Employer Manual
Revised:
Under Kansas law, KPERS membership is mandatory for any employee in a “covered” position. It is a condition of employment. “Covered” means the position is eligible for KPERS benefits.
Position Requirements
*Employees not performing the regular duties of their KPERS-covered position do not earn service credit. This includes employees on sabbatical, extended leave of absence, or serving as a representative, delegate or officer of a union or similar employee organization. Simply remaining on the employer’s payroll is not enough to qualify for KPERS service credit.
It’s critical to track the hours an employee works. Carefully monitor temporary and seasonal employees and those working less than 1,000 hours. An employee hired in a non-covered position now might be in a covered position later, due to a change in position or job responsibilities.
YES: The position is at least 1,000 hours a year (e.g., four hours a day) and meets the other requirements.
NO: An employee works over 1,000 hours, but only during the spring and summer mowing, etc. This is seasonal.
NO: Someone is hired to do a special project that lasts only a few months. This is a temporary position.
NO: Someone works an hour or two each day. This position is not covered. But monitor hours. If he or she consistently works at least four hours per day, you need revisit your position description for this job. If the employee continues to work four or more hours, you need to enroll the employee in KPERS.
Whether a worker is an employee or an “independent contractor” is a federal tax issue. It is your responsibility to determine if an individual performing services is an independent contractor or employee. If the worker is considered an employee by the IRS and the position meets KPERS membership requirements, the person must be enrolled as a KPERS member.
The IRS has created tests to determine whether a worker is an independent contractor or an employee. Test factors are grouped into three categories:
The test includes questions like: What training is required? Who hires, supervises and pays for assistants? Who determines the individual’s hours? Will the individual work on the employer’s premises? Who supplies tools and materials? Does the employer control how results are achieved? Does the worker have an opportunity to make a profit or take a loss? Does the worker have employee benefits like health insurance and paid vacation?
If the employer controls the worker in largely the same way the employer controls employees, then the worker is most likely not an independent contractor according to the IRS. If you hire someone you consider an independent contractor, we recommend you consult an attorney or your normal source for guidance on payroll withholding and tax matters. See IRS publication: Independent Contractor or Employee?
Generally, classified employees become KPERS members and unclassified employees become members of the Kansas Board of Regents Mandatory Retirement Plan.
Employer Manual: Kansas Board of Regents (KBOR)
Employees working at a Board of Regents institution who are transferred or reclassified to a job covered by the other retirement plan have a one-time chance to stay in the plan they’ve been in. Employees transferring to a KBOR institution from another State agency also have this choice.
To stay in the retirement plan they had before reclassification or transfer, employees complete an Retirement Plan Election for Kansas Board of Regents Employees form (KPERS-3BOR). KPERS must receive the form before the first day of the first complete payroll period after the reclassification or transfer. Employees who do not submit this form are considered as electing to participate in the retirement plan provided by the position they are transferring to or being reclassified to.
The election is irrevocable unless the member ends employment and:
Employees cannot contribute to the KBOR Mandatory Retirement Plan and KPERS at the same time. KPERS members won’t receive credit for any service during which they are enrolled in the Regents mandatory plan.
Employees can contribute to the Regents voluntary plan and KPERS at the same time.
Issued by U.S. Citizenship and Immigration Services (USCIS), a Permanent Resident Card – commonly known as the “Green Card” – gives immigrants the legal right to live and work in the United States. A covered employee with a green card is a KPERS member.
Employees with work visas
Yes: Foreign workers on a visa (except J-1 or F-1) who have an SSN.
No: Employees with a J-1 or F-1 visa.
KPERS-affiliated Community Developmental Disability Organizations (CDDOs) and Community Service Providers have the option to defer KPERS membership for two years for trainees hired in direct-support positions. Click here for more info.
An employee is not a member if he or she is:
KPERS has three statewide retirement systems: 1) Kansas Public Employees Retirement System (KPERS); 2) Kansas Police and Firemen’s System (KP&F); 3) Kansas Retirement System for Judges (Judges).
