“Superannuation” is the technical name for the most common type of retirement benefit: an allowance earned after a career of public service. Within this category, there are two types of allowances: a “regular” benefit and an enhanced, RetirementPlus benefit.

The average life expectancy at retirement is approximately 25-30 years. The best plan for future financial security involves having several sources of income rather than just one.

FAQs

When will I be eligible to receive a regular (“superannuation”) retirement allowance from the Massachusetts Teachers’ Retirement System?

Your eligibility to receive a regular retirement allowance is based on:

• your effective membership date in a Massachusetts public retirement system (which determines your membership tier ),
• the number of years of creditable service you have, and,
• depending on your membership date, your age

Specifically, depending on which Membership Tier you are in, you will be able to receive a retirement allowance as follows:

• Tier 1 (established membership BEFORE April 2, 2012): when you:
  • have 20 or more years of creditable service, regardless of your age, OR
  • are at least age 55 and you have 10 or more years of creditable service.
• Tier 2 (established membership ON OR AFTER April 2, 2012):
  • when you are at least age 60 and you have 10 or more years of creditable service.

NOTE: If your effective membership date is BEFORE January 1, 1978, you are eligible to retire upon reaching age 55. There is no minimum service requirement, nor do you have to be an active member in order to apply for retirement.

If you are participating in RetirementPlus, in order to be eligible to receive the enhanced RetirementPlus benefit, you must also have at least 30 years of creditable service, of which 20 years are membership service with the MTRS or Boston Retirement System as a teacher.

The Massachusetts Retirement Law (Massachusetts General Laws Chapter 32) regulates your retirement allowance and allows you to choose one of three benefit options. These options differ with regard to the amount paid and whether any benefits will be paid to someone else after your death.

How and when do I file for retirement?

In order to retire, you must file an application for retirement with the MTRS—notifying your school district of your intent to retire does not begin any paperwork with us. You may file your application up to four months before your retirement date. If your application is received within 60 days after your date of termination of service, your retirement can take effect on your termination date. If, however, you file more than 60 days after your date of termination of service, your benefits will not be retroactive to that date; the earliest they may then begin is 15 days after we receive your application.

For example, if you decide during summer vacation that you want to retire instead of returning to the classroom in the fall, the MTRS must receive your completed application on or before August 29 to use June 30 as your retirement date and have your benefits be retroactive to June 30. If the MTRS receives your application on August 30, your earliest retirement date would be September 14, and you would lose two and a half months’ worth of retirement benefits (from July 1 through September 14).

For a step-by-step guide to regular (“superannuation”) retirement—including basic information and an online benefit estimator—please see Apply for retirement.

Do I have to retire at the end of the school year?

No—you may choose any day of the year as your effective date of retirement. However, if you choose to retire at the end of a school year and your school year ends in June, your retirement date will take effect on June 30, a date set by MTRS regulation.

What is my retirement benefit based on?

Except for accidental disability, ordinary disability/veteran and termination retirement benefits, your retirement benefit is based on the following factors:

• Your age on your date of retirement: If your birthday is January 1, and you are retiring on June 30, your age factor will be based on your age as of your last birthday. We do not round up your age when determining an age factor. If your Membership Tier is:
  • Tier 1 (established membership BEFORE April 2, 2012), you will reach the maximum age factor at age 65.
  • Tier 2 (established membership ON OR AFTER April 2, 2012), you will reach the maximum age factor at age 67.
• Your years of creditable service: This is the total number of years of creditable service you have accrued in the MTRS.
• Your final salary average: 
  • For Tier 1 members, the average of either your highest three consecutive years’ salaries ,or your last three years’ salaries, whichever is greater.
  • For Tier 2 members, the average of either your highest five consecutive years’ salaries, or your last five years’ salaries, whichever is greater.

Under the Massachusetts Retirement Law (M.G.L. c. 32), you may choose to retire under one of three benefit options: Option A, B or C.

All applications for disability retirement must be reviewed by the members of the Board at one of their monthly meetings. Only the Board may grant disability retirement benefits.

If you should find yourself permanently disabled and unable to work for an extended period of time, you may be eligible to receive one of two types of disability retirement benefits:

• accidental disability benefits if your disability is work-related; or,
• ordinary disability benefits if your disability is non-work-related.

FAQs

How do I apply for a disability retirement allowance?

To apply, you will need to complete our Disability Retirement Application , which includes a section that must be completed by your physician. It also contains various release forms so that we may gather documentation from doctors, medical institutions and insurers. However, because there are many issues involved in the disability retirement application process, you may want to have a conversation with the Disability Case Manager in our legal unit before filing the application to be sure that this is an appropriate option for your particular situation.

What happens after I submit my application?

