RETIREMENT CHECKLIST FOR HR OFFICE

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RETIREMENT CHECKLIST FOR HR OFFICE Powered By Docstoc
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                              RETIREMENT CHECKLIST
                               For the Agency HR Office

This checklist addresses important steps in the retirement process that are handled by the
 agency HR Office. Where appropriate, reference is made to other entities (People First
Service Center, Division of State Group Insuranc,e Division of Retirement, etc.) which are
         also involved in the process or may be responsible for certain activities.

 □   CERTIFICATION OF THE STATE RETIREMENT APPLICATION.

     Depending on the type of retirement (Regular, Disability, DROP, Investment Plan, etc.),
     the HR Office will need to sign/certify the appropriate retirement application. These
     forms may be accessed from the Retirement website at http://www.myflorida.com/frs .

     →      Good practice is for the HR Office to require that the employee write a letter of
            resignation that should be submitted no later than the retirement application itself.
            In this letter, the employee should specify the effective date of resignation (last
            day for pay purposes) along with his/her intent to retire. If the retirement
            application does not accompany this letter, the employee should be asked to
            follow up with the application as soon as possible (bearing in mind that the
            Division of Retirement accepts applications no more than six months in advance).
            Once the agency has certified the retirement application, it should be forwarded to
            the Division of Retirement along with any other documentation (e.g., copies of
            birth certificates, etc.) that the employee has attached. Remember, if faxing the
            application and other documentation, it is NOT necessary to mail the original. (In
            such cases, retain the original paperwork in the employee’s personnel file).

     →      Timely submission of the retirement application is critical in order to ensure that
            the Division of Retirement can assign the effective date of retirement that the
            employee is seeking. Consult with the Division of Retirement regarding the
            application deadline associated with specific retirement dates and the rules
            regarding submission of other required documentation that the employee will
            need to provide before his/her name may be added to the Retired Payroll.

     →      In the course of acknowledging an employee’s resignation for purposes of
            retirement, it is recommended that the employee be referred to the document
            called “State Retiree Checklist”, which is available on-line at
            http://dms.myflorida.com/human_resource_support/human_resource_managemen
            t/human_resource_benefit_programs
            This document lists activities and other considerations of which the employee
            needs to be aware to properly carry out retirement and continuation of state group
            insurance coverage. More importantly, it addresses immediate steps that the
            employee can take to enroll and initiate payment of retiree premiums without
            having to wait for the official retiree insurance packet that is triggered only after
            the agency has acted upon the employee’s separation PAR for retirement reasons.



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□   CERTIFICATION OF LEAVES OF ABSENCE OR PERIODS OF WORKERS’
    COMPENSATION FOR PURPOSES OF ESTABLISHING RETIREMENT
    CREDIT.

    The HR office may need to research records to see if the employee was granted a leave of
    absence that the employee may purchase to add retirement credit. Any such period of
    leave needs to be verified on Form FR-28, which is available on the Division of
    Retirement’s website (http://www.myflorida.com/frs). Any periods of eligible Workers’
    Compensation must be certified on Form WC-1, also available on this website. For
    information on the eligibility of periods of Workers’ Compensation, contact the Division
    of Retirement.

□   FINAL SALARY CERTIFICATION FOR PENSION PLAN MEMBERS.
    A certification of the employee’s last four months of salary (including terminal leave
    payments) must be submitted to the Division of Retirement no later than the 5th of the
    month in which the employee’s retirement is effective. Form FC-1 is available on-line at
    http://www.myflorida.com/frs. (Because this form is submitted for DROP participants
    when they first enter DROP, it does not need to be completed when an employee is
    terminating from DROP).

□   CERTIFICATION OF TERMINAL LEAVE PAYMENTS TO THE SOCIAL
    SECURITY ADMINISTRATION (SSA).

