FROM: Amy McInerny, Chief Financial Officer
SUBJECT: SBCERA Resolution No. 2020-7 - Employer Pay Codes of Employee Compensation
RECOMMENDATION:
title
Adopt SBCERA Resolution No. 2020-7 - Employer Pay Codes of Employee Compensation.
body
BACKGROUND:
The SBCERA Board of Retirement (Board) is required by Government Code Sections 31461, 31542, 7522.10, and 7522.34, as well as Board Benefits Policy No. 26, Compensation Earnable and Pensionable Compensation, to determine what items of member compensation are included or excluded in employee compensation upon which appropriate contribution rates should be applied and upon which retirement benefits are calculated. When an employer presents a new pay item/code, SBCERA staff initially determines whether such items will be considered “compensation earnable” or “pensionable compensation”, which determination will be effective immediately, subject to ratification by the Board.
On June 4, 2020, the Board reviewed and adopted a pay code resolution. Since the adoption, staff reviewed four additional pay code requests from participating employers and made the following determination.
|
Employer |
Pay Item / Code |
Earnable Compensation (Tier I) |
Pensionable Compensation (Tier II) |
|
Crestline Sanitation |
Sick Leave Cashout |
Yes |
No |
|
County of San Bernardino |
Nurses Extra Shift Incentive |
No |
No |
|
Superior Court |
Voluntary Separation Incentive |
No |
No |
|
County of San Bernardino |
Retro - Telestaff Differential |
Yes |
Yes |
|
Mojave Desert AQMD |
Flexible Benefit Dollars - Excess Cash Paid to Member |
Yes* |
No |
|
City of Chino Hills |
Flexible Benefit Opt-Out - Excess Cash Paid to Member |
Yes* |
No |
|
City of Chino Hills |
Flexible Benefit - Excess Cash Paid to Member |
Yes* |
No |
|
City of Big Bear Lake |
Flexible Benefit - Excess Cash Paid to Member |
Yes* |
No |
|
City of Big Bear Lake |
Flexible Benefit Opt-Out - Excess Cash Paid to Member |
Yes* |
No |
|
DWP Big Bear Lake |
Flexible Benefit - Excess Cash Paid to Member |
Yes* |
No |
|
DWP Big Bear Lake |
Flexible Benefit Opt-Out - Excess Cash Paid to Member |
Yes* |
No |
*SBCERA currently includes in compensation earnable certain types of pay that are pending further review and determination pursuant to Government section 31461(b)(1)(A) and Alameda. Upon completion of the review, the Board will determine whether this item will continue to be included in, or will be excluded from, compensation earnable. These items include pay for cash conversion.
Based on the initial determination, staff requests that the Board ratify staff’s determination of the inclusion or exclusion as compensation earnable or pensionable compensation of the above pay item/code.
On August 6, 2020, the Board passed Board Resolution 2020-5 in resonse to the Alameda decision. This resolution includes the changes required by that judicial decision. Specifically, items for pay outside of normal working hours, including Stand-by Pay, On Call Pay, Call Back Pay, Canine Officer Pay, and Weekend Differentials for the Technical and Inspection Unit have been excluded effective January 1, 2013, the effective date of the PEPRA legislation. Items for “in-kind” payments have also been removed and are referred to as “Alameda Exclusions” in Board Resolution 2020-5.
The resolution (Exhibit A) provides a redline version of the changes which includes Exhibits A through L sets out by employer these existing items of compensation, identified by employer pay codes, which will be included in compensation earnable for Tier I members, and Exhibit M sets out pensionable compensation for Tier II members, effective September 3, 2020 for all employers. Exhibit B is a summary of changes to the pay codes. The changes highlight those changes as called out in the table above, and then specifically for those items excluded pursuant to Board Resolution 2020-5.
The resolution is intended to comply with the requirements of the Internal Revenue Code of 1986, the 1937 Act, PEPRA, and the regulations issued thereunder as applicable.
BUDGET IMPACT:
None.
STRATEGIC PLANNING GOAL/OBJECTIVE:
Prudent Fiscal Management
STAFF CONTACT:
Amy McInerny
ATTACHMENTS:
Exhibit A: Pay Code Resolution No. 2020-7 Redline
Exhibit B: Summary of Changes to Pay Code Resolution 2020-7