NON-ERB EMPLOYMENT
ERB retirees may work for a non-ERB employer at any time without affecting retirement benefits. This includes working for New Mexico state agencies or local government entities that are part of the Public Employees Retirement Association (PERA). This also includes employment outside of New Mexico. Notice to ERB is not required. However, please be aware that if you work for a third-party entity who then asks you to perform duties or provide services for an ERB employer you are still subject to return-to work restrictions. A retiree cannot engage with a third-party entity merely as a way to avoid return-to-work requirements.

 

In general, an ERB member is not allowed to be in retirement status and at the same time be engaged in employment with an ERB employer. However, retired members may return to work under either the Return to Work Program (RTW) or the Return to Work Exception (RTWE).  This applies to those members who retired under the ERB Regular Plan or the Alternative Retirement Plan (ARP). Retirees who return to work without participating in either the RTW Program or the RTW Exception will be required to suspend their pension benefits.

 

RETURN TO WORK PROGRAM (RTW)

The RTW Program allows educators who have chosen to retire, the option of continuing to offer their skills and experience to New Mexico’s schools, colleges and universities without having to suspend their retirement. The RTW Program was created pursuant to a statute that the New Mexico Legislature adopted in 2001 and most recently amended in 2011. See Section 22-11-25.1 NMSA 1978. The RTW Program allows retirees to resume working for an ERB employer without affecting their retirement benefit after completing a layout of 12 consecutive months.  Retirees who apply for the RTW Program can choose to work full time or part-time, with no restrictions on the income that they can earn.  As required by Section 22-11-25.1(E), retirees who choose to work under the RTW Program must pay the Fund an amount equal to the contributions that active members pay.  The contributions are non-refundable. The RTW program is established by legislation and is subject to legislative change. The RTW program is scheduled to sunset on January 1, 2022.

 

RETURN TO WORK EXCEPTION

Retirees can choose to work for an ERB employer after retirement under either of the RTW Exceptions, whichever is greater: (i) earning $15,000 or less per fiscal year, or (ii) working no more than 0.25 FTE (i.e., 25% of full time equivalent for that position) and earning no more than 25% of the full time equivalent salary for that position per fiscal year.  See Rule 2.82.2.11(B) NMAC.  Retirees who work under the RTW Exception are not required to meet the RTW Program requirements, but they must comply with the greater of the earning or workload limitations of the RTW Exception

 

 

The ARP and the RTW PROGRAM and the RTW EXCEPTION

The requirements of the RTW Program and the RTW Exception also apply to persons retiring under the ARP.  ARP retirees working under the RTW Program must pay the non-refundable contributions to the Fund.  See, ERB Executive Director’s Policy Regarding Contributions by Retirees Working Pursuant to the Return to Work Program, effective July 1, 2011.

 

The Q&A below addresses some of the questions the ERB has been asked about the RTW Program and the RTW Exception.  If you have any questions about the RTW Program, the RTW Exception or other work after retiring, you should contact the ERB.  Having your questions answered generally only takes a short time.

 

Questions and Answers about Working for an ERB Employer after Retirement  -  Updated 06/10/2013

 

Q:  Do I have to apply to participate in the Return to Work Program?

 

A.  Yes.  Retirees from the Defined Benefit Plan and the ARP retiring after January 1, 2001 who want to participate in the RTW Program must submit an application, which can be found on ERB’s website at the “downloadable forms” tab.  Retirees who only want to work under the part-time RTW Exception do not need to submit an application.

 

Q: Do I have to layout 12 months after retirement in order to qualify for the RTW Program?

 

A: Yes. The layout (a/k/a a “break in service”) must have commenced after the effective date of retirement and been completed prior to the first day of re-employment but need not have been the twelve consecutive months immediately prior to the first day of such re-employment (i.e. the break in service could have occurred at any time during the period after the effective date of retirement and before the first day of re-employment but must have been at least twelve consecutive months within that period).

 

Note: If you retired before January 1, 2001 and have not since suspended your retirement or been required to suspend your benefits, you do NOT need the 12 month layout.

 

Q: What do you mean by “layout”?

 

A: In the 12 consecutive month layout period you cannot have performed any work for an ERB employer of any nature whatsoever.  This includes all employment, whether full time or part time, substitute teaching or services rendered as an independent contractor. You also cannot have served as a volunteer in a position that would otherwise be, or in the past has been, performed by a paid employee or an independent contractor.  You CAN work for any non-ERB employer as long as the non-ERB employer was not performing work under a contract with an ERB employer.

 

Q: Can I go work for a PERA employer as part of my 12 consecutive month layout?

 

A: Yes, most ERB retirees can work for a New Mexico Public Employees Retirement Association employer during their layout period. The only exception would be if the ERB retiree is a licensed educator working for certain state agencies that have an educational program. If this would be the case for you, you most likely could not work for that employer unless you had already completed your 12 month layout.  ERB retirees should be aware that if they work for a PERA employer, they cannot contribute to PERA and cannot earn time toward a PERA pension. If you hold a valid teaching license and are considering working for a state agency that has an educational program, you may be subject to the RTW requirements. Retirees who are considering working for a state agency with an educational program should contact ERB for confirmation of whether they are subject to the RTW requirements.

