COVID-19 Q&A
As our state responds to COVID-19, PERA continues to provide essential services to our members. We would like to keep you informed regarding a few operational changes to our day-to-day services.
Q & A
How is COVID-19 impacting day-to-day operations at PERA?
While PERA’s offices are closed to the public, PERA continues to serve our members. The PERA Member Services line (651-296-7460) remains open Monday through Friday from 8:00 a.m. to 4:30 p.m. While in-person counseling sessions are temporarily suspended, our benefit counselors continue to provide over-the-phone counseling sessions.
Applications for retirement benefits, disability applications, and refund applications are being processed. PERA continues to receive mail daily. If you need to submit any paperwork to PERA, please mail your documents to:
PERA
60 Empire Drive, Suite 200
Saint Paul, MN 55103
If you would like to drop off your documents, we have a lockbox located in the main floor lobby of the St. Paul Retirement Systems building (address above). The building is open from 8 a.m. to 4 p.m.
Will I continue to receive my PERA benefit?
PERA benefit recipients will continue to receive benefit payments as scheduled.
If I am on a COVID-related leave of absence from work and return to work, what happens to my benefit?
Two of the factors we use to calculate your benefit—service and salary—may be impacted by your leave.
Generally, if you are receiving a full salary during your leave of absence, whether it be due to paid leave time, sick, vacation, partial work hours, or a combination of any of these pay types, these are considered PERA-eligible salary and you will contribute to PERA. (Note: Certain types of leave pay, such as Worker’s Compensation paid leave, are not considered PERA-eligible salary).
If you are missing some or all of your salary during your leave, you may purchase missing employee and employer contributions plus interest to restore service and salary. The leave purchase is optional but could result in a larger benefit from PERA.
After you return from the leave, you and your employer will need to complete the leave form. PERA will then send you purchase information and benefit estimates and the purchase must be made within a year of the leave. It is important to note that the employer is not required to pay their portion of missing contributions. You may have to pay the entire amount for the missing service and salary credit.
What happens if I am laid off due to COVID-19?
Two factors we use to calculate your benefit – service, and salary – are impacted by a layoff. However, if your employer reports you are on a layoff, you may be eligible to receive up to three (3) months of service credit for a layoff period of missed service once you return to public employment. The option to purchase salary or service credit is not available to members returning from a layoff status.
What happens if I do not return to work after a lay off or leave due to COVID-19?
If your employer classified your COVID-19 related absence as a lay-off, you may receive up to three months of service credit.
If your employer classified your absence as a leave, and you terminate PERA-covered employment after your leave, you have thirty days from your termination date to send PERA the leave form and make the purchase
May I retire while on a COVID-related absence?
You may retire during a COVID-related absence, as long as you terminate all public service. An absence, leave, or lay-off is not considered a termination of public employment. If you are applying for a retirement benefit, we must receive a completed Verification of Termination form from you. Please see the Retirement Application toolkit on our website for more information.
In order for you to qualify for your PERA benefit, you must have a complete and continuous separation from all public employment for 30 days. Public employment is service to any governmental employer in Minnesota–e.g. school districts, cities, counties, townships, and state. In addition, you cannot have a pre-arranged agreement to be re-hired by your employer or be hired by another public employer – there can be no written or verbal agreement prior to termination to provide services to a public employer.
What happens if my hours are reduced due to COVID-19-related leave?
As long as you are still being paid, you will continue to make contributions to PERA and earn service credit. The reduction of hours may have an impact on your high-five salary used to calculate your benefit. If you are missing some of your salary during your leave, you may purchase missing employee and employer contributions plus interest to restore salary. The leave purchase is optional, but could result in a larger benefit from PERA.
After you return back to your normal schedule, you and your employer will need to complete the leave form. PERA will then send you purchase information and benefit estimates and the purchase must be made within a year of the leave. It is important to note that the employer is not required to pay their portion of missing contributions. You may have to pay the entire amount for the missing service and salary credit.
If I terminate and collect my PERA benefit, what happens if I am re-hired by my employer?
If you are considering returning to public employment in any capacity after retirement, consult with a PERA representative.
Should you return to PERA-covered employment after retirement, after you have met the 30-day termination requirement, you will continue to collect your retirement benefit and pay no contributions to PERA. (Please see PERA’s termination requirements for more information).
However, if you are under full retirement age for Social Security and your earnings exceed the annual limits, your total annual pension will be reduced or suspended and the withheld amount set aside in an escrow account. These earnings limits are subject to change each year. You can contact Social Security at 1-800-772-1213. Additional information is available in the Working After Retirement brochure.
Earnings limits only apply to PERA-covered employment. There is no limit on earnings from self-employment, private employment, elective service, investments, pensions, or other sources of income.
Is paid leave considered eligible salary?
Yes. Compensation in the manner of paid leave is considered eligible salary for PERA contributions.
How has the market volatility impacted PERA?
Please see our news article, Benefit Security, to address common misunderstandings.
Does the Federal CARES Act impact members of PERA?
While the Federal CARES Act permits retirement plans to allow COVID-19 related withdrawals from retirement plans that are repayable over three years and not subject to the early-withdrawal penalty or 20% tax withholding, these changes do not currently impact PERA members. PERA’s retirement plans are administered pursuant to their governing statutes, so the CARES Act provisions will not be implemented without legislation. If you have further questions relating to COVID related distributions, please contact your tax consultant.
The federal waiver of required minimum distributions (RMDs) for 2020 in the CARES Act applies to PERA’s defined contribution plan, but not to PERA’s defined benefit plans. The IRS has provided guidance stating that 2020 RMDs that have already been paid may be rolled over to an eligible retirement plan. The IRS has extended the 60-day rollover period for RMDs so that the deadline will not be before August 31, 2020. If you received an RMD from PERA’s defined contribution plan, please contact your tax consultant if you have questions about a rollover.