency backfill situations—not ongoing or permanent functions.
Updates to Benefits Policy No. 032 – Retirees Returning to Work
At its recent meeting, the Administrative Committee directed staff to prepare updates to Benefits Policy No. 032 – Retirees Returning to Work. These updates reflect the Committee’s guidance, incorporate prior Board feedback and staff’s administrative experience, and are now presented to the full Board for consideration and approval. The revisions are intended to support the consistent and prudent application of the policy, while maintaining compliance with the County Employees’ Retirement Law (CERL) and the Public Employees’ Pension Reform Act (PEPRA).
• CERL Reference: Government Code § 31680.7 permits retired members to return to employment under specific conditions established by the Board.
• PEPRA Reference: Government Code § 7522.56 restricts post-retirement employment, requiring it to be limited in duration, not exceed 960 hours per fiscal year, and not result from a prearranged agreement.
Definition of “Limited Duration”
The policy has been updated to clarify the definition of “limited duration” to better reflect operational realities—particularly when a retiree is temporarily filling a hard-to-recruit position.
Previously, the policy tied limited duration to the completion of a discrete body of work or special project. The updated language acknowledges that a position may still be considered “limited in duration” if:
• The retiree is temporarily filling a hard-to-recruit position;
• The employer can demonstrate documented, ongoing recruitment efforts;
• The appointment has an expected end point, such as upon hiring or onboarding of a permanent employee.
The policy also identifies criteria for what constitutes a hard-to-recruit position, which may include:
• The requirement of specialized certifications, licenses, or technical skills that are not readily available in the active labor pool, such as:
• Peace Officer Standards and Training (POST) certification
• Firefighter I/II certification
• Emergency Medical Technician (EMT) license
• Commercial Driver’s License (CDL)
• Commercial pilot’s license
• A history of failed recruitment efforts (e.g., position open for three or more months despite active outreach);
• Classification-specific technical or knowledge-based expertise not easily transferable;
• Geographic or compensation-related barriers affecting candidate availability;
• High vacancy rates or turnover in the classification across public sector agencies.
These refinements support employers in justifying requests while reinforcing that returning retirees should not serve as indefinite stopgaps or functional part-time employees. They also maintain compliance with Government Code § 7522.56, which requires re-employment to be limited in duration, and preserves the integrity of the retirement system.
Extensions to Prevent Stoppage of Public Business
The policy has also been updated to clarify the meaning of “prevent stoppage of public business” as used in the provision that allows an extension beyond the 18-month limited duration period.
For purposes of Board consideration, “prevent stoppage of public business” is now defined as the continuation of essential government functions whose interruption would directly compromise public safety, security, or welfare; the safe and orderly operation of courtrooms and other public facilities; or the effective administration of justice.
This includes situations where the absence of a qualified individual would significantly delay or impede critical emergency, safety, or operational response functions; leave the public or employees without necessary protection from imminent harm; disrupt secure operation of courtrooms or facilities; or delay the work of those responsible for reviewing, preparing, and prosecuting criminal cases or carrying out other legal functions essential to the judicial process.
The requirement for Board approval, documentation of necessity, and confirmation of no prearranged employment remains unchanged.
Conclusion
SBCERA’s Returning Retiree program has developed over the past decade into a carefully regulated and narrowly applied tool for addressing short-term workforce gaps. The program’s consistently low participation rate, coupled with strong compliance oversight, demonstrates that it is being used as intended—to provide temporary operational relief without undermining the integrity of the retirement system.
This report has outlined the policy’s evolution, current certification requirements, enforcement practices, and program metrics, providing the Board with the context necessary to evaluate potential refinements. The Administrative Committee’s recent direction to further clarify the definition of “limited duration” and to consider the treatment of hard-to-recruit positions underscores the Board’s commitment to ensuring the policy remains clear, consistent, and responsive to employer needs while honoring SBCERA’s fiduciary responsibilities.
As the Board reviews the proposed updates to Benefits Policy No. 032, staff stands ready to support its deliberations with additional analysis, policy refinements, and implementation measures. In addition, staff can explore enhancements to the Returning Retiree Extension Request form—such as requiring employers to document recruitment efforts, succession planning strategies, and why the position does not warrant permanent part-time classification. These improvements would provide the Board with clearer information to evaluate whether extension requests truly meet the criteria of extreme necessity and limited duration, ensuring that the program continues to balance operational realities with long-term retirement system integrity.
COMMITTEE REVIEW:
This item was reviewed by the Administrative Committee at its August 21, 2025 meeting. The committee suggested the inclusion of additional language providing clarity surrounding “hard to recruit” positions and definition of “limited duration”.
BUDGET IMPACT:
None.
STRATEGIC PLANNING GOAL/OBJECTIVE:
Operational Excellence & Efficiency
STAFF CONTACT:
Christina Cintron
ATTACHMENTS:
Exhibit A: Benefits Policy No. 032 (Retirees Returning to Work)
Exhibit B: Benefits Policy No. 032 (Retirees Returning to Work) - Redline
Exhibit C: Administrative Policy No. 15 (Retirees Returning to Work) – 2015 Version
Exhibit D: Returning Retiree Program: Overview and Metrics Presentation