In the KPERS plan, there are three benefit structures: KPERS 1, KPERS 2, and KPERS 3*. In the KP&F plan, there are two benefit structures: KP&F Tier I and KP&F Tier II.
*All new employees hired in KPERS-covered positions should be enrolled in KPERS 3.
Hint: When you enroll employees on the employer web portal, the system will tell you in which benefit structures they should be enrolled.
Grace Period Non-vested members have a 30-day grace period between KPERS-covered employment.
Note: Julie works for the City of Atchison and is a KPERS 2 member with three years of service. Julie ends employment with the City and goes to work for the Kansas Department of Revenue three weeks after her last day at the City. Julie is within the grace period and continues as a KPERS 2 member.
If Julie had ended employment with the City and not gone to work for another KPERS employer within 30 days, she would become a KPERS 3 member.
Correctional members work for a State correctional facility. They are divided into two groups for KPERS benefits, Group A and Group B, as determined by the Department of Corrections. Correctional members can be KPERS 1 or KPERS 2 just like regular KPERS members. They make the same contributions and have the same benefits. However, they may be able to retire at an earlier age if they meet Correctional retirement eligibility requirements. Unlike other new employees, new correctional employees will still become KPERS 2 members.
County commissioners, city commissioners and city council members are eligible for KPERS.
Requirements:
Elected officials can choose whether to become KPERS members. This choice is irrevocable. Once the choice has been made, the elected official cannot revoke the decision while in office. Use Elected Official Election of Membership (non-legislative) form KPERS-3.
Expectation - An elected official who is already a KPERS member by virtue of his or her "day job" is required to be a member if the elected position meets membership requirements. The member will be a "dual" employee. See Working for More Than One Employer. This applies only to non-legislative elected official positions. Inactive membership does not count for this requirement. The person needs to be an active member to be required.
Elected officials who don’t originally opt in to KPERS have another opportunity to choose membership if they are elected to office after a break in service.
Example: Mary was elected a city council member and chose not to join KPERS. Years later she was elected as a county commissioner. She has the chance become a KPERS member with her new elected office.
Legislators have a one-time choice whether to participate in KPERS. They need to opt in or out by completing a KPERS Membership and Death and Disability Coverage (for Legislators) form (KPERS-3A) within 90 days of taking the oath of office. This choice is irrevocable. Once the choice has been made, the elected official cannot revoke the decision while in office.
Complete KPERS-3A regardless of whether the elected official chooses to become a KPERS member. Legislators who do not choose KPERS membership are still covered by death and disability benefits.
Membership date is oath-of-office date or date appointed if KPERS receives the KPERS-3A form within 14 days after that date. If KPERS doesn’t receive the form within 14 days, the membership date is the first day of the payroll period of the first quarter after KPERS receives the form. However, it must be within 90 days of the oath of office.
Elected officials who don't originally opt in to KPERS have another opportunity to choose membership if they are elected to another office.
Example: John was elected to the House of Representatives and chose not to join KPERS. Late he was elected as a State Senator. He has the chance to become a KPERS member with his new elected office.
KPERS retirees who are now legislators cannot participate in KPERS as active members. They can choose to have their employer contribute to the State’s Deferred Compensation Plan (KPERS 457) on their behalf by completing an Election of Deferred Compensation Plan for KPERS Retirees (Legislators) form (KPERS-3R).
State officers, unclassified employees on the Governor’s staff and any unclassified employee on the staff of both houses of the Legislature can choose the State’s Deferred Compensation Plan (KPERS 457) instead of KPERS.
Positions included: Secretary of Administration, Secretary on Aging, Secretary of Commerce, Secretary of Corrections, Secretary of Health and Environment, Secretary of Human Resources, Secretary of Revenue, Secretary of Social and Rehabilitation Services, Secretary of Transportation, Secretary of Wildlife and Parks, Superintendent of the Kansas Highway Patrol, State Grain Inspector, Executive Director of the Kansas Lottery, Executive Director of the Kansas Racing Commission, President of Kansas Development Finance Authority, State Fire Marshal, State Librarian, Securities Commissioner, Adjutant General, members of the State Board of Tax Appeals, members of the Kansas Parole Board, members of the State Corporation Commission, any unclassified employee on the staff of officers of both houses of the Legislature, and any unclassified employee appointed to the Governor’s staff.
