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11.7 Miscellaneous/Industrial-First Tier Members: First Tier A (2% at age 55), First Tier B (2% at age 60), and (PEPRA) First Tier (2% at age 62) Formulas/ Contribution Rate/Final Compensation Earnable

  1. First Tier Miscellaneous/Industrial retirement members first employed by the State prior to January 15, 2011 are subject to the First Tier A retirement formula.
  2. First Tier Miscellaneous/Industrial retirement members first employed by the State on or after January 15, 2011 and prior to January 1, 2013 and qualify for CalPERS membership are subject to the First Tier B Retirement Formulas.  The First Tier B Retirement Formula does not apply to:
    1. Former state employees who return to state employment on or after January 15, 2011.
    2. State employees hired prior to January 15, 2011 who were subject to the Alternate Retirement Program (ARP).
    3. State employees on approved leave of absence prior to January 15, 2011 who return to active employment on or after January 15, 2011.
    4. Persons who are already members or annuitants of the California Public Employees Retirement System as state employees prior to January 15, 2011.
    5. The above categories are subject to the First Tier A retirement formula.
  3. Employees who are brought into CalPERS membership for the first time on or after January 1, 2013 and who are not eligible for reciprocity with another California public employer as provided in Government Code Section 7522.02(c) shall be subject to the “PEPRA Retirement Formula.” As such, the PEPRA changes to retirement formulas and pensionable compensation caps apply only to new CalPERS members subject to PEPRA as defined under PEPRA.
  4. The table below lists the First Tier age/benefit factors for First Tier A, First Tier B, and PEPRA First Tier retirement formulas.
     

    Age at
    Retirement

    		 First Tier A Formula
    (2% at age 55)    		 First Tier B Formula
    (2% at age 60)    		 PEPRA Formula
    (2% at age 62)
    Employees hired prior to January 15, 2011 Employees first hired on and after January 15, 2011 and prior to January 1, 2013 Employees eligible for CalPERS Membership for the first time on and after January 1, 2013
    50 1.100 1.092 N/A
    51 1.280 1.156 N/A
    52 1.460 1.224 1.000
    53 1.640 1.296 1.100
    54 1.820 1.376 1.200
    55 2.000 1.460 1.300
    56 2.064 1.552 1.400
    57 2.126 1.650 1.500
    58 2.188 1.758 1.600
    59 2.250 1.874 1.700
    60 2.314 2.000 1.800
    61 2.376 2.134 1.900
    62 2.438 2.272 2.000
    63 2.500 2.418 2.100
    64 2.500 2.418 2.200
    65 2.500 2.418 2.300
    66 2.500 2.418 2.400
    67 2.500 2.418 2.500
  5. Employee Retirement Contribution
    1. As stated in Government Code Section 20682, effective May 16, 2011, miscellaneous and industrial members in the First Tier retirement or the Alternate Retirement Plan (ARP) subject to social security shall contribute eight percent (8%) of monthly compensation in excess of $513 for retirement.
    2. As stated in Government Code Section 20682, effective May 16, 2011, miscellaneous and industrial members in the First Tier retirement or the ARP not subject to social security shall contribute nine percent (9%) of monthly compensation in excess of $317 for retirement.
    3. As stated in Government Code Section 20683.2, industrial members shall pay an additional one percent (1%) employee retirement contribution to retirement.  Effective July 1, 2013, industrial members subject to social security shall contribute nine percent (9%) of pensionable compensation in excess of $513 to retirement.  Industrial members not subject to social security shall contribute ten percent (10%) of pensionable compensation in excess of $317 to retirement.
    4. On July 1, 2019, the employee contribution rates described in 11.7(E)(1), 11.7(E)(2), and 11.7(E)(3) for First Tier A, First Tier B, and PEPRA First Tier retirement formulas shall remain in effect unless CalPERS determines that (a) the total normal cost rate for the 2016-17 fiscal year has increased by 1 percent, and (b) 50 percent of that normal cost rate, rounded to the nearest quarter of 1 percent, is greater than the employee contribution rate described in 11.7(E)(1), 11.7(E)(2), or 11.7(E)(3), respectively.  If CalPERS determines (a) and (b) above have been met, the employee contribution rate for miscellaneous or industrial members shall be adjusted to 50 percent of the normal cost rate rounded to the nearest quarter of one percent.  The increase to the employee contribution shall not exceed 0.5 (five) percent.  After June 30, 2020, the employee contribution shall return to 11.7(E)1 (8%), 11.7(E)2 (9%), and 11.7(E)3 (9%) and (10%) respectively.  Upon receipt of the next General Salary Increase (GSI) provided for in Article 3.26 of this agreement, the Unit 9 employee contribution rate shall return to the level established by this Section for the 2019-20 fiscal year for a period of one year from the effective date of the GSI.
  6. Final CompensationFinal Compensation for an employee, who is employed by the State for the first time and becomes a member of CalPERS prior to January 15, 2011, is based on the highest average monthly pay rate during twelve (12) consecutive months of employment.

    Final Compensation for an employee, who is employed by the State for the first time and becomes a member of CalPERS on or after January 15, 2011, is based on the highest average monthly pay rate during thirty-six (36) consecutive months of employment.