• Upon receipt of your completed application, we will request the appropriate medical, hospital and insurance records and request that your school department complete our Disability Applicant’s Employer’s Statement regarding the circumstances of your disability. The Employer’s Statement is a questionnaire regarding the nature of the event, injury or accident which led to your present state of disability as well as your capacity for employment.
• Upon receipt of the documentation from your medical providers, we will review all of the materials and, in most cases, we will ask the Public Employee Retirement Administration Commission (PERAC ) to set up a three-member regional medical panel to examine you.
• After being appointed by PERAC, the regional medical panel will meet to conduct its examination of you.
• After completing its examination, the regional medical panel will report its findings and recommendation to PERAC, who will forward the report to the Board.
• After receipt of the report, we will notify you of the panel’s findings and provide you with a copy of all of the documents completed by the regional medical panel. Your application is then ready to be considered by the full Board.
• When a Board hearing is scheduled, we will notify you. If your application is approved by the Board, it will be transmitted to PERAC for final action; PERAC must act on your application within 30 days of its receipt. If your application is denied by the Board, we will advise you of your right to appeal the decision.

Do I have to appear at the Board hearing?

All disability applicants are welcome to attend the Board meeting and will be heard by the Board, though for many ODR cases, applicants’ attendance is not necessary. An applicant may choose to be represented by an attorney before the Board.

Am I required to have a medical panel examination?

Unless the Board denies your application as a matter of law prior to the convening of a medical panel, applicants must attend a medical panel examination. Pursuant to Chapter 32 of the Massachusetts General Laws, every member of a state contributory retirement system who applies for disability benefits must be examined by a regional medical panel. In very unusual cases where the member’s condition prevents travel, the panel will review documents only in lieu of an examination.

Will I be re-examined on a regular basis to see if I am capable of returning to work?

PERAC may conduct a re-examination of you once per year during the first two-year period after the effective date of your retirement, and then once a year every three years after that.

Does PERAC have the authority to suspend or modify my retirement allowance?

Yes. Please see M.G.L. c. 32, S. 8 and PERAC’s website.

Please note that, because the disability benefit formulas vary by type and, for ordinary disability cases, whether you are a veteran or non-veteran and whether you are participating in RetirementPlus, they are not shown here.

Three notes to recent and soon-to-be retirees

1. While you are an active educator, your health insurance premiums may have been withheld on a pre-tax basis. Please note, however, that the IRS requires that retirees’ insurance premiums be withheld on an after-tax basis.
2. Regardless of the group insurance program you may be offered after your retirement, you should contact your local insurance coordinator approximately three months prior to your effective date of retirement in order to obtain the necessary forms for coverage. Likewise, please review our information on Medicare.
3. An important notice for charter school employees and inactive members: Be aware that school districts have different rules for providing insurance coverage to active members and retired members, and your district may or may not provide you with insurance benefits in retirement. Accordingly, if you are either an employee of a charter school, or you are not employed by a school district, as soon as you start thinking about retiring, investigate your eligibility for retiree health coverage, as your districts’ rules may affect your retirement decisions.

About your health insurance in retirement

Health insurance for retired members of the MTRS is not provided by the MTRS, but, rather, is a local contractual benefit. Most school districts offer continued health insurance to their retirees and either:

• participate in the Retired Municipal Teachers’ (RMT) Program (see list below) or
• offer their own group insurance plan.

How this insurance will be administered depends upon which school system you are retiring from. Since health insurance coverage is a very important issue for you as you consider your retirement, you may want to investigate your options several years prior to your actual retirement.

For more information on your health insurance coverage options in retirement, if your district:

• Participates in the Retired Municipal Teachers (RMT) Program (see list, below), contact the Group Insurance Commission, or 617-727-2310.
• Is not listed as participating in the RMT Program, below, please contact your local insurance coordinator. (Note: Your city or town may participate in the “GIC Municipality Program.” If so, you should still contact your local insurance coordinator as he or she will administer your coverage, which is provided through the GIC.)

Districts participating in the Retired Municipal Teachers’ (RMT) Program

(as of March 23, 2018)

For questions about your coverage or premium, contact the Group Insurance Commission at 617-727-2310.

*Leaving RMT as of July 1, 2018

As you probably know, Massachusetts is one of a handful of “non-Social Security” states. This means that you, as a member of a contributory retirement system, pay into our system instead of Social Security; you do not earn any Social Security “credits” or “quarters” for your MTRS contributions or service. However, you may have earned Social Security credits through other employment. If you are eligible for Social Security benefits, you may be subject to one of two Social Security “double-dipping” laws: the Windfall Elimination Provision and the Government Pension Offset.

IMPORTANT NOTE: All retirees should contact the Social Security Administration to determine their eligibility for social security benefits three months before retirement or three months before age 65, whichever comes first.

FAQs

*Unless otherwise noted, all COLAs are effective on a fiscal year basis (e.g., the COLA listed as “2018,” above, is effective for the fiscal year beginning July 1, 2018).

FAQs

Why does the MTRS do this?

The Massachusetts retirement law requires that the MTRS perform, at least once every two years, a verification of all retirees and beneficiaries who receive a monthly benefit (840 CMR 15.01 ).

While in past years we performed this process on an annual basis, in calendar year 2010, the Board suspended its annual verification policy in order to reduce costs. We now perform this process once every two years, as allowed by PERAC regulations (840 CMR 15.01 ). As always, we will continue to be vigilant and use available resources to help achieve the purpose of the benefit verification process.

