CONTENTS
Public Employees' Retirement System Plan 2 (PERS 2) is a defined benefit retirement plan that provides a secure income for retirement.
Each January, PERS 2 members enrolled prior to March 1, 2002 have the option to transfer to PERS 3.
Participation in the PERS 2 retirement plan starts on your first day of employment In an eligible position. In this 401(a) defined benefit plan, you and the University contribute money to the Retirement Trust Fund which pays your retirement benefit. Once you retire, you will receive your retirement benefit based on your service credit and average final compensation, not based on yours or the UW’s contributions. Here is how it works:
PERS 2 is open to all eligible permanent or temporary contract classified, classified non-union and GCIU bargaining unit employees who work a minimum of 70 hours/month in any five months of a 12 month period.
All UW employees participate in their applicable retirement plan from the beginning of employment. Retirement plan participation is a condition of employment.
Newly Eligible Employees: If you participated in an employer-matched, defined contribution, basic retirement plan with your prior employer, you may be eligible to participate in the University of Washington Retirement Plan (UWRP) instead of the Public Employees Retirement System (PERS). Learn more.
Temporary Employees: If you are a temporary employee you may become eligible to participate in the Public Employees Retirement System (PERS) if:
Changing positions at the UW? If you move from a PERS-eligible position to a UWRP-eligible position or vice versa, email Benefits & Work/Life at benefits@u.washington.edu to determine your retirement plan choices.
Staff who are full-time UW students or the spouse of a full-time UW student: If you are a full-time UW student or the spouse of a full-time UW student, you may be eligible to exempt yourself from participation in PERS. However such exemption will not count toward future retirement service credits. Email Benefits & Work/Life at benefits@u.washington.edu to learn about exemptions from PERS participation.
Staff who transfered from another Washington state higher education institution: If you are hired into a PERS-eligible position, but you were participating in a Washington state public Higher Education Retirement Plan with another higher education institution (CWU, EWU, SBCTC, TESC, WSU, WWU), you may be eligible to participate in the University of Washington Retirement Plan (UWRP) instead of the Public Employees Retirement System (PERS). To be eligible for an exception to participate in the UWRP you must have:
If you believe you meet this exception criteria, email the Benefits & Work/Life Office to determine your retirement plan choices.
PERS 2 benefits are based on a formula—see "Calculating Your PERS 2 Retirement Benefits" below. Key to that formula is earning "service credit" for the time you are enrolled in PERS. There are two ways to earn service credit: month by month, or over an annual basis.
Month by month service credit is earned as follows:
At the UW, to obtain one full month of service credit in each of the 12 months, the minimum salaried appointment is 56.25%.
Alternatively, when you work for an institution of higher learning such as UW, you may receive 12 service credit months for the "school year" (i.e., September 1–August 31) if you:
You may receive six service credit months for each school year if you:
Note: If you earn compensation in fewer than nine months of the school year, you will receive service credit based on the number of hours compensated each month.
Monthly retirement income = 2% x service credit years x average monthly final compensation of your 60 consecutive highest-paid service credit months.
Example
Suppose you retire at age 65 with 32 service credit years. Your average
final monthly compensation is $2083. Your monthly retirement benefit will
be $1,327.
2% x 32 years x $2083 = $1,327.
This calculation results in the standard benefit. It will be lower if you choose to continue benefits to a survivor upon your death.
In addition:
REMEMBER: Newly-eligible employees must make the PERS 2 versus PERS 3 choice within their first 90 days. If you take no action, after 90 days, state law requires that employees be permanently moved into PERS 3 with a 5% contribution rate. This cannot be changed at any time during your employment at UW.
You can withdraw or transfer your employee contributions plus interest only if you completely separate from PERS employment. Processing a withdrawal is managed by the Department of Retirement Systems. Contact them directly for more information.
You cannot withdraw or transfer your employee contributions if you are moving directly to a PERS eligible position with another employer.
Your choices are:
If you withdraw your contributions before retirement, you lose your right to future retirement benefits. You can restore your contributions and re-establish your benefits under certain circumstances. Explore the PERS website for more information including member publications.
Save even more for retirement with the Voluntary Investment Program (VIP).
Contact the Social Security Office periodically to review your file's accuracy.
Refer to the PERS Plan 2 Member Handbook.
See the Department of Retirement Systems Summary Annual Financial Report.
Senate Bill 6157
In calculating average final compensation under this subsection for a member of PERS plan 1, 2, or 3, the Department of Retirement Systems (DRS) shall include any compensation forgone by the member during the 2009-2011 fiscal biennium as a result of reduced work hours, voluntary leave without pay, or temporary furloughs if the reduced compensation is an integral part of the employer's expenditure reduction efforts, as certified by the employer. UW Benefits will provide an update once administrative procedures are developed by the DRS. Until then, please contact DRS directly for more information.