[February 6, 2009]

To ensure the effectiveness of the University of California's practices regarding the reemployment of retirees, the University has enacted a new policy for retired UC employees who return to UC in staff or Senior Management Group (SMG) positions. The University's policy, which does not apply to academic appointments, aims to ensure compliance with Internal Revenue Service rules regarding defined benefit pension plans such as the UC Retirement Plan (UCRP), while continuing to give managers the flexibility to call on a valued resource—retired employees—when needed.

In certain instances where there are compelling circumstances, UC retirees are re-hired to help fill a particular staffing need, a common practice among employers throughout the country. Most rehired UC retirees work on a part-time basis and for limited duration, which supports the orderly administration of the retirement system and the need to refresh the UC workforce.

The Regents approved the policy in September, 2008, and after internal review, it became effective January 1, 2009.

The policy, which replaces the Guidelines for Rehire of UC Retirees, applies to former employees who elect either a lump sum cashout or a UCRP monthly retirement benefit. It includes the following provisions:

• Reemployment must result from University need, for example: the retired employee possesses skills and institutional knowledge that the hiring department cannot otherwise obtain with equal cost effectiveness; the hiring department anticipates a prolonged process for hiring a replacement; or the hiring department anticipates that the retired employee will assist the replacement in acquiring necessary skills and knowledge.
• Reemployment must not occur until there has been a break in service of at least 30 days, and preferably 90 days. In addition, employees who have not reached normal retirement age (defined by UCRP as age 60 for most members and age 50 for Safety members), must not engage in discussions concerning reemployment until after they have received their first monthly payment or lump sum cashout or 30 days after separation, whichever is later.
• The appointment must be limited to no more than 43 percent time in a 12-month period.
• Employment of a retiree must not exceed a total of 12 months. If reemployment is necessary after 12 months, the request for continued employment must follow the same approval process as the original appointment.
• When a retired employee is reemployed on a temporary basis into a career position, the job must be posted and a search begun within 30 days of the vacancy being created, and a minimum 30-day recruitment period must be held.
• The location's Executive Officer (i.e., chancellor, laboratory director, or president) must approve all appointments. In addition, The Regents must approve the appointment of a retired employee into a SMG position or one in which the annualized base salary plus any other cash compensation that meets or exceeds the Indexed Compensation Level (currently $275,000).
• Each rehired employee receiving a monthly retirement benefit must submit a completed UCRP Retired Employee Election Form. (The form is not required for retired employees who received a lump sum cashout.)

A retired employee who is receiving UCRP monthly retirement income may be hired into a career position after the required break in service provided there has been an appropriate recruitment process and that the employee agrees to suspend the retirement income payments. A retired employee who takes a lump sum cashout may not be reemployed into a career appointment.

Current rehired retirees are subject to the Guidelines in place prior to implementation of the new policy. In general, when the current appointment ends or there is a change to that appointment, the retired employee will become subject to the new policy.

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