When a "Dual" Member Retires

A "dual" member, that is, someone working in positions covered by more than one NJ State-administered retirement system (e.g., PERS & PFRS, TPAF & PERS, etc.), is permitted by law to retire from one position and receive the pension from that system without affecting the pension enrollment in the second retirement system.

For example, a police officer (PFRS) who also works in a PERS-covered position is a member of both pension funds. If the officer retires and receives a pension based on service under the PFRS position, the PERS membership is not affected and pension credit under the PERS may still be earned.

Public Employees Retirement System (PERS) 

Effect of Postretirement Employment on a PERS Retirement  (See Fact Sheet #21)

Working for private industry, the federal government or a government agency in another state will not normally affect a member’s Public Employees’ Retirement System (PERS) retirement benefits. (See the "Disability Retiree" section below for exceptions to this.) Returning to public employment in New Jersey after retirement, however, could affect retirement benefits, as shown below.

If a PERS Retiree Returns to Work in PERS-covered Position

Mandatory Reenrollment

In addition to the State agencies, over 1800 local employers throughout New Jersey participate in the PERS. A retired member should expect to reenroll in PERS if public employment is accepted and meets the following conditions:

• The employment is on a regular basis and the position is covered by Social Security, and
• The member's aggregate annual compensation (total yearly earnings) from all PERS employing locations exceeds $15,000 (except disability retirees), and
• The employee is not required to be a member of any other New Jersey State or local government retirement system on the basis of the same position; or
• The employee retired on a disability retirement and now earns $1,500 or more a year.

However, a retiree who returns to a covered position cannot join the PERS if any of the following are true:

• The employee's aggregate annual salary (total yearly earnings) from all PERS positions does not exceed $15,000, or $1,499 for those retired on a disability retirement;
• The employee's position is not covered by Social Security;
• The employee is receiving a pension from another NJ State-administered retirement system;
• The employee is receiving a pension from a NJ local or county government pension fund;
• The employee is a seasonal employee; or
• The employee is an elected public official who retired from a public retirement system in this or any other state prior to being elected, and who retired from position(s) other than that of elected official.

Also, enrollment in PERS is optional if the employee is:

• A school crossing guard who is receiving retirement benefits of any kind (including Social Security retirement benefits); or
• An elected official who is receiving a retirement allowance from PERS; he or she may cancel the existing retirement and reenroll if the total yearly compensation from all PERS positions to which he or she is elected or appointed is greater than $15,000 per year.

An employee for whom enrollment is optional, and who decides not to reenroll in the PERS, is entitled to collect a PERS retirement allowance while receiving salary as an elected official or crossing guard.

Finally, a PERS retiree is exempt from reenrollment in the PERS in three instances:

• A PERS retiree who accepts a PERS-covered teaching position at a public institution of higher education (State college or State university) is exempt from reenrolling in the PERS, no matter what the yearly salary earned, for the duration of this employment.
• A PERS retiree who accepts a position with the Department of Education of the State of New Jersey in a position determined to be of critical need by the Commissioner of Education is also exempt from reerollment, regardless of salary or duration of appointment.
• A PERS retiree who accepts a position with a board of education in a position determined to be of critical need by the superintendent of the district is exempt from reenrollment. Such employment taken with a board of education must be on a contractual basis for a period of not more than one year. Upon written request to the PERS Board of Trustees, this contract may be extended for an additional year, but cannot in any case exceed two years with any individual board of education.

Members of any of the State-administered retirement systems in New Jersey who have substantially complied with the requirements necessary to effect a retirement benefit other than a Deferred Retirement, and who become employed again in positions which make them eligible to be members of another retirement system, are not eligible for enrollment in that other system if the subsequent employment was begun on or after the actual retirement date from the first system.

In other words, if a member files for retirement, terminates employment prior to retirement, and starts a new job in a position covered by a different retirement system after the retirement date, the member would not be enrolled in the second retirement system.

Consequences for PERS Retirees

If a member accepts regular full- or part-time employment in a position covered by the PERS, and the total aggregate compensation (total annual earnings) from all PERS positions in which the member is employed is greater than $15,000 per year, the member must reenroll in the PERS as a condition of employment. The retirement allowance will be canceled for the duration of  employment and the employee becomes an active contributing member again. (If over the age of 60, the member must prove insurability to qualify for the group life insurance coverage.) 

