Credit Balances Process Updated

In mid-October, we made a change to the credit balance process and how the employer credits are used to satisfy employer liabilities. An Employer Notice was sent to employers on Sept. 28 outlining the changes.

The Internal Revenue Services' Employee Plans Compliance Resolution System (EPCRS) as contained in Revenue Procedure 2021-30 outlines how the correction process is to be managed by the retirement system. This procedure states that the employer credit, once applied to the employer's account, must be applied toward future employer liabilities required by Ohio Revised Code Section 145.51 before we can accept additional employer liability payments.

Based on the EPCRS and Ohio Revised Code, we have made changes to our internal systems as well as to ECS to accommodate this process. When submitting payment or payment remittance advice (E3) on ECS, there will no longer be an option to select which credits to use toward employer liabilities due. ECS will automatically apply the credit to comply with the procedure. ECS will display the liabilities the credits were applied to for your record. This will be shown on the payment review page of ECS as well as on the confirmation page.

When submitting a paper check, wire transfer or ACH payment, the system will automatically apply the credit to all pending employer liabilities prior to allocating a payment submitted by the employer to the charge. We will then apply the new incoming payment to the remaining employer liability and return any excess amounts not allocated to the employer account.

We are offering training for ECS users to demonstrate how to read the new payment screens and how to identify which credits have been applied to which charges. These trainings will be held in October and November 2023. To sign up for these training courses, please go to the Seminars & Webinars section on opers.org.

Importance of using Pay Period End Codes

We have several internal processes that rely on the employer to submit a pay period end code on the member's final contribution when the employee quits or retires. A pay period end code is also used to indicate that the employee is seasonal.

One process is the retirement process. We rely on the pay period end code to indicate that the members have terminated employment, and the last contribution has been submitted. In addition, the pay period end date should reflect the last day of earnings which may or may not be the last day of your reporting period.

The re-employment process uses the pay period end code of Quit, "Q", to determine that someone who is a re-employed retiree has terminated their re-employment. This is important as it triggers their Health Reimbursement Arrangement (HRA) or Retiree Medical Account (RMA) to be released for use.

It is also important to use the pay period end code of "Q" when someone terminates their employment and intends to refund their OPERS account. If the pay period end code is present, the member does not need to have the refund application confirming they terminated employment.

The Seasonal, "S", pay period end code notifies OPERS that the member is intermittent or working seasonally. This is important for our Required Minimum Distribution (RMD) process that takes place annually for those members over the RMD age. If a member's contributions cease, but there is no pay period end code, the member is subject to the RMD rules. OPERS will notify the members who are subject to the RMD of their options. Action is required by the member. Therefore, if we do not receive a response, OPERS will distribute contributions appropriately.

ECS Contacts

There are two employer user lists in ECS, the employer contact information and the ECS user list. It is important to keep both lists up to date.

The employer contact information is a list of individuals who are permitted to discuss your employer's account with OPERS and notates who is an authorized signer for the organization. This can be updated by your Delegated Administrator (DA) on ECS under the Employer Contacts button on the main screen. The DA can add, disable or update the permissions available to any current employer contact. Consider reviewing your employer's contact list on a regular basis.

The ECS user list is a list of individuals who have been granted access to use ECS and should be reviewed periodically. Please remember to disable the ECS user account for any individuals who leave employment with your entity. This will notify OPERS that we can no longer discuss the entity's account with that individual. You can manage your ECS user list under User Management from the ECS main menu.

If you need assistance updating your employer contact information or the ECS user list, please contact Employer Outreach at 1-888-400-0965 or employeroutreach@opers.org.

Earnable Salary for 2024

The minimum earnable salary for 2023 is currently $709.03 per reporting month and will increase to $721.44 beginning with the first payroll reporting month ending in 2024 for pension credit.

If an employee earns less than the minimum earnable salary in a reporting month, the amount of service credit that is earned will be pro-rated. The minimum earnable salary will continue to increase each year through 2029.

