Before hiring a VRS retiree, be sure you understand the return-to-work requirements and discuss them with the prospective hire before bringing them on board.
Key Rules to Remember
When hiring a retiree in a non-covered position (typically part-time at 80% or fewer hours than a comparable full-time position), keep these important requirements in mind:
- A bona fide break in service of at least one full calendar month during a period the employee would normally work is required before returning to work.
- There can be no pre-arrangement to rehire the employee after retirement.
- Employers cannot reclassify a position solely to accommodate a retiree.
Special rules also apply to retirees receiving disability retirement benefits.
The impact on VRS benefits when a retiree returns to work depends on the type of position the retiree will fill. In general, retirees may return to:
- A full-time, VRS-covered position, where retirement benefits will cease upon reemployment.
- A part-time, non-covered position that meets return-to-work requirements, allowing them to continue receiving retirement benefits.
- Critical shortage and retiree school security officer positions in school divisions, allowing them to continue receiving a retirement benefit while working full-time in the approved position. The retiree must have a break in service of at least six consecutive months between retiring and starting in a critical shortage position.
Counsel Prospective Hires
Before hiring a retiree, make sure they understand how returning to work could affect their retirement benefits.
In almost all cases, retirees who return to a VRS-covered position stop receiving their monthly retirement benefit while employed.
Depending on their circumstances, a retiree who returns to work and then retires again could experience a lower retirement benefit, due to:
- Loss of accumulated cost-of-living adjustments (COLAs).
- Loss of hazardous duty enhanced benefits, if applicable.
Resources for Employers
For a complete guide, visit the Hiring VRS Retirees webpage, which includes employer responsibilities and compliance requirements.
You can also use the Return-to-Work Checklist for Employers to help ensure compliance with VRS requirements and guide conversations with prospective retiree hires.
Guide retirees to the Working After Retirement webpage for additional information and encourage them to meet one-on-one with a VRS counselor before accepting the new position.
Contact Us With Questions
After reviewing this information, please contact VRS Employer Support with any remaining questions to ensure your rehiring process goes smoothly.