If the employee chooses KPERS, do a regular enrollment on the EWP. To opt out of KPERS, employees use a State Officer Retirement Plan Election form (KPERS-3S). Instead of contributing to KPERS, employers contribute 8 percent of gross compensation to the employee’s deferred comp account. If, at a later time, employees become KPERS members in another position, the years spent in the deferred comp plan cannot be purchased as KPERS service credit.
Note: Employees who opt out of KPERS are still covered by death and disability insurance.
Totality of employment affects a member when he or she is paid for working extra jobs with the same employer (e.g., lawn work, janitorial work, etc.). A member working in a KPERS-covered position must have contributions deducted from all pay earned from all work with the same employer.
While this increases a member’s salary, it doesn’t add additional service credit. By law, members can earn only one calendar quarter of service credit for any employment within any quarter.
State AgenciesAll State of Kansas agencies, including Board of Regents institutions, are considered one employer. An employee at one State agency in a covered position who also works in a non-covered position for the same or another State agency must have contributions withheld from pay for all positions.
Example 1: Sue works for the Kansas Department of Transportation in a fulltime covered position. During tax season, she also works part time at the Kansas Department of Revenue. Both employers should deduct member contributions from her pay and both employers should also remit employer contributions.
Example 2: Sue works for KDOT in a full-time covered position. She also works part time in the summer for the City of Topeka. Because they are different employers and the city job is not covered, only KDOT should remit contributions.
Dual membership is when an employee works for two or more KPERS employers and all positions have KPERS benefits.
Each employer submits an enrollment. The employee’s membership date is the one established with the first employer.
Both employers deduct member contributions. Both employers make employer contributions. If an employee is purchasing service credit by payroll deduction, KPERS buyback contributions will be deducted by each KPERS employer. Dual employment will increase the member’s salary, but won’t add additional years of service credit. By law, members can earn only one calendar quarter of participating service credit for any employment within any quarter.
Dual employment is not working in a covered position at one employer and in a non-covered position with another employer. Dual employment can be working at a non-school employer and at a school employer, as long as both positions are eligible for KPERS benefits.
Example 1: Dan works 1,000 hours a year with the City of Topeka. He also works 1,000 hours a year with Shawnee County. Both positions meet KPERS eligibility requirements. He is a member at both employers. Contributions are made on both salaries.
Example 2: Dan works 1,000 hours a year with the City of Topeka. He also works 500 hours a year with Shawnee County. Only the city position meets KPERS eligibility requirements. Only the City of Topeka enrolls him and deducts contributions.
State agencies
All State of Kansas agencies, including Board of Regents institutions, are considered one employer. See Working Extra Jobs at the Same Employer.
Totality of employment affects a member when he or she is paid for working extra jobs with the same employer (e.g., lawn work, janitorial work, etc.). A member working in a KPERS-covered position must have contributions deducted from all pay earned from all work with the same employer.
While this increases a member’s salary, it doesn’t add additional service credit. By law, members can earn only one calendar quarter of service credit for any employment within any quarter.
When employees move from a covered position to a non-covered position, they stop making contributions and earning service credit. They are no longer eligible for disability coverage or group life insurance. Submit an end date for their employee record in the EWP using “Non-covered” as the reason. The system automatically generates a “non-covered” employee record. Quick Vid: End Date
While officially considered “inactive,” these members can’t withdraw contributions because they are still employed by a KPERS employer. This includes employees moving from a KPERS-covered position to one covered by the Regents Mandatory Retirement Plan. They can withdraw contributions when they end employment.
If this person returns to a covered position, enter an end date in the non-covered record with a “Return to payroll” reason. If the person ends employment in the covered position, enter an end date with “Termination” reason.