What is the purpose?

Our job is to pay the appropriate retirement or survivor allowance to the unique person who earned the particular benefit. In some cases, we have discovered that, after a retiree has died, a family member has continued to collect benefits—even though that family member is not eligible for any survivor benefits. In order to ensure that benefits are still being paid to the correct individuals, by law, we must confirm that the intended recipients are still alive and, therefore, eligible to receive benefits.

This is a very serious process, intended to prevent the fraudulent collection of pension benefits by ineligible parties.

If I receive a form in the mail, do I HAVE to complete and return it?

Yes. If you receive a form from us, you most definitely have to complete and return it. If you do not return your completed form by the due date indicated on the form, your benefit may be interrupted or discontinued.

Why does my signature have to be notarized?

Because the very serious purpose of this process is to ensure that we are paying benefits to the individuals who are entitled to them—in other words, that “you,” the person who earned the benefit, are “you,” the person who is receiving the benefit—it is necessary that your signature be witnessed by a notary public: a public servant who is legally responsible for verifying your identification.

Can I fax my Benefit Verification Form to the MTRS?

No—for several reasons: we need your original, notarized signature on file; the returned Benefit Verification Forms are being processed by a third-party vendor; and, faxes introduce the possibility of erroneous duplication.

Regarding the “Return by” date—does my Benefit Verification Form have to be postmarked or received by that date?

Received, so we encourage you not to wait until the last minute to return your form. To ensure proper delivery of your form to our vendor, please use the pre-addressed reply envelope that we provide.

I misplaced the pre-addressed reply envelope. To what address must I return my form?

Please return your form to:

Massachusetts Teachers’ Retirement System
500 Rutherford Avenue, Suite 210
Charlestown, MA  02129-1628

Will the MTRS acknowledge receipt of my Benefit Verification Form?

Yes. Within four to six weeks after we have received and processed your completed form in our database, we will send you a postcard acknowledging the receipt of your form. We suggest that you make a photocopy of your form before you return it.

Where can I find a notary public? How much will it cost to have my form notarized?

You can usually find someone who is a notary in businesses and offices that regularly handle legal documents, such as in:

• city and town clerks’ offices,
• local banks, real estate offices and attorneys’ offices, and
• travel agencies.

In Massachusetts, notaries may charge no more than $1.25 for noting and recording a document (M.G.L. c. 262, s. 41). Notaries are public servants, expected to perform a public service at a reasonable cost. If you have any questions about Massachusetts notaries, please go to Find a Notary Public or, contact:

Secretary of the Commonwealth, Public Records Division
One Ashburton Place, Room 1719
Boston, MA 02108
Phone: 617-727-2836

If you are not in Massachusetts at the time that you are completing your form, please have your signature notarized by an appropriate official in the state (or country) where you are located. (In other words, your form does not need to be notarized by a Massachusetts notary.)

I am caring for a benefit recipient who is housebound and unable to obtain a notary’s signature. What should we do?

If the benefit recipient is housebound and is unable to obtain a notary’s signature, please:

• review and complete Sections 1 and 2 of the form with the benefit recipient,
• have the benefit recipient sign Section 3,
• obtain a letter from the benefit recipient’s physician stating that he or she is under the doctor’s care and is housebound, and
• return the Benefit Verification Form and physician’s letter in the reply envelope enclosed with the form.

The benefit recipient is in a nursing home and is unable to obtain a notary’s signature. What should we do?

If the benefit recipient is in a nursing home and is unable to obtain a notary’s signature, please:

• review and complete Sections 1 and 2 of the form with the benefit recipient,
• have the benefit recipient sign Section 3,
• obtain a letter, signed by the director and one other administrator of the nursing home, stating that the benefit recipient is in a nursing home, and
• return the Benefit Verification Form and nursing home’s letter in the reply envelope enclosed with the form.

The benefit recipient is deceased, or under guardianship or conservatorship or has assigned power of attorney to another person. What should we do?

If the person to whom the Benefit Verification Form is addressed is deceased, or under guardianship or conservatorship or has assigned power of attorney to another person, a survivor or the appropriate responsible person needs to complete and return the form. Please note:

• You do not need to complete anything on the front of the form.
• Please review the instructions in the shaded box on the back of the form, then check one of the two boxes to indicate the status of the Benefit Recipient
• If the Benefit Recipient is deceased, please call our Contact Center at 617-679-6890 as soon as possible.
• As noted, please attach the requested documentation, sign and date the form, and then submit this information in the envelope provided.

Can I access my Benefit Verification form online?

No—you will need to complete and return the original blue-and-yellow form that we send you. Your Benefit Verification form is not available online in order to prevent duplicate returns.

Reminder to members: As described below, there are time and earnings restrictions on re-employment with a Massachusetts public employer. However, there are no restrictions on employment in the private sector, public employment in another state or employment with the federal government.

