PERAC Memo #41 - 2003: Military Pay Act (Section 1 of Chapter 137 of the Acts of 2003)

Military Pay Act (Section 1 of Chapter 137 of the Acts of 2003)

Summary

This memo notifies boards of Chapter 137 of the Acts of 2003, which permits counties, cities, and towns (upon local legislative approval) to pay employees on military leave for national guard/reserve service the difference between their base salary and military pay, effective through September 11, 2005. Where a municipality adopts this provision, that salary differential is regular compensation subject to retirement deductions, and boards should refer to Memorandum #39/2001 for guidance on creditable service and contribution treatment. No board action is required unless the local jurisdiction adopts the provision, in which case the board must apply proper retirement deductions to the supplemental pay.

Full Text

Memorandum # 41/2003

M E M O R A N D U M TO: All Retirement Boards FROM: Joseph E. Connarton, Executive Director RE: Military Pay Act (Section 1 of Chapter 137 of the Acts of 2003)

DATE: December 17, 2003

Governor Romney has signed Chapter 137 of the Acts of 2003. Section 1 of this Act authorizes counties, cities and towns to pay any employee who has been granted a military leave of absence because the employee is a member of the army national guard, the air national guard or a reserve component of the armed forces of the United States called to active service in the armed forces of the United States after September 11, 2001 his base salary less any amount received for his or her military service. This Section requires local legislative approval. This provision expires on September 11, 2005.

In a county, city or town which adopts this provision, the difference between the member’s base salary and his or her military salary would be regular compensation for retirement purposes.
Retirement deductions must be taken from this portion of the salary. Creditable service issues and retirement deductions for the portion of the salary paid by the military is fully discussed in PERAC Memorandum #39/2001.

We trust the foregoing is of assistance. If you have further questions or concerns, please contact this office.