Notice of Re-Employment or Contract Services of an OPERS Benefit Recipient (Form SR-6)

This form is required when hiring or engaging the services of any of the following benefit recipients (whether as a public employee, an independent contractor or in any other capacity):

  • an OPERS age and service benefit recipient,
  • an OPERS disability benefit recipient, or
  • a retired elected or appointed official returning to employment to an elected office.

The SR-6 or "Notice of Re-employment or Contract Services of an OPERS Benefit Recipient" form should be submitted by the end of the month in which an OPERS benefit recipient begins re-employment or contract services with an OPERS employer. If the individual starts within the last 10 days of the month, in addition to submitting this completed form, the employer will need to contact Employer Services immediately to prevent overpayment of benefits. If the employer does not submit the SR-6 form in a timely manner, the employer will be billed for any overpayment of benefits.

When the employment or contract comes to an end, a TERM-MP should be submitted to notify OPERS that the individual has terminated re-employment. A TERM-MP can be submitted on ECS, under online forms for those who are being reported to OPERS. For individuals who are not reported to OPERS such as independent contractors or an employee who has no earnable salary, the TERM-MP form can be found on www.opers.org under the Employer Section and Forms and Documents. This form is to notify OPERS of the termination of re-employment. In addition, individuals who are reported to OPERS should include a "Q"code on the final contribution report.

Reminder, the SSN lookup under Online Forms on ECS can be used to identify those who are OPERS benefit recipients.

If you have any questions regarding what is required as an employer when someone becomes re-employed, please review the Re-employment Quick Refence Guide.

Employer Education Opportunities

Below is a list of employer education opportunities scheduled for the remainder of the calendar year.

Pick Up Plans

It is possible for employers to defer taxes on employees' retirement contributions. This is known as employer pick-up. Internal Revenue Code Section 414(h)(2) allows employers to make contributions to a qualified pension plan on a tax-deferred basis. Taxes are deferred until an employee receives the contributions as a refund or as retirement benefits.

In one hour, you'll learn the difference between the two types of pick-up plans, the requirements for a plan and how to implement a pick-up plan.

Conversion Plans

Eliminate confusion regarding conversion plans and retirement contribution reporting. This webinar gives you all the information necessary to ensure compliance with your conversion plan.

Earnable Salary

This one-hour seminar will cover which payments qualify as earnable salary (and therefore must be reported to OPERS).

OPERS Membership

This 1-hour course has been approved by the Auditor of State to be used towards completing the education requirements of the Fiscal Integrity Act.

In this course, attendees will learn:

  • OPERS membership as defined in ORC.
  • Who is eligible for OPERS membership?
  • Required forms to be submitted to establish membership.
  • Who is not eligible for OPERS membership?
  • Who should be included on the non-contributing list?
  • How to submit non-contributing list.
  • Webinars: Nov. 15, 2023 – 1 p.m.

Non-Contributing List (NCL)

Employers are required to submit annual Non-Contributing List(s).  The non-contributing information required in the list includes all independent contractors or any other classification besides employee who provided services in the previous calendar year to be included on the non-contributing list.

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It is your responsibility to be certain that OPERS has your current physical and e-mail address on file. If OPERS is not made aware of address changes, we cannot guarantee that you will receive important information pertaining to your OPERS account. This publication is written in plain language for use by public employers who are subject to coverage under the Ohio Public Employees Retirement System. It is not intended as a substitute for the federal or state law, namely the Ohio Revised Code, the Ohio Administrative Code, or the Internal Revenue Code, nor will its interpretation prevail should a conflict arise between it and the Ohio Revised Code, Ohio Administrative Code, or Internal Revenue Code. Rules governing the retirement system are subject to change periodically either by statute of the Ohio General Assembly, regulation of the Ohio Public Employees Retirement Board, or regulation of the Internal Revenue Code. If you have questions about this material, please contact our office or seek legal advice from your attorney. OPERS is not required to provide health care coverage to retirees or their dependents and will only do so at the discretion of the Board of Trustees.