Reference: PERAC memos, including an interactive earnings calculator

• Enforcement of Post-Retirement Limits on Retirees of a Public Retirement System who Take Employment with any Public Entity in Massachusetts (Memo 30; November 1, 2013)
• Frequently asked questions 
• Post Retirement Earnings Calculator 
• Instructions for Post-Retirement Earnings Worksheet 
• Restrictions on post-retirement employment in Massachusetts  (Memo 24; July 2, 2008)
• Post-retirement earnings limitations in G.L. c. 32, § 91  (Memo 20; May 19, 2004)
• Post-retirement earnings limitations in G.L. c. 32, § 91  (Memo 3; January 12, 2004)

Overview

Pursuant to Massachusetts General Laws c. 32, § 91, there are limitations on the amount of time that a rehired retiree may work and the amount of money that he or she may earn.

However, pursuant to M.G.L. c. 32, § 91(e), the earnings limitations on re-employment of retirees in Massachusetts public schools are eased in the event of a “critical shortage” in a position as determined by the Department of Elementary and Secondary Education (ESE). The ESE has adopted regulation 603 CMR 7.14(13)(b), allowing the Commissioner of Elementary and Secondary Education to deem that a district has a “critical shortage” upon the request of a superintendent and demonstration that the district has made a good-faith effort to hire non-retirees and has been unable to find them. The “critical shortage” application process is similar to that for requesting a waiver for certification. (School districts wishing to take advantage of the “critical shortage” provision of M.G.L. c. 32, § 91(e) are advised to consult with the Department of Elementary and Secondary Education for guidance on the certification requirements for re-employed retirees.)

In brief:

FAQs

The school district that wishes to rehire a retiree to work beyond his or her post-retirement time and earnings limitations has applied for a critical shortage waiver with the Department of Elementary and Secondary Education (ESE). How will the rehired retiree know whether the critical shortage waiver is approved?

Once the ESE completes their review of the critical shortage waiver application, they will send written notice of their decision to the school district and mail a copy of the decision to you. Please be advised that you should not assume that you are working under a critical shortage waiver unless you have received a copy of the approval from the ESE.

How does the MTRS calculate the amount that I can earn?

Until you have been retired for at least one full calendar year (meaning one full January-through-December year), the amount that you can earn is equal to the difference between the annual amount currently being paid for the position from which you retired, and your annual pension. After you have been retired for at least one full calendar year, this limit is increased by $15,000.

For example: Trudy Teacher retires on June 30, 2019, with an annual retirement allowance of $48,000. The position from which Trudy retires, based on her step and education level, will pay $65,000 per year in the fall of 2019, and will remain at that amount for the next several years. She will return to teaching on September 1, 2019, and continue to work for the next several years (without exceeding the limit of 960 hours per calendar year). Trudy’s earnings limitations for the next few years are as follows:

For the last four months of 2019 (September 1 through December 31, 2019), Trudy can earn $17,000

Current annual salary for position from which Trudy retired*	$65,000
– Trudy’s annual retirement allowance	– $48,000
Amount of Trudy’s allowable earnings** for remainder of 2019	$17,000

* “Salary” means, essentially, the type of payments that constitute the ‘regular compensation’ used in the calculation of your retirement allowance, including but not limited to your contractual salary, longevity, and eligible extra duty stipends, including stipends for athletic coaching.
** “Earnings” include compensation in any form including annuity/insurance premiums and other fringe benefits.

For all of calendar year 2020 (January 1 through December 31, 2020), Trudy can still earn a total of $17,000

Current annual salary for position from which Trudy retired*	$65,000
– Trudy’s annual retirement allowance***	– $48,000
Amount of Trudy’s allowable earnings** for calendar year 2020	$17,000

Beginning January 1, 2021, after she has been retired for one full calendar year, Trudy can now earn an additional $15,000 for calendar year 2021 and every calendar year thereafter

Current annual salary for position from which Trudy retired*	$65,000
– Trudy’s annual retirement allowance***	–  $48,000
Standard earnings limitation for calendar year 2021	$17,000
+ $15,000 (per pension reform legislation of 2011)	+ $15,000
Amount of Trudy’s allowable earnings** for 2021	$32,000

*** Because cost-of-living adjustments must be granted by the Massachusetts Legislature on an annual basis, we have not included any COLA amounts in Trudy’s annual retirement allowance figures in these examples. If, however, the Legislature approves a 3% COLA for fiscal years 2021 and 2022, and the COLA base remains $13,000, then Trudy’s annual retirement allowance for calendar year 2020 would be $48,195 (an additional $32.50 per month for the six months of July through December, for a total increase of $195), and her allowable earnings for calendar year 2020 would decrease by $195, to $16,805. Likewise, for calendar year 2021, her annual retirement allowance would increase to $48,585 (an additional $32.50 per month for January through June, and an additional $65.00 per month for July through December, for a total increase of $585), and her allowable earnings for calendar year 2021 would decrease by $585, to $31,415.

For an interactive worksheet that both the employer and the rehired retiree can use to determine the earning limitations, please see the Public Employee Retirement Administration Commission’s Post Retirement Earnings Calculator .