    On occasion, the SSA may request that the agency provide information regarding all
    earnings (including terminal leave payments) received during the calendar year in which
    the employee retired. The employee and/or the SSA may contact the HR Office and
    request that a form be completed for this purpose. If the HR Office needs assistance
    researching/verifying many hours of annual and sick leave were paid and what portion of
    these hours were accrued in the calendar year of payment (versus having been accrued in
    prior calendar years), the People First Service Center may be contacted, as appropriate.

□   CERTIFICATION OF MEDICAL COVERAGE AS REQUIRED TO COLLECT
    THE HEALTH INSURANCE SUBSIDY BENEFIT

    The Division of Retirement requires that, before eligible retirees start receiving the
    monthly health insurance subsidy benefit, they must first submit a completed Health
    Insurance Subsidy Form (HIS-1), certifying they have qualifying coverage. This form is
    mailed to the employee in the “Retiree Packet” that the Division of Retirement sends to
    employees who have filed for retirement.

    If the employee is continuing health insurance under the State Group Insurance Program
    and/or Medicare, the HIS-1 form should be mailed to the People First Service Center at
    P.O. Box 6830, Tallahassee, Florida 32314 for completion of Section B. Once the
    Service Center has completed the form, they will mail it to the Division of Retirement.




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    If the employee is enrolled in any other (not State Group ) health insurance plan, which
    will be continued after retirement, then the HIS-1 form must be mailed to the carrier of
    that plan and NOT the People First Service Center.

□   FLEXIBLE SPENDING MEDICAL ACCOUNT PARTICIPANT PAYMENT
    OPTIONS.

    The “Medical Reimbursement Account – Termination of Employment” Form gives
    employees several options for handling participation in the medical reimbursement
    account if terminating employment during the plan year.

    The employee may elect one of the following: to use terminal leave payment for making
    full or partial payments (on a pre-tax basis); to make a lump sum or monthly payments
    (on a post tax basis); or to terminate plan participation without making further
    contributions.

    After the employee has made their election and signed the “Medical Reimbursement
    Account-Termination of Employment” Form, the HR Office should sign the form and
    submit it to the People First Service Center at P.O. Box 6830, Tallahassee, Florida 32314
    for further processing.

□   TIMESHEET AUDITS.

    To facilitate payment of terminal leave, all missing timesheets will need to be identified.
    Agencies are provided with a missing timesheet report at least once a month, which
    contains all missing timesheets in the current fiscal year, for all active and terminated
    employees. Prior to the employee’s separation date, the employee will need to submit,
    and the supervisor will need to approve, any missing timesheets.

    NOTE: The supervisor should ensure that the employee has submitted the last timesheet
    no later than the last day worked and that such timesheet is completed through the last
    day (to be) paid.

□   SEPARATION ACTION.

    While it may be advisable to act upon the separation PAR as close to the last day of work
    as possible, the agency may find it advisable to ensure that all timesheets have been
    approved and a complete audit of leave hours has been conducted before actually
    processing the PAR, as long as it is done by the appropriate payroll cutoff date.

    →      Special Note for Biweekly Agencies: When employees terminate at or near the
           end of a calendar month, it is not uncommon for state group insurance premiums
           to be inadvertently paid for a future coverage month to which the employee is not
           entitled. When such overpayments occur, appropriate steps must be taken to
           recover the employee and agency refund. However, it may be possible to avoid
           this scenario through careful timing of when the Separation PAR is processed.


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        Specifically, the agency can plan on acting upon the PAR no later than the cutoff
        day for the biweekly payroll that produces a warrant for the first month in which
        the employee is no longer eligible for employer contributions.

        For example, if the employee’s last day paid is to be December 29, 2006 (the last
        workday of that month), the last coverage month for which he is entitled to
        coverage as an active employee is January, 2007. The premium payment due for
        January 2007 will be split between his December 8, 2006 and his December 22,
        2006 biweekly warrants. Therefore, to prevent deductions from his January 5,
        2007 warrant (which will cover his workdays of December 15 through December
        28, 2006) and his January 19, 2006 warrant (which will cover his last workday of
        December 29, 2006), the agency will have to act upon his Separation PAR no
        later than December 28, 2006 (which is the People First cutoff for the biweekly
        period covered by the January 5, 2007 warrant).

