A Notable TRS Bill: New Law on Return to Work

Under previous law, TRS retirees wishing to work for a school district or any other TRS-covered employer faced the loss of retirement pension benefits unless they met the criteria for any of a number of specific exemptions. SB 1669, which was passed by the Texas legislature in May and took effect on June 17, simplifies provisions for such “employment after retirement” or “return to work.”

SB 1669 (by Sen. Robert Duncan, Republican of Lubbock) makes no changes in current provisions concerning work as a substitute or part-time work. The bill also makes no change in required pension and health-care surcharges for retirees who return to work.

Under SB 1669, service retirees who retired before January 1, 2011, may now work full-time for a school district or another TRS-covered employer with no loss of monthly pension annuity benefits. No restrictions apply to these retirees.

For service retirees who retire on or after January 1, 2011, restrictions do apply.  Retirees in this category may now work full-time with no loss of monthly benefits only following a complete break in service of 12 full consecutive calendar months after retirement. The break in service may not include working as a substitute or working part-time for a TRS-covered employer. SB 1669 eliminates the previous list of exceptions to the loss of monthly annuity, including exceptions for acute shortage area, principals, and bus drivers. For those retiring on or after January 1, 2011, working full-time in the absence of the required 12-month break in service will result in the loss of the annuity for the month in which the full-time work occurs.

SB 1669 allows disability retirees who are working on a three-month trial basis to do so even if the three months span more than one school year.

For more details that put the changes made by SB 1669 into the context of other provisions of law affecting return to work that remain unchanged, see the discussion on the TRS Web site at this link: http://www.trs.state.tx.us/global.jsp?page_id=/benefits/ear_legislative_changes.

For instance, this TRS Web site explains:

“Retirees who retired after January 1, 2011, may return to work after serving the required one-full-calendar-month break in service as substitutes and in one-half time positions without forfeiting the monthly annuity. These retirees may work full-time only after serving a 12-full-consecutive-calendar-month break in service. A retiree who returns to work in a full-time position without serving the required 12-full-consecutive-calendar-month break in service forfeits the monthly annuity for each month in which work occurs.

“The new law did not change the requirement that ALL retirees must serve a one-full-calendar-month break in service after retirement before returning to work with a TRS-covered employer. A retiree who returns to work in any capacity without serving the required one-full-calendar-month break in service revokes retirement.”