Enter an end date in his or her record to end leave of absence, military leave or disability. Use “Return to payroll” as the reason.
Generally speaking if the employee has continued optional group life insurance, it will be reinstated when the employee returns to work.
For returning active military, they are eligible to reinstate their previous optional life insurance if they had it through your employer when they left and return within 5 years. Also, they may be eligible for granted or purchased service. See Service Credit.
Waiting period (working after retirement)
KPERS: Age 62+ = 60 days | KPERS: Under age 62 = 180 days | KP&F: 30 days
To calculate the waiting period, count the day after the retirement date as day one. This is their Retirement System retirement date, not their last day on payroll.
Membership date is the date an employee becomes a member. Purchasing service credit doesn’t change it. Rules and benefits are sometimes affected by membership date.
Years of service
Before July 1, 2009, new non-school employees worked for one year in a KPERS covered position before becoming a member. This was called their “year of service.” Their membership date is not the same as their hire date. KPERS 1 members can purchase this service, even if it is only a partial year.
If an employee appears to be retroactively eligible for KPERS:
In addition to enrolling the employee, past contributions are also due. KPERS will collect them as part of the adjustment process.
| Error Reported | Who Pays Past Contributions |
|---|---|
| Within six months of membership date | Member |
| More than six months past membership date | Employer |
Complete a Member Payroll Department Change form (KPERS-11) to change a member's payroll department number, only.
Complete a Request for Member Information Change form (KPERS-12) to change or correct a member’s other personal information record (not including payroll department number). You’ll need to include a copy of the appropriate documentation that reflects the new or corrected information. See the form for details.
Both active members and employers contribute to KPERS
| KPERS 1 | KPERS 2 | KPERS 3 | Judges | KP&F |
| 6% | 6% | 6% | 6% | 7.15% |
Contribution rates are set by Kansas law. Contributions are made on gross pay from each pay period on a pretax basis. See Quick Vid: Pay Report.
Member contributions are credited to the member’s account under his or her name and Social Security number. Kansas law does not allow members to borrow from their KPERS account.
Contributions are not included in the employee’s income for federal income tax, but are included for Kansas state income tax purposes. Employees need to make a specific entry on their Kansas income tax return. Some employers provide this amount in Box 14 on the W-2 form (labeled KPERS).
KPERS 1 and KPERS 2 interest is credited annually on June 30, based on the account balance for the previous December 31 (e.g., interest credited June 30, 2018, is based on account balance as of December 31, 2017). KPERS 3 interest is credited quarterly
Vested members who leave employment continue to earn interest. Non-vested members earn interest for five years but must withdraw their money after five years (two years for KPERS 3 members) unless working in a non-covered position.
For KPERS 1 and KPERS 2 members, account balance has no effect on retirement benefits, which are determined by final average salary and years of service. Account balance is only important if a member withdraws or dies before retirement.
For KPERS 3, retirement benefits are affected by a member’s account balance.
Employer contribution rates can change annually based on actuarial calculations. The legislature governs how much they can increase. Rates are the same for KPERS 1, KPERS 2 and KPERS 3. Employer contributions rates.
Contributions are based on gross compensation before any deductions. They are not deposited into members’ accounts.* They stay with KPERS to fund the System even if members end employment.
Contributions are paid to KPERS each pay period through the employer web portal. See Quick Vid: Pay Report.
Employees earn service credit working in a covered position. Kansas law governs other types of service that can be purchased or granted. See Service Credit.
All active KPERS members vest with five years of service. A total of 18 quarters (4.5 years) rounds to five years of service. If members have service credit in one of the other retirement plans (KP&F and Judges), they can combine service to vest in KPERS. This is called “portability” (not to be confused with portability of group life insurance). Please contact KPERS with questions.
Benefits of vesting
Vested members need to keep their contributions with KPERS after leaving employment to be eligible for account interest and retirement. Non-vested members who leave employment must withdraw their money after five years (two years for KPERS 3 members) unless working in a non-covered position or they return to work in a KPERS covered position within the five year period. Vesting does not mean a member has claim on employer contributions.