I am a disability retiree. Am I subject to any additional post-retirement earnings limitations?

Yes—whereas non-disability retirees are subject to limitations on their post-retirement Massachusetts public sector earnings only, disability retirees are subject to a limit on the total amount of their post-employment earnings, from both public and private sectors.

Pursuant to M.G.L. c. 91A, a disability retiree’s annual post-retirement earnings—from both the private and public sectors—when added to his or her disability retirement allowance, cannot exceed the amount of salary that would have been payable to the retiree had he or she remained in service in the grade held at the time of retirement, plus $15,000. If this earnings limitation is exceeded, the retiree’s allowance will be withheld until the overpayment is recovered by the MTRS.

“Salary” means, essentially, the type of payments that constitute the ‘regular compensation’ used in the calculation of your retirement allowance, including but not limited to your contractual salary, longevity, and eligible extra duty stipends, including stipends for athletic coaching. “Earnings” include compensation in any form, including annuity/insurance premiums and other fringe benefits, and implies some labor, management or supervision in production of the income and not income derived merely from ownership of property.

It is the retiree’s responsibility to advise the person responsible for paying his or her compensation that he or she is a public retiree and, as a result, his or her post-retirement earnings in the public sector are limited.

How is the “salary being paid” for the position from which the rehired retiree retired determined?

If, in the position from which the retiree retired, he or she:

• was covered by a collective bargaining agreement in the position from which you retired, the “salary being paid” is the current annual contract rate for the retiree’s step and education level on the salary schedule.
• was not covered by a collective bargaining agreement (e.g., the retiree was an administrator or other educator covered by an individual contract), then the “salary being paid” is your last annual salary prior to retirement, plus an inflation factor equal to the Consumer Price Index (CPI-W) as certified by the Commissioner of Social Security, unless the retiree can provide sufficient evidence for the MTRS to reliably determine what you would have earned in a year after his or her retirement. An example of sufficient evidence would be a written, contemporaneous policy showing that the class of employees of which you would have been a member had he or she not retired, would all receive the same raise in a given year.

For example, if an administrator retired in 2018 with a final salary of $125,000 and the district wished to rehire her in 2019, for the purposes of determining the “salary being paid” for that position, the MTRS would apply the following formula:

Salary at retirement + inflation factor = “salary being paid”

$125,000 + 2.8% (the January 2019 COLA factor) = $128,500

NOTE: “Salary” means, essentially, the type of payments that constitute the ‘regular compensation’ used in the calculation of your retirement allowance, including but not limited to your contractual salary, longevity, and eligible extra duty stipends, including stipends for athletic coaching.

For part-time positions…

If you worked part-time in your last year of employment, the “salary being paid” for the position from which you retired is, likewise, your former part-time equivalent of the current full-time salary. For example: Mary Music works on a 50%-of-full-time basis and retires June 30, 2019. For the 2018-19 school year, she earned $37,000, or 50% of the full-time salary of $74,000.

	School year 2019-20 full-time salary for Ms. Music’s former position		$76,000
x	Ms. Music’s former part-time basis (50%)	x	50%
	“Salary being paid” for Ms. Music’s position in 2019-20 on a 50% basis		$38,000
–	Ms. Music’s annual gross pension	–	$29,250
	Ms. Music’s allowable earnings for the rest of calendar year 2019		$8,750
	Beginning January 1, 2021, Ms. Music can earn an additional $15,000 per calendar year.

Ms. Music’s full-time equivalent salary is used to calculate her final salary average; this increase the annual benefit she will collect the rest of her life, but limits or eliminates her ability to work in the public sector in retirement.

If the amount earned or the number of hours worked will exceed the limitations, what are my options?

In either case, the retiree has two options. If the retiree wishes to work in a position that will exceed either the time or the earnings limitation, and he or she has not been approved for a critical shortage waiver, he or she may:

a) Request a temporary cessation of pension payments by notifying the MTRS in writing to waive his or her retirement allowance for the period of employment. A retiree who has waived his or her retirement benefits is not subject to the time and earnings limitations and is not required to make contributions to the pension system. Stopping a retiree’s pension payments can affect the administration of his or her health insurance benefit, however, so it is a good idea for the retiree to discuss the impact of waiving the retirement benefit with his or her local insurance coordinator before making this decision.

Upon completion of the employment, the retiree may resume receiving his or her retirement allowance at the same level of benefits he or she had before waiving the allowance, plus any cost-of-living adjustments passed by the Massachusetts Legislature. (In other words, the retiree cannot recoup his or her retirement benefits for the period during which he or she waived them.)

b) Return to active membership in the MTRS and, in effect, “unretire,” if he or she agrees to certain terms and conditions. Pursuant to M.G.L. c. 32, § 105, in order to “unretire,” the retiree must pay back to the retirement system the total pension benefits received while retired, plus interest at the buy-back rate (currently, 3.675%). Moreover, the retiree must be employed in a full-time position subject to membership in the MTRS, for at least five full years from his reinstatement date in order to accrue additional retirement benefits. For more information, please see:

• Reinstatement to Service under G.L. c. 32 § 105 (July 14, 2011, PERAC memo 22 of 2011)
• Application for Reinstatement to Service   (pdf, 3 pages)

Is it true that retired teachers can “unretire”?