If the employee dies while enrolled in the second membership, no benefits from the previous membership or retirement are payable, other than the return of any contributions, plus interest, not already used to pay a retirement allowance. This includes optional settlements and death benefits.

If the member returns to employment under the PERS and is eligible for membership but fails to be enrolled, the member would be required to reimburse the retirement system in the amount of all retirement benefits received since the date enrollment should have occurred. In addition, the employee would be required to pay pension contributions in the form of back deductions back to the enrollment date. You, as the employer, may also be liable for pension and Social Security contributions. There is no limitation on the amount of reimbursement that may be recovered by the retirement system in these situations.

Retiring from a Second Membership

When a PERS member retires again, a new retirement application must be filed, so that the first allowance may be restored. A second allowance will be calculated based on the second membership. Both allowances are paid in the same retirement check. The first and second accounts cannot be combined to qualify for a Veteran Retirement. Service credit from the first and second account may be combined to qualify for enhanced benefits, i.e. 25 years, etc. You, as the employer should be able to tell members whether any employment they are considering is covered under the PERS.

Returning to Work in a Position Covered by Another New Jersey State-administered Retirement System

In this case the member’s retirement allowance continues, and the member can receive salary, but cannot become a member of that system.

Disability Retirees Restored to Active Service in the PERS

Before a disability retiree can return to active service in a PERS-eligible title, the following procedures must be followed. The member must:

1. Make a request to the Division of Pensions and Benefits in writing of the desire to return to employment.
2. Submit a physician’s report to the Division certifying that he or she is no longer disabled and can return to employment. The physician should be one with the same specialty as the physician who originally certified that the member was disabled.
3. Be examined by a physician appointed by the PERS Board of Trustees.
4. Be approved for return to active service by the PERS Board of Trustees.

When a disability retiree returns to active service and earns an annual salary of $1,500 or more, an enrollment application must be submitted to the Division. In this case, the original membership resumes, and the balance of contributions in the account is prorated by the retirement benefit already paid.

Teachers' Pension and Annuity Fund (TPAF) 

Effect of Postretirement Employment on TPAF Retirees  (See Fact Sheet #28)

Working for private industry, the federal government or a government agency in another state will not normally affect a member’s TPAF retirement benefits. (See the "Disability Retiree" section below for exceptions to this rule.)

Returning to public employment in New Jersey after retirement could affect retiree benefits.

Returning to Work in a Position Covered by the TPAF

A TPAF retiree who accepts regular full-time or part-time employment in a position covered by TPAF must reenroll in the pension fund. There are significant consequences to reenrollment, as discussed below.

Mandatory Reenrollment

Membership in TPAF is required as a condition of employment if:

• The employee is appointed to a permanent teaching or professional staff position requiring certification and is employed on a regular basis (including per diem and hourly positions) in a position covered by Social Security, and
• The employee’s annual salary is $500 or more;
• A TPAF retiree is employed or accepts employment in a TPAF-eligible position as an interim employee—except for those who fall under the reenrollment exemption for certificated administrators and superintendents—regardless of the length of service with an employer. *

*Prior to November 3, 2003, local school boards were permitted to appoint a retired Teachers' Pension and Annuity Fund (TPAF) member to any TPAF-covered position on an interim basis—for up to six months—without affecting the individual's retirement allowance, under the rule N.J.A.C. 17:3-2.6. On October 2, 2003, the Teachers' Pension and Annuity Fund Board of Trustees repealed this rule—except for the reenrollment exemptions explained below.

Finally, a TPAF retiree is exempt from reenrollment in the TPAF in two instances:

• A TPAF retiree who is a certificated administrator or a certificated superintendent may accept a certificated position with the Department of Education of the State of New Jersey without reenrollment, as long as the position is determined to be of critical need by the Commissioner of Education. There are no earnings or duration limits upon such appointments.

• A TPAF retiree who is a certificated administrator or a certificated superintendent who accepts a certificated administrator position or a certificated superintendent position (respectively) with a board of education in a position determined to be of critical need by the superintendent of the district, is exempt from reenrollment. Such employment taken with a board of education must be on a contractual basis for a period of not more than one year. Upon written request to the TPAF Board of Trustees, this contract may be extended for an additional year, but cannot in any case exceed two years with any individual board of education.