 

Q: What happens if a retiree from the Defined Benefit Plan exceeds the RTW Exception limits?

 

A: Earning more than $15,000.00 in a fiscal year or working more than 0.25 FTE and earning more than 25% of the full time equivalent salary for the position will result in the retiree being removed from the RTW Exception. If the retiree from the Defined Benefit Plan exceeds the limits, i.e. earns or works more than the allowable limits, the retiree will be required to return to active status, commence paying non-refundable contributions and have their retirement benefits suspended. The retiree will also be required to pay back benefits received for the period of time the retiree exceeded the limits. Upon being returned to active status, the retiree will earn additional service credit which will be factored into the calculation of the retiree’s benefits upon re-retirement.  ARP participants should see the Q and A further down regarding the ARP and the RTW Exception.

 

Q. What is “full time equivalent?”

 

A.  Each ERB employer determines what is “full time” for each of the positions with that employer and the basis for making that determination; i.e., whether the determination is based on number of hours, classes, etc.  The “full time equivalent” (“FTE”) may vary for each position with an ERB employer and it also may vary between ERB employers.  Before accepting a position under the RTW Exception, it is each retiree’s obligation to ask the ERB employer what the FTE for the job is and to determine whether accepting the position would result in a violation of the RTW Exception limits.

 

Q: I have gone back to work under the RTW Exception and now want to apply for the Return to Work Program. Can I do this?

 

A: Yes. You must, however, have completed the 12 consecutive month layout at some point. If you have completed the 12 consecutive month layout and are now working as a contractor or under the RTW Exception, you may apply for the RTW Program. When your application is approved, you may then move to RTW Program status which would allow you to work more than 0.25 FTE without any restrictions on the income that you can earn from an ERB employer.  Please see the Questions and Answers above and below regarding the effects of exceeding the earnings and FTE limits of the RTW Exception on persons who retired from the Defined Benefit Plan and from the ARP.

 

Note: If you have not completed a 12 consecutive month layout, you will have to complete the layout between the last day you worked for an ERB employer under the 0.25 FTE option and the date you would begin working for an ERB employer under the RTW Program.

 

Q:  I retired before January 1, 2001.  After I retired, I decided to suspend my retirement, take my old job back and earn more service credit to increase my retirement.  Now I’ve retired again.  Is there is a special provision in the Return to Work Program that applies to retirees in my position?

 

A: Yes.  Persons who retired on or before January 1, 2001, who subsequently removed themselves from retirement so that they could work and earn more service credit (a/k/a “suspended retirement”), and then “re-retired,” must complete an additional 90 day layout after the re-retirement to qualify for the RTW Program.  This 90 day layout may not include any part of a summer or other scheduled break or vacation period. In addition, a 12 month layout after the initial retirement is also required. This 12 month layout can occur after the initial retirement or after the re-retirement.  This only applies to persons who first retired before January 1, 2001.  As discussed below, the requirements regarding the number of layouts for persons who retire after January 1, 2001 and re-retire after January 1, 2001 are different.

 

Q: I retired after January 1, 2001, did not work for 18 months, and then suspended my retirement to earn more service credit and increase my retirement.  I’m thinking about retiring again – or “re-retiring.”  What will I have to do to qualify for the RTW Program after I re-retire?

 

A.  The RTW requirements for persons who retired after January 1, 2001, then suspended retirement to earn more service credit are different from the requirements of retirees who simply retired after January 1, 2001.  A person who first retired after January 1, 2001 must complete a 12 month layout each time he or she retires – or re-retires – to be eligible for the RTW program.  Even if you laid out 12 months or longer after retiring the first time, if you suspend retirement to earn more service credit, you must complete a new 12 month layout after re-retiring to be eligible for the RTW Program.  For example, if you retired June 30, 2002, laid out until January 1, 2004 (18 months), then suspended retirement and worked until December 31, 2012 to earn more service credit, and re-retired, you must layout another 12 months or until January 1, 2014 to be eligible for the RTW program.

 

Q: Do the RTW Program and the RTW Exception apply to ARP Participants?

 

A: Yes. All ARP participants retiring from the ARP who wish to work under the RTW Program must complete a RTW application and 12 month layout.  In addition, as with retirees from the Defined Benefit Plan, retirees from the ARP may work under the RTW Exception without satisfying the RTW Program requirements, but they are subject to the same earnings and FTE limits as persons who retired from the Defined Benefit Plan.

 

Q: What happens if an ARP Participant exceeds the RTW Exception limits?

 

A:  The ARP Participant will be moved into RTW Program status and be required to make non-refundable contributions to the Educational Retirement Fund. Pursuant to federal law, the participant’s defined contribution benefit will not be suspended. The Participant will not earn service credit in the Defined Benefit Plan or be eligible to retire from the Defined Benefit Plan.

 

Q: When does the Return to Work Program end?

 

A: In 2009, the Legislature extended the “sunset” date for the Return to Work Program to January 1, 2022.

 

Should you have further questions about the RTW Program, the RTW Exception, or other work after retiring, please contact the ERB at 505-827-8030 in Santa Fe or toll free 866-691-2345.  RTW applications and the Executive Director’s Policy are available at the Download Forms link.

 

For more information please see the ERB Member Handbook or email ERB-memberhelp@state.nm.us.