        By reviewing the payroll calendar each month, it is possible to anticipate these
        scenarios and take appropriate steps, if desired.

        →Note: Once a separation PAR is fully acted upon and completed (and the
        employee’s separation date has passed) the employee’s logon ID will become
        inactive. Currently, an employee who has been separated is not able to log into
        the People First System until the People First System has finalized the process of
        converting his/her status from active to retiree. This “black out” period in the
        system may last 30 to 60 days, depending on the span of time between the
        effective date of separation and expiration of active coverage. For example, if the
        effective date of separation is February 16 (last day paid was February 15), then
        active coverage does not expire until March 31 and access to the system would
        not resume until April 1.

□   TRIGGERING TRANSITION FROM ACTIVE TO RETIRED COVERAGE

        The employee must submit completed paperwork or call the Service Center to
        elect to continue benefits as a retiree. The “State Retiree Checklist” outlines the
        steps and general timelines around these activities. Upon receipt of the retiree’s
        forms or phone call, the Service Center will check to see if the PAR has been
        acted upon/completed. If so, the employee’s retiree elections will be processed
        immediately. However, if the PAR has not been completed, the forms and/or
        further action will be pended until the PAR is acted upon.

□   TRIGGERING THE RETIREE “INSURANCE” PACKET

        Once a separation PAR is fully acted upon and completed (using the “Retirement”
        Reason Code), the People First System will automatically generate a retiree
        insurance retirement package that will be mailed to the retiree’s address in the
        System at that time. Note: This package will be generated and mailed even if the
        employee has already completed the retirement paperwork in advance (by using


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             the alternative method described in the “State Retiree Checklist” document).
             However, if the appropriate benefit elections have already been made by the
             employee, then he/she may be advised to disregard the System generated package.

   □   TRIGGERING THE INCLUSION OF THE EMPLOYEE ON THE FILE TO THE
       DIVISION OF RETIREMENT (FOR DEDUCTION OF RETIREE PREMIUMS
       FROM THE MONTLY RETIREMENT CHECK)

          Once the employee is coded as a retiree in the People First System, the information
          will be sent to the Division of Retirement to begin pension deductions. As a general
          rule, deductions start with the second pension check (the employee will have already
          paid for the first month of retiree coverage via personal check).

   □   ADDRESS UPDATES.

          It is important to ensure that the employee’s correct/updated home address is in the
          system, to facilitate delivery of the W-2 at the end of the calendar year. The "A" and
          "H" role users have the ability to updated terminated employees home addresses in
          the system.

   □   CERTIFICATION OF TERMINATION FROM DROP.

          In anticipation of a DROP participant terminating employment from DROP and, by
          extension, the agency, a DP-TERM Form must be completed, signed by the HR
          Office, and submitted to the Division of Retirement. This form requires notarization.

   □   PROCESSING TERMINAL LEAVE PAYMENTS.

          Currently, terminal leave payments must be processed through either the PC Payment
          System or the On-Demand System of the State Payroll System.

   □   TERMINAL LEAVE PAYMENTS TO DEFERRED COMPENSATION

          If an employee has elected to invest their terminal leave payments into the Deferred
          Compensation Plan, the HR Office should receive copies of instructions from the
          employee, which in turn the employee receives from his/her investment provider.
          When processing these terminal leave payments through either the State Payroll PC
          Payment or On-Demand Systems, the agency should use the appropriate code to
          indicate that it is a tax deferred transaction. Bear in mind that the Bureau of State
          Payrolls has to receive additional documentation directly from the Deferred
          Compensation Office before these types of payments are actually processed.

DMS/HRM/PF/abg 10206




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