Working after Retirement

ERB retirees who work for an ERB employer after retirement are subject to the provisions of the Educational Retirement Act and the ERB rules addressing this area. An ERB retiree who does not satisfy those requirements will be required to suspend retirement benefits. A retiree whosuspends benefits will earn additional service credit and may have a higher average annual salary for calculation of benefits upon re-retirement.


ERB retirees who resume employment for an ERB employer after retirement can apply to the Return to Work Program (the “RTW Program”) and continue to receive retirement benefits without any earnings limitation. Alternatively, ERB retirees may work for an ERB employer under the Return to Work Exception (the “RTW Exception”) and earn the greater of $15,000 or 25% of the salary for the full time equivalent (FTE) of the position in which the retiree is working. Retirees working under the RTW Exception can continue to receive retirement benefits so long as they do not exceed the earnings limits. The RTW Exception is discussed further
in the sub-section “Greater of .25 FTE or $15,000 RTW Exception.”


ERB retirees who return to work for a non-ERB employer after retirement will not be subject to the ERB requirements governing working for an ERB employer after retirement and their benefits will therefore not be affected.

Return to Work Program
The Return to Work (RTW) Program allows ERB retirees to go back to work for an ERB employer without having to suspend retirement benefits if they satisfy the requirements. (The RTW Program is separate from the Greater of 0.25 FTE or $15,000 RTW Exception discussed below.) The retiree must complete a Return to Work Application and submit it to ERB for approval before beginning work for an ERB employer again. The application can be found on the ERB website. Once in the RTW Program,
retirees can choose to work full or part-time with no restrictions on the income they earn.


Retirees working under the RTW Program must pay nonrefundable contributions to ERB equal to the contributions paid by non-retired members. Their employers also pay employer contributions. Members who retired after January 1, 2001, must complete a twelve consecutive month break in service, or layout. The twelve consecutive month period can occur any time after retirement; it does not have to be immediately prior to applying for the RTW Program. During the layout, the member cannot work for or render any service to an ERB employer. “Rendering service” includes any work, whether full or part-time, substitute teaching, voluntarily performing duties that would otherwise be, or have in the past been, performed by a paid employee or independent contractor, or performing duties for an ERB employer as an independent contractor or as an employee of an independent contractor. An ERB
employer includes any entity incorporated, formed or otherwise organized by, or subject to the control of an ERB employer, whether or not the entity is created for profit or nonprofit purposes. If you initially retired after January 1, 2001, and later suspended
retirement to earn more service credit, you must complete the twelve consecutive month layout each time you re-retire to be eligible for the RTW Program.


The only exception to the break in service or layout requirement is formembers who retired before January 1, 2001, who have not suspended their benefits. If you are in that category, you do not need to fulfill the twelve consecutive month layout period. However, if you retired before January 1, 2001, then subsequently suspended your retirement to earn additional service credit, and then re-retired, you must complete a 90-day layout before qualifying for the RTW Program in addition to the required twelve month layout for the exception.


During the twelve consecutive month layout period, you may work for non- ERB employers, including employers covered by the Public Employees Retirement Association (PERA) unless you are a licensed educator working in a position that requires such a license for a New Mexico agency that has an education program (i.e., Department of Corrections, Public Education Department, Department of Health, Division of Vocational Rehabilitation and Educational Retirement Board).


If you are working for an ERB employer as a contractor or under the Greater than 0.25 FTE or $15,000 RTW Exception, you must complete a twelve consecutive month layout before you may apply for the RTW Program.


Greater of 0.25 FTE or $15,000 RTW Exception
You may work for an ERB employer after retirement without qualifying or applying for the RTW Program, but your earnings are limited. Under the Greater of 0.25 FTE or $15,000 RTW Exception, you may earn the greater of $15,000 per fiscal year or an amount equal to 25% of the salary for the full-time equivalency (FTE) of the position in which you are employed. FTE refers to the number of hours worked that add up to a full time employee. The definition of FTE varies by position. ERB employers determine what the FTE is for a particular position and what 25% of FTE is for that position. The salary for the Greater of 0.25 FTE or $15,000
RTW Exception is calculated for a July 1 through June 30 fiscal year, and is based on the full time compensation for the position you work after retirement, not on your salary before retirement.


If you work for more than one ERB employer, you are obligated to notify each ERB employer about your ERB employer jobs. The salaries will be combined to determine whether you are in compliance with the Greater of 0.25 FTE or $15,000 RTW Exception.


If you earn more in a fiscal year than is allowed under the Greater of 0.25 FTE or $15,000 RTW Exception, you will lose your retirement status and forfeit retirement benefits. This change will be effective the first day of the month in which ERB employer earnings exceed, or are deemed to exceed, the greater of $15,000 or the salary for 0.25 FTE.

Retirees should keep track of their earnings and check with their ERB employer regarding the specific amount of hours, classes, etc. allowed for the 0.25 leg of the RTW Exception. It is your responsibility to keep track of your earnings to avoid exceeding the maximum allowed. ERB neither monitors retiree RTW earnings, nor notifies retirees that RTW earnings may exceed the .25 RTW limitations. Employees who exceed the earnings or .25 FTE workload limit will be returned to active status. An employee
returned to active status must pay nonrefundable contributions at the same rate as active members.


Consider applying for the RTW Program if you qualify, even if you only intend to work under the Greater of 0.25 FTE or $15,000 RTW Exception. Once your application is approved, if your earnings exceed the allowable limit, you will not lose your retirement status or forfeit retirement benefits. If you have not applied and been approved for the RTW Program, you run the risk of losing benefits if your earnings exceed the allowable limits.


Remember that time worked under the Greater of 0.25 FTE or $15,000 RTW Exception does not qualify as a break in service for the twelve consecutive month layout required for the RTW Program.