However , because the officer is still below age 55 , he must still have a “ bona fide separation from service ” which means that he must be separated from his employment for at least 60 days before starting to work as a special events reserve officer . Otherwise , the officer would need to be reinstated in CalPERS membership . It is especially important to note that the “ normal retirement age ” for the officer derives from the pension formulas used by the agency where the officer worked during active membership , and not on the retirement age at the agency , that subsequently hires him for special work .
Another important restriction on postretirement work is that a retiree who is rehired to an “ extra help ” position , or to an interim appointment in a vacant position , can receive no compensation other than an hourly rate equivalent to the maximum monthly salary paid to other employees performing comparable duties as listed on a publicly available pay schedule ( calculated by dividing that monthly salary by 173.333 ). CalPERS has indicated that overtime pay required by the Fair Labor Standards Act is permissible , but this appears to be the only exception . This means the retiree cannot receive benefits like holiday pay , contract overtime , or shift differentials , even if the retiree works an assignment or a shift that would normally earn those benefits .
In response to the COVID-19 pandemic , Governor Gavin Newsom issued an Executive Order on March 12 , 2020 . The Executive Order , among other things , suspended certain restrictions applicable to retired annuitants . On March 18 , 2020 , the California Public
Employees ’ Retirement System (“ CalPERS ”) issued Circular Letter 200-015-20 , which explains the restrictions that are suspended for the duration of the state of emergency caused by the COVID-19 pandemic . Any hours worked by a retired annuitant to ensure adequate staffing during the state of emergency will not count toward the 960-hour per fiscal year limit . In addition , the 180-day wait period between retirement and returning to post-retirement employment is suspended . Most other retired annuitant restrictions , including the limitations on permissible compensation and the prohibition of any benefits in addition to the hourly rate , remain in effect .
However , although CalPERS has issued guidance confirming that these restrictions are suspended , the language indicates that CalPERS will likely interpret the executive order narrowly . Accordingly , agencies must be cautious when relying on the Governor ’ s executive order to hire retired annuitants - or have retired annuitants work beyond the 960-hour limit – and should ensure that their duties are directly related in some way to the pandemic .
Agencies must continue to enroll , and report retired annuitants to CalPERS . We anticipate that CalPERS will continue to monitor the work hours for retired annuitants , and particularly those covered by Governor Newsom ’ s order .
For these reasons , and because the consequences of violating postretirement work restrictions can be extremely costly – particularly to the retiree – we recommend agencies work closely with trusted legal counsel to ensure compliance with the aforementioned guidelines .
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