Yes, a member may be reinstated, provided he or she agrees to certain terms and conditions. Please see Question 5(b) directly above.

Can a retired teacher or administrator who waives retirement benefits and then accepts a full-time, paid position, later have his or her retirement allowance reinstated for 960 hours during any calendar year?

No. The law does not permit retirees who waive their retirement benefits and then accept public employment to supplement their incomes by the device of reinstating their retirement allowances for the 960-hour period during each calendar year. Opinion of the Attorney General, February 2, 1979.

Whose responsibility is it to keep track of the number of hours worked and money earned by the retirees?

It is the responsibility of the rehired retiree to provide his or her employer and the treasurer of the city or town (or the source responsible for paying the retiree) with a certification of the length of time worked and the amount of income earned in a given calendar year. If either the period worked or the income earned exceeds the allowable amount, the rehired retiree can no longer be employed and the excess earnings must be returned to the appropriate treasurer or entity responsible for paying the retiree. In the case of excess or improper retirement payments, the MTRS has the authority either to require repayment or to offset the amount received against future retirement payments.

If a teacher or administrator is rehired as a “consultant,” do the restrictions on post-retirement employment still apply?

Yes. The restrictions set forth above apply to both employees and non-employees; except for services performed for the general court as a non-employee, the law makes no distinction between employees and non-employees. Accordingly, the restrictions on hours and earnings apply if a teacher or administrator is receiving a retirement allowance and is being paid as a “consultant,” independent contractor, or someone whose regular duties require their time to be devoted to the service of the Commonwealth.

Are “leased employees” subject to these restrictions?

Yes. M.G.L. c. 32, § 91(a) prohibits all retirees from “render[ing] service” to any public employer, including school districts. Section 91(b) provides a general exception to this prohibition, allowing post-retirement employment for up to 960 hours in any calendar year, and limiting annual earnings to the difference between the retiree’s retirement allowance and the salary being paid for the position from which he/she retired. The Massachusetts Teachers’ Retirement System (MTRS) interprets “render[ing] service” to include work under an employee leasing arrangement, and thus such arrangements are subject to the restrictions of section 91.

What is an employee leasing arrangement?

An employee leasing arrangement is one where one company (the “Leasing Company”) loans or hires out its employee to another (the “Client Company”). The “leased” employee is paid by the Leasing Company and may report occasionally to the Leasing Company. While working for the Client Company, however, the employee and his/her work are directed and controlled by the Client Company and the employee typically uses the Client Company’s work space and equipment to accomplish his/her work. A common example is a “temp” agency that supplies temporary workers. Since the law has often regarded “leased” employees as employed by both the Leasing Company and Client Company, it is clear that a “leased” employee “renders service” to the Client Company.

In the education context, some companies supply interim school administrators under “leasing” arrangements, and these administrators are directed in their day-to-day activities by the school district. Of course, superintendents, assistant superintendents and principals are by law appointed, employed and directed by their respective superiors (ultimately, the school committee). General Laws c. 71, §§ 59 and 59B. Thus, the System regards “leased” employees in such positions to be “render[ing] service” to the district and thus subject to the limitations of section 91(b).

Will I be subject to Social Security deductions? MTRS retirement deductions?

No, you will not be subject to either Social Security or MTRS contribution deductions. If a retired teacher or administrator returns to work in a Massachusetts public school, he or she is considered a “rehired annuitant” by the Internal Revenue Service, and therefore exempt from mandatory Social Security coverage. For more information, see the IRS web page on Rehired Annuitants as well as the Social Security Administration’s web page on Rehired Annuitants .

Where can educators get information on maintaining their teaching certification?

See the Department of Elementary and Secondary Education’s website for information on renewing your license.

Regular compensation

What you earn as “regular compensation” is important both for us and for you:

• For you, because it is the amount of your earnings upon which you pay retirement contributions.
• For both you and us, because only those payments that meet the definition of “regular compensation” may be used in the determination of your final salary average, which is a factor in the calculation of your retirement benefit.

It is in your best interest to understand what earnings are included and excluded as regular compensation so that, when it is time for you to retire, you don’t have any misunderstanding or false expectations as to what will be included in your final salary average.

“Regular compensation” is a complex legal term whose precise definition is often the subject of court decisions. Below are some of the most commonly asked-about payments as far as what is generally included in, or excluded from, regular compensation.

