“A participating employer shall maintain records necessary to calculate benefits under this title and other records necessary for proper administration of this title as required by the office.”
Employers are required by statute to maintain records that enable our office to determine an employee’s eligibility for retirement coverage. Employers must report information about each covered employee with the same frequency they generate payroll. Record keeping is a vital employer obligation that protects the interests and benefits of both the employee and employer alike. Employers must retain employee personnel and payroll records necessary to calculate retirement benefits until the earliest of:
» Three years after the date of retirement of the employee from a system or plan;
» Three years after the date of death of the employee; or
» Sixty-five (65) years from the date of employment with the participating employer.
Types of included records include, but are not limited to:
» Dates of hire and separation
» Rates of compensation
» Earnings
» Benefits provided
» Number of hours worked per week or percentage of full-time employment
» Employment status (full time, part time, permanent, temporary, seasonal, etc.)
» Dates of leave without pay
» Periods of workers’ compensation benefits
» Proof of whether or not the employee received benefits normally provided by the employer
» Number of months required for the job
» Meeting minutes establishing a definite and fixed term of office for appointed officials.
There are good reasons for participating employers to keep records. Many of the benefits provided to your qualified employees are defined by contractual agreement and may extend beyond the term of employment. If any party to the agreement questions its terms, conditions, or compliance with the agreement, the above mentioned records may be needed. It could mean the difference between being eligible to retire versus having to work additional years to qualify for retirement.
Sometimes, due to reporting errors, misunderstanding of the qualifying conditions, or a host of other reasons, questions arise that may not be resolved using the information found in the contribution report.
If the employer cannot validate an employee’s claim of earned salary required to make an adjustment, the Court mayrequest restitution from either URS or the employer.
While our office shares the long-term commitment attached to retirement benefits, the laws governing the Retirement Systems emphasize the employer’s responsibility to report and certify each employee’s eligibility status for retirement coverage. Our office is authorized to audit employers’ payroll reports to ensure compliance and to impose penalties for noncompliance. Employers failing to maintain these records can be held responsible for liabilities and expenses, including administrative expenses and costs of increased benefits to members. A penalty equal to 1% of the employer’s monthly contributions may also be imposed.
Employers should keep their employees’ records secure, whether within their own facilities or at offsite facilities.
The State Division of Archives and Records can answer records management questions and provide a list of analysts and agencies served. Call 801-531-3848 for more information.