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Regular Session, 2010
SENATE BILL NO. 704
BY SENATOR SHAW
RETIREMENT SYSTEMS. Provides relative to military service credit and compliance with
the Uniformed Services Employment and Reemployment Rights Act of 1994 (USERRA).
(6/30/10)
AN ACT1
To amend and reenact R.S. 29:414(C) and (D), relative to credit in the public retirement2
systems for service in the uniformed services; to provide for payment of3
contributions to public retirement systems for such service credit; to provide for time4
periods for payment of such contributions; to provide for an effective date; and to5
provide for related matters.6
Notice of intention to introduce this Act has been published.7
Be it enacted by the Legislature of Louisiana:8
Section 1. R.S. 29:414(C) and (D) are hereby amended and reenacted to read as9
follows: 10
ยง414. Public retirement systems; payment of contributions; interest 11
* * *12
C. All employee contributions and interest due thereon made in payment for13
retirement credit for service in the uniformed services credit in accordance with14
Subsection A of this Section must shall be received by the system within four years15
of his a time period immediately after the employee's reemployment pursuant to16
this Part equal to three times the period of qualified military service, not to17 SB NO. 704
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exceed five years.1
D. Should the employee fail to make the required contributions within four2
years, the permissible payment period under Subsection C of this Section, credit3
for service in the uniformed services credit shall only count toward determining4
eligibility for retirement benefits. Any unpaid actuarial cost to the retirement system5
shall be borne by the employers through reflection in the employer contribution rate6
established by the Public Retirement Systems Systems' Actuarial Committee.7
Section 2. Any employee whose service in the uniformed services begins on or8
before June 30, 2010, shall be granted no less than four years in which to purchase his9
service credit. 10
Section 3. This Act shall become effective on June 30, 2010; if vetoed by the11
governor and subsequently approved by the legislature, this Act shall become effective on12
June 30, 2010, or on the day following such approval by the legislature, whichever is later.13
The original instrument and the following digest, which constitutes no part
of the legislative instrument, were prepared by Lauren B. Bailey.
DIGEST
Present state law provides generally for the Military Service Relief Act (R.S. 29:401-426),
intended to supplement rights pursuant to federal laws, including the Uniformed Services
Employment and Reemployment Rights Act (USERRA, 38 U.S.C. 4301 et seq.), of persons
called to military service. Provides that it is the policy of the state of Louisiana that her
citizens who serve their country and state and who leave their employment, homes, and
education shall not be penalized nor economically disadvantaged because of their uniformed
service.
Proposed law retains present law.
Present law provides for retirement system and pension benefit plan credit generally for
service in the uniformed services (R.S. 29:411- 415.1). Provides that any employee who
completes his service in the uniformed services and applies for reemployment upon release
from service in the uniformed services or discharge from hospitalization incidental to his
service in the uniformed services, shall be entitled to receive creditable service for such
period of service in the uniformed services toward vesting and computation of benefits in
the retirement system, pension fund, or employee benefit plan applicable to his employment,
as further provided pursuant to present law.
Proposed law retains present law.
Present law (R.S. 29:412) provides that, if permitted by the Internal Revenue Code, an
employee may elect to continue paying required employee contributions to his system, fund,
or plan with qualified plan status during his period of service in the uniformed services.
Specifies that the employee shall timely furnish his employer with sums equal to those which
would have been deducted from his compensation for retirement system coverage, as SB NO. 704
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required under his public retirement system or employee benefit plan. Provides that upon
receipt of the employee's contributions, the employer shall remit the contributions to the
system or plan, including the employer contributions that would have been contributed on
behalf of the employee. Provides that the employee shall notify his employer of his election
to pay the required employee contributions to the applicable system or plan at the time he
enters service in the uniformed services.
Proposed law retains present law.
Present law relative to public retirement systems (R.S. 29:414) provides that any employee
who did not elect to make employee contributions pursuant to present law (R.S. 29:412)
during his period of service in the uniformed services shall be entitled to receive credit in
his public retirement system for such period of service. Provides that such credit shall be
used for eligibility purposes and for computation of benefits upon the employee's payment
to the system of an amount equal to the employee contributions that would have been paid
had the employee continued in employment and not been called to service in the uniformed
services, together with interest thereon at the valuation interest rate of the system or plan in
effect at the time payment is made. Provides that the contributions shall be based on the
salary, including any increases in compensation, that the employee would have received had
he remained in employment during the period of service in the uniformed services.
Proposed law retains present law.
Present law provides that within 30 days after the payment of the employee contributions
and interest due pursuant to present law, the employer shall pay to the system an amount
equal to the employer contributions that the employer would have paid had the employee
remained in service, together with interest thereon at the valuation interest rate in effect at
the time payment is made. Provides that such contributions shall be based on the salary the
employee would have received during the period of service in the uniformed services,
including any increases in compensation that the employee would have received had he
remained in employment during the period of service in the uniformed services.
Proposed law retains present law.
Present federal law (38 U.S.C. 4318(b)(2)) provides that the duration of the permissible
payment period for such required employee contributions shall be three times the employee's
period of service in the uniformed services, such payment period not to exceed five years.
Present state law provides that all required employee contributions and interest paid pursuant
to present law for retirement credit for service in the uniformed services shall be received
by the system within four years of the employee's reemployment.
Proposed law provides that all contributions and interest paid pursuant to present law shall
be received by the system within a time period immediately after the employee's
reemployment equal to three times the period of qualified military service. Provides,
however, that in no case shall the permissible payment period exceed five years.
Present law provides that if the employee fails to make the required contributions within the
statutory time frame of four years, credit in the retirement system for service in the
uniformed services shall only count toward determining eligibility for retirement benefits.
Proposed law retains present law and changes the referenced time frame to the permissible
payment period.
Present law provides that any unpaid actuarial cost to the system shall be borne by the
employers through reflection in the employer contribution rate established by the Public
Retirement Systems' Actuarial Committee. SB NO. 704
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words in boldface type and underscored are additions.
Proposed law retains present law.
Proposed law provides that any employee whose service in the uniformed services begins
on or before June 30, 2010, shall be granted no less than four years in which to purchase his
service credit.
Effective June 30, 2010.
(Amends R.S. 29:414(C) and (D))