What is generally INCLUDED as regular compensation:

• Your annual base salary, which is usually set forth in your collective bargaining agreement or administrator’s contract
• Salary payable for services rendered in connection with a school lunch program
• Salary payable for services in connection with a program for physical education instruction and athletic contests such as intramural sports
• Athletic coaching
• Annual stipends for additional services set forth in your collective bargaining agreement (e.g., yearbook advisor, class advisor, department head)
• Cost-of-living adjustments that become part of base pay
• Payments for length of service (“longevity”)
• Educational step increases according to salary schedule set forth in collective bargaining agreement, which become part of base pay

What is generally EXCLUDED as regular compensation:

• Retirement incentives
• Temporary salary augmentations (i.e., ”ELBO” payments)
• Amounts paid for unused sick leave
• Payment for unused vacation
• Overtime
• Bonuses
• Special projects
• Summer school
• Reimbursement for travel or other expenses
• Travel or housing allowances
• Amounts paid on an hourly basis for additional services
• Amounts paid in addition to salary for professional development or education assistance (e.g., recertification workshops) that do not become part of your annual base salary
• Any payment made as a result of the employer’s knowledge of your retirement
• Workers’ compensation wages
• Effective July 1, 2012, all fringe benefits, including employer paid individual life and disability insurance premiums, annuities, and housing allowances. [Note: fringe benefits that were in the member’s contract in effect on May 1, 2009 may be grandfathered as regular compensation through the expiration of the term of that contract, or June 30, 2012, whichever occurs first.]

Note: Employees with membership dates after 12/31/1995 are subject to pensionable earnings limits

There are federal and state limits on the amount of pensionable earnings (“regular compensation”) that can be used in computing benefits for active members of public retirement systems with effective membership dates after 12/31/1995. Specifically, for members with effective membership dates:

• After 12/31/1995, the pensionable earnings limit for calendar year 2019 is $280,000 (pursuant to Internal Revenue Code § 401(a)(17); see 2019 PERAC Memo 3).
• After 1/1/2011, the pensionable earnings limit for calendar year 2019 is $179,200 (pursuant to Section 23 of Chapter 131 of the Acts of 2010; see 2019 PERAC Memo 4). For the purposes of imposing a pension “cap,” the maximum amount of regular compensation that may be used in the determination of the final average salary was set at 64% of the annual limit pursuant to the Internal Revenue Code, 26 U.S.C. 401(a)(17). In 2019, the 401(a)(17) limit is $280,000. Accordingly, the maximum amount of regular compensation for a member whose most recent date of membership is after 1/1/2011 is $179,200 in 2019 (64% of $280,000).

RetirementPlus

You may receive benefits under the “regular” or “RetirementPlus” formulas, depending on which plan you participate in. If you are participating in RetirementPlus, understand how it works and what it means for your retirement benefit.

Codified in M.G.L. c. 32, s. 5(4), RetirementPlus increases retirement benefits for eligible and participating members who have completed 30 years of service (at least 20 of which are membership service with the MTRS or the Boston Retirement System as a teacher), and subject to the statutory maximum of 80 percent, as follows:

• for members with effective membership dates before April 2, 2012, an additional 2 percent for each full year of creditable service in excess of 24 years (e.g., at 30 years of creditable service, an additional 12%, or 6 years x 2%).
• for members with effective membership dates on or after April 2, 2012, an additional 2 percent for each full year of creditable service in excess of 23 years (e.g., at 30 years of service, an additional 14%, or 7 years x 2%).

The contribution rate for RetirementPlus participants is a flat 11%.

In February 2001, then-current members of the MTRS were mailed an Election Form and given until June 30, 2001 to affirmatively elect to participate in RetirementPlus. On or after July 1, 2001:

• Members who transfer into the MTRS from another Massachusetts contributory retirement system have 180 days in which to elect to participate in RetirementPlus; if they do not respond, they are not enrolled in RetirementPlus.
• New members are automatically subject to RetirementPlus.

For tables showing the percentages of salary average allowed by age, years of service and formula (regular or RetirementPlus), please see “Retirement percentage” charts.

FAQs

I am participating in RetirementPlus. What does this mean for my retirement benefit?

If you are participating in RetirementPlus—because you either elected to participate or you became a member of the MTRS on or after July 1, 2001—you will be eligible to receive a RetirementPlus enhanced benefit if, at the time of your retirement, you:

• have accrued 30 or more years of creditable service, at least 20 of which are membership service with the MTRS or the Boston Retirement System as a teacher, and,
• have contributed at the RetirementPlus rate of 11% for at least five years, or have made accelerated payments to meet this contribution requirement.

However, if you are participating in RetirementPlus because you elected to participate in RetirementPlus, and you:

• do not accumulate 30 years of creditable service by your date of retirement, you will receive a retirement benefit calculated under the regular formula, and a refund of your RetirementPlus contributions, plus regular interest.
• retire with 30 or more years of creditable service, but fewer than 20 of your years are as a member of the MTRS or the Boston Retirement System as a teacher, you will receive the regular retirement benefit and a refund of your RetirementPlus contributions, plus regular interest.

Please note that if you are participating in RetirementPlus because you became a member of the MTRS on or after July 1, 2001, and you do not meet the criteria to be eligible for the enhanced RetirementPlus benefit, you are not entitled to a refund as your contribution rate of 11% was mandatory.

