FREQUENTLY ASKED QUESTIONS
Retirement Incentive Payment
I have 30 years of service but would like to teach one more year.
What if I qualify this year but don't choose to retire?
The incentive is structured as a one-time only option for individuals who have 30 or more years of STRS service credit as of July 1 or August 1, 2003 and for those who reach 30 years of credit as of July 1 or August 1, 2004. If you are eligible this year and choose not to retire, you will not be eligible for any incentive next year.
How much time do I have to make a decision?
You must meet notification timeline requirements in order to qualify. If you intend to retire at the end of this year (2003-04) and qualify for the incentive, be sure to notify the superintendent, through the Personnel Office, no later than December 1, 2003. Be careful not to miss this deadline.
Can I get the incentive and then also take advantage of the Retire-Rehire option?
No. Those who qualify for the incentive and retire do not also qualify for the retire-rehire option. Note, however, that the timeline for the retire-rehire process does allow for those who are denied their request for re-employment to still retire under the terms of the incentive.
I'm eligible to retire in April. Do I get the incentive if I retire effective May 1?
No. In order to qualify for the incentive, you must teach until the end of the school year, even if you may be eligible for STRS retirement earlier in the year.
I have 28 years of service this year. Can I assume that the incentive will be available when I'm eligible to retire?
This retirement incentive is in effect for only the 2002-03 and 2003-04 school years. Any future incentive will be subject to future negotiations. Do not assume that the incentive will or will not be continued, in this form or in any other way, after 2004.
I've taught in Worthington for 15-1/2 years, including one year when I took an unpaid leave of absence for a semester. Of this time, for three years I only taught part-time. If I qualify for the incentive, how much will I receive?
You would receive $1,000 for each full year of active service, or $15,000. Whether your service is part-time or full-time is not relevant; however, you will need to have been actively employed (including time spent on paid leave) for 185 days in order for a year to count.
Retire-Rehire Option
How would it benefit me to retire and be rehired in the district?
The main advantage is the financial benefit of being able to collect your STRS pension benefit while continuing to earn a salary and health care benefits from the Worthington Schools. A teacher with a Master's degree who retires with 30 years of teaching experience would have a pension benefit of approximately $44,000 (or 66% of his or her final average salary). That income would be supplemented by a $56,000 salary (at Step 10 of the 2003-04 index), for a total gross income of around $100,000. With STRS health care costs rising dramatically, the ability to keep Worthington Schools health insurance is another major advantage. In addition, those who have over 200 days of accumulated sick leave at the time of retirement would be able to carry that excess number of days over to their period of re-employment. A deferred severance payment may also provide tax savings for the re-employed teacher. Finally, it provides those with experience who are able to retire but still want to teach the opportunity to stay active in the classroom and their profession.
Note: While the short-term salary benefit is evident, it is important to meet with STRS benefits counselors to examine the long-term costs and benefits of retiring versus continuing active employment. This will vary depending on the number of years of service you have in the system.
What's the financial benefit to the district?
The school district saves money by being able to continue to employ highly experienced teachers at about 80% of the salary that it would otherwise be paying to the same individuals had they not chosen to retire. Additionally, the ability to defer severance payment until the time the re-employed teacher no longer returns allows for the district to begin saving money immediately.
What are the risks involved with this option for re-employed teachers?
It is important to remember that if rehired, you are on a one-year only contract that automatically expires at the end of each year of re-employment. While it is possible that you would be rehired again in future years, there is no guarantee of it. Therefore, it is not recommended that you apply for this option if you have determined that you need to work more than one year after retirement to meet your goals. There is also no guarantee of assignment, and your seniority would start over.
I'd like to retire and be rehired. Will I automatically be approved?
The Retire-Rehire option is voluntary for both the staff member and the district. A teacher who may be eligible does not have to apply for retire-rehire, and the superintendent may accept or deny any request. An explanation of the reason for a denial of a request for retire-rehire may or may not be provided.
I would rather wait until later in the year to decide whether or not to apply for this option. Do I have much time?
You may actually request to retire and be rehired at any time. This is a change from the original Retire-Rehire language negotiated in January 2003, and it is designed to increase flexibility for members considering this option. While you may seek to do this at any time, note that the timing of your decision may have financial ramifications. (See next question.) Also, if you retire and are re-employed in the middle of the school year, you will be guaranteed a position in the school district only for the duration of that year.
This process requires that teachers who utilize the retire-rehire option retire no earlier than the last day of school and return no later than the first day of the next year. Doesn't STRS require a 60-day break in service to qualify for receiving pension benefits?
Because STRS
retirement always commences on the first day of the month, there is no way
to meet the 60-day break in service requirement under this process. The
penalty for not meeting this requirement is foregoing pension payments in
any month during which you work during the 60-day period. The effect is
that a teacher who retires on June 30 and is re-employed in August would
forego his or her August pension check.
Can I still receive the retirement incentive if I am approved for retire-rehire?
No. Retiring teachers may be able to take advantage of one option or the other, but not both.
How will my severance pay be handled if I retire and am rehired?
Your severance pay is based on three variables: your daily rate of pay at the time of retirement, the number of accumulated sick leave days that are unused when you retire, and the number of continuous years of service you have in Worthington. If you retire and are re-employed, all of this will be calculated when you retire and held until the end of the school year when you later resign or are no longer under contract to return for the following school year. In addition, if you do not have the maximum allowable number of years of continuous Worthington service (27) when you retire, you can continue to accumulate service credit toward your severance. However, those extra years earned after re-employment may be calculated at a lower daily rate of pay when you ultimately leave. See the following example for illustration:
EXAMPLE:
John Smith retires with 250 days of accumulated sick leave and 20 years of continuous service in the Worthington Schools. His per diem rate of pay at the time of retirement is $404.50. He is re-employed under the terms of the Memorandum for one additional year and then resigns at the conclusion of that year. His per diem rate of pay at the time he resigns (at step 10) is $322.81. Severance pay is calculated as follows:
I. Sick Leave Severance:
200 days x 25% x per diem = 50 x $404.50 = $20,225 (payment deferred)
(Note: Remaining sick leave balance of 50 days not used toward above calculation carries over.)
II. Years of Service Severance at Time of Retirement:
10 years x 1.5 days x per diem = 15 x 404.50 = $6,067.50 (payment deferred)
III. Years of Service Severance at Time of “Final” Retirement:
1 year x 1.5 days x per diem = 1.5 x 322.81 = $484.22 (added to I and II-A and paid at this time)
(Note: Because he was credited with 15 days at the time of initial retirement, the maximum number of days that could be used in this calculation would be 10.5.)
TOTAL SEVERANCE PAYMENT: 20,225 + 6,067.50 + 484.22 = $26,776.72