CalPERS – Pensionable Compensation for New Members


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The purpose of this Circular Letter is to inform CalPERS contracting employers of the adoption of section 571.1 to title 2 of the California Code of Regulations (C.C.R.), which further clarifies what CalPERS considers to be “pensionable compensation” as defined in Government Code (G.C.) section 7522.34. This Circular Letter supersedes and replaces Circular Letter No. 200-062¬12 dated December 27, 2012, as it applies to “pensionable compensation.” For new members, as defined in subdivision (f) of G.C. section 7522.04, “pensionable compensation” must meet the following four criteria set forth in subdivision (a) of both G.C. section 7522.34 and C.C.R. section 571.1: 1. Pay is the normal monthly rate of pay or base pay that is earned for normally required duties and historically consistent with prior payments for the job classification. 2. Pay is paid in cash to similarly situated members of the same group or class of employment. 3. Pay is for services rendered on a full-time basis during normal working hours. 4. Pay is paid pursuant to publicly available pay schedules. The following forms of compensation are not reportable for PEPRA new members: 1. Temporary Upgrade Pay. 2. Management Incentive Pay. 3. Uniform Allowance. 4. Bonus 5. Value of Employer Paid Member Contributions (EPMC). 6. Off-Salary-Schedule Payments. Additionally, we would like to clarify the following forms of compensation as they relate to PEPRA new members: FLSA is only reportable for safety members. Holiday Pay: For employees with written labor agreements providing holiday credit and allowing employees to cash out accumulated holiday credit, the cash out must be done at least annually and reported in the period earned.