I am not participating in RetirementPlus because I elected not to participate (or I didn’t submit a timely election form). Can I elect in now?

No—your election opportunity was a one-time chance. If you do not elect to participate (or, in the case of members who are transferring into the MTRS from another Massachusetts contributory retirement system, miss your 180-day deadline for submitting your form), you cannot later opt in. If, however, you leave MTRS service, take a refund of your annuity savings account and then return to MTRS service, you will return as a new member and automatically be subject to RetirementPlus and the contribution rate of 11%.

How do I know if I am subject to RetirementPlus?

If you:

• transferred to the MTRS from another Massachusetts contributory retirement system on or after July 1, 2001, you have 180 days from the date that you transfer into the MTRS to enroll in RetirementPlus. If you submitted (or submit) an affirmative election within 180 days, you will be subject to RetirementPlus.
• joined the MTRS as a new member to a Massachusetts public retirement system on or after July 1, 2001, you are automatically enrolled in RetirementPlus.
• were a member of the MTRS prior to July 1, 2001, you had until June 30, 2001 to elect to participate in RetirementPlus. If you did not submit a timely, affirmative election, you were not enrolled in RetirementPlus and your contribution rate remained the same.

How divorce could affect your benefits

Your pension from the Massachusetts Teachers’ Retirement System is generally considered a marital asset and, whether you are actively in service or receiving a retirement allowance, it is subject to valuation and division in a divorce. If your former spouse is named an “alternate payee” by the court, he or she may be entitled to receive a share of your retirement benefits at the time of your retirement pursuant to the terms of a domestic relations order (DRO).

FAQs

What is a domestic relations order?

A domestic relations order—commonly known as a DRO—is a judgment, decree or order (including approval of a property settlement agreement) that sets out how a person’s retirement benefits are to be allocated between parties who are in the process of divorcing or who are already divorced.

Do I need to have a domestic relations order as part of my divorce?

If your retirement allowance (or prospective retirement allowance) is to be divided between you and your ex-spouse, you need a Domestic Relations Order. If there is no Domestic Relations Order, then at the time of your retirement we will not divide the retirement allowance.

The MTRS has developed a model domestic relations order to assist members, their spouses, former spouses and attorneys in drafting an order that meets all of the statutory requirements. To review this sample document, or obtain more information on divorce and how it could affect your MTRS benefits, please refer to our booklet, What You Should Know as a Party to a Domestic Relations Order .

What gives my ex-spouse the right to my retirement allowance? It comes from my work.

Your retirement allowance is considered a marital asset, just like your house, car, investments, or your ex-spouse’s retirement allowance can be. The divorce court can divide the retirement allowance or leave it alone, as it sees fit. Most often, the divorce court endorses a property settlement agreed to by the parties. You need to obtain legal counsel to help you reach a fair property settlement.

I’m still working. Can my ex-spouse take part of my pension now?

No, unless you leave Massachusetts public service and take a refund. The Domestic Relations Order will establish a formula for calculating how much of your future retirement allowance will be divided. Your ex-spouse can only get a share of your retirement allowance or refund when you apply for it and obtain your share.

Accidental death benefits

If you die as the result of an accident while you are an active member, your survivor may be eligible to receive an accidental death benefit, which is greater than the regular survivor benefit amount.

FAQs

When is my survivor eligible to receive an accidental death benefit?

Your survivor is eligible to receive an accidental death benefit in two situations:

• if, while you are an active member, you die as the result of a work-related accident or injury, or
• if you retired under accidental disability, and you die as a result of the injury or condition that precipitated your retirement.

What will my survivor receive as an accidental death benefit allowance?

If you are an active member and you are survived by a spouse, dependent child or dependent parent, your survivor will receive a one-time lump-sum payment of the balance in your annuity savings account, plus a lifetime survivor allowance equal to 72% of your current annual compensation. Your surviving spouse or guardian will also receive an additional $312 per year for each child under age 18, or under 22 if a full-time student. Children who are physically or mentally incapacitated from earning will receive a lifetime benefit.

If you retired under an accidental disability and you later die as the result of the injury or condition for which you received accidental disability benefits, your surviving spouse may apply for an accidental death benefit. If granted by the Board, your spouse’s lifetime benefit would be equal to 72% of what your yearly compensation was when you were last employed. In addition, your spouse would receive a one-time, lump-sum payment of the balance in your annuity savings account as of the time that the Board approved the benefit allowance. Your surviving spouse would also receive an additional $312 per year for each child under age 18, or under 22 if a full-time student. Children who are physically or mentally incapacitated from earning will receive a lifetime benefit.

If you retired under an accidental disability prior to November 7, 1996, and you die as the result of a cause unrelated to the condition for which you received accidental disability benefits, your surviving spouse could apply to receive an accidental death benefit of $12,000 per year ($1,000 per month).

Does the Board automatically award an accidental death allowance, or does my survivor have to apply for benefits?

Your survivor would need to apply for accidental death benefits, and the Board would have to review and approve his or her application. Your survivor should contact our office for detailed information.