1.1 	A bill for an act
1.2 	relating to state employment; creating a
1.3 	postretirement employment option; authorizing a
1.4 	voluntary hours reduction plan.
1.5 	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

1.6 	Section 1. DEFINITION.
 1.7 	For purposes of sections 2 and 3, "state employee" means a
1.8 	person currently occupying a civil service position in the
1.9 	executive branch of state government, the Minnesota State
1.10 	Retirement System, or the Office of the Legislative Auditor.

1.11 	Sec. 2. POSTRETIREMENT OPTION.
 1.12 	(a) This section applies to a state employee who:
1.13 	(1) for at least the five years immediately preceding
1.14 	separation under clause (2), has been regularly scheduled to
1.15 	work 1,044 or more hours a year in a position covered by a
1.16 	pension plan administered by the Minnesota State Retirement
1.17 	System;
1.18 	(2) terminates state employment;
1.19 	(3) at the time of termination under clause (2), meets the
1.20 	age and service requirements necessary to receive an unreduced
1.21 	retirement annuity from the plan and satisfies requirements for
1.22 	the commencement of the retirement annuity or, for an employee
1.23 	under the state unclassified employees retirement plan, meets
1.24 	the age and service requirements necessary to receive an
1.25 	unreduced retirement annuity from the plan and satisfies
2.1 	requirements for the commencement of the retirement annuity or
2.2 	elects a lump-sum payment; and 
2.3 	(4) agrees to accept a postretirement option position with
2.4 	the same or a different appointing authority, working a reduced
2.5 	schedule that is both (i) a reduction of at least 25 percent
2.6 	from the employee's number of regularly scheduled work hours;
2.7 	and (ii) 1,044 hours or less in state service.
2.8 	(b) Notwithstanding any law to the contrary, postretirement
2.9 	option positions shall be in the unclassified service but shall
2.10 	not be covered by the Minnesota State Retirement System
2.11 	unclassified employees plan.
2.12 	(c) Notwithstanding any law to the contrary, when an
2.13 	eligible state employee in a postretirement option position
2.14 	commences receipt of the annuity, the provisions of Minnesota
2.15 	Statutes, section 352.115, subdivision 10, governing annuities
2.16 	of reemployed annuitants, shall not apply for the duration of
2.17 	employment in the position.
2.18 	(d) The appointing authority has sole discretion to
2.19 	determine if and the extent to which a postretirement option
2.20 	position under this section is available to a state employee.
2.21 	Any offer of such a position must be made in writing to the
2.22 	employee by the appointing authority on a form prescribed by the
2.23 	Department of Employee Relations and the Minnesota State
2.24 	Retirement System.  The appointing authority may not require a
2.25 	person to waive any rights under a collective bargaining
2.26 	agreement or unrepresented employee compensation plan as a
2.27 	condition of participation.
2.28 	(e) Postretirement option employment shall be for an
2.29 	initial period not to exceed one year.  During that period, the
2.30 	appointing authority may not modify the conditions specified in
2.31 	the written offer without the employee's agreement, except as
2.32 	required by law or by the collective bargaining agreement or
2.33 	compensation plan applicable to the employee.  At the end of the
2.34 	initial period, the appointing authority has sole discretion to
2.35 	determine if the offer of a postretirement option position will
2.36 	be renewed, renewed with modifications, or terminated.
3.1 	Postretirement option employment may be renewed for periods of
3.2 	up to one year, not to exceed a total duration of five years.
3.3 	No person shall be employed in one or a combination of
3.4 	postretirement option positions under this section for a total
3.5 	of more than five years.
3.6 	(f) The appointing authority shall provide the Minnesota
3.7 	State Retirement System with a copy of the offer, the employee's
3.8 	acceptance of the terms, and any subsequent renewal agreement.
3.9 	(g) Notwithstanding any law to the contrary, a person may
3.10 	not earn service credit in the Minnesota State Retirement System
3.11 	for employment covered under this section, and employer
3.12 	contributions and payroll deductions for the retirement fund
3.13 	must not be made based on earnings of a person working under
3.14 	this section.  No change shall be made to a monthly annuity or
3.15 	retirement allowance based on employment under this section.
3.16 	(h) Notwithstanding any law to the contrary, the appointing
3.17 	authority will make an employer insurance contribution for a
3.18 	person who is employed in a postretirement option position under
3.19 	this section and who is not receiving any other state-paid
3.20 	employer insurance contribution.  The amount of the contribution
3.21 	will be equal to the percent time worked in the postretirement
3.22 	option position (hours scheduled to be worked annually divided
3.23 	by 2,088) times 1.5 times the full employer contribution for
3.24 	employee only health and dental coverage.  The appointing
3.25 	authority will contribute that amount to a health reimbursement
3.26 	arrangement.
3.27 	(i) If a person has been in a postretirement option
3.28 	position and accepts any other position in state service, in the
3.29 	subsequent state employment the person may not earn service
3.30 	credit in the Minnesota State Retirement System, no employer
3.31 	contributions or payroll deductions for the retirement fund
3.32 	shall be made, and the provisions of Minnesota Statutes, section
3.33 	352.115, subdivision 10, shall apply.

3.34 	Sec. 3. VOLUNTARY HOURS REDUCTION PLAN.
 3.35 	(a) This section applies to a state employee who:
3.36 	(1) is regularly scheduled to work 1,044 or more hours a
4.1 	year in a position covered by a pension plan administered by the
4.2 	Minnesota State Retirement System; and 
4.3 	(2) enters into an agreement with the appointing authority
4.4 	to work a reduced schedule of 1,044 hours or less in the covered
4.5 	position.
4.6 	(b) Notwithstanding any law to the