If a member collecting retirement benefits from the TPAF, other than a disability retirement, accepts employment in a position covered by the TPAF, the following steps should occur:

You, as the employer, must submit a TPAF Enrollment Application on the member’s behalf to the Division of Pensions and Benefits.

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Consequences of Reenrollment

The employee’s application will be referred to the Board of Trustees of the retirement system to cancel the member’s retirement allowance as of the required date of enrollment in TPAF. The date of enrollment is not negotiable. The TPAF Board Secretary will advise the employee of the action taken by the Board.

Once the Board of Trustees cancels the member’s retirement allowance, the TPAF Enrollment Application will be processed and a certification to deduct pension contributions will be sent to you.

The member will be billed for any retirement payments received after the effective date of their new TPAF enrollment.

Because of the sequence of events, most retirees are enrolled in the TPAF on a retroactive basis. They should therefore anticipate that they would be required to refund one or more pension checks to the retirement system.

Retiring for the Second Time

The member must file an application for retirement when the time comes to retire for the second time. The former retirement allowance and any option selection will be restored along with any appropriate cost-of-living adjustment payable based upon the original date of retirement. In addition, the member will receive a retirement allowance based upon the new period of service. Service credit from both retirements may be combined to satisfy the 25 years of service requirement for TPAF paid State Health Benefits Program coverage. (Note: Any additional allowance due as a result of the second period of service will be determined under the Service Retirement formula; a reduction applies if the retiree is under age 55.) By law, the combined retirement allowances cannot be greater than the allowance that would have been received if the first retirement had not occurred.

You, as the employer, should be able to tell if the employment the member is considering is covered by the TPAF.

Returning To Work in A Position Covered by Another New Jersey State-administered Retirement System

In this case, the member’s retirement allowance continues, salary can be earned, but the member cannot enroll in that system.

Disability Retirees Restored to Active Service

Before a disability retiree can return to active service in a TPAF-eligible title, the following procedures must be followed. The disability retiree must:

1. Make a request to the Division of Pensions and Benefits in writing.
2. Submit a physician’s report to the Division certifying that he or she is no longer disabled and can return to employment. The physician should be one with the same specialty as the physician who originally certified that the members was disabled.
3. Be examined by a physician appointed by the TPAF Board of Trustees.
4. Be approved for return to active service by the TPAF Board of Trustees.

When a disability retiree returns to active service and earns an annual salary of $500 or more, an enrollment application must be submitted to the Division. In this case, the original membership resumes and the balance of contributions in the account is prorated by the retirement benefit already paid.

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Police and Firemen’s Retirement System (PFRS)

Effect of Postretirement Employment on Retirement  (See Fact Sheet #29)

With the exception of those retiring under a disability retirement, there are no restrictions concerning employment after retirement from the PFRS if the retiree takes employment in private industry, the federal government, or public employment in a state other than New Jersey.

Returning to Work in a Position Covered by the PFRS

If a member returns to employment in a permanent position covered by the PFRS, the individual must cancel his or her retirement and reenroll in the PFRS.

Mandatory Reenrollment in the PFRS

All eligibility requirements must be met except the age requirement. The member becomes an active member again.

Consequences for PFRS Retirees

If the member dies while in the second membership, no benefits from the previous membership or retirement are payable.

Retiring from a Second Membership

When members retire from their second position, they must file a retirement application so that their first retirement allowance will be restored and a second allowance from the second membership will be calculated and paid in the same retirement check. By law, the combined retirement allowances cannot be greater than the allowance that would have been received if the first retirement had not occurred.

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Returning to Work in a Position Covered by a Different New Jersey State-administered Retirement System

In this case, the member’s retirement allowance continues intact and the retiree can receive salary but cannot become a member of that retirement system.

A Cautionary Note: Service in appointed, administrative or supervisory positions within six months of retirement, such as Police Director, Fire Director, Director of Public Safety, and others, may be PFRS-eligible titles, if occupied by a PFRS member. (As per NJSA 43:16A-3.1)

Care should be taken to ensure a PFRS retiree is not hired to a PFRS-covered position.

Disability Retirees Returning to Work

Before a disability retiree can return to active service in a PFRS-eligible title, the following procedures must be followed. The disability retiree must:

When a disability retiree returns to active PFRS service, an enrollment application must be submitted to the Division. In this case, the original membership resumes and the balance of contributions in the account is prorated by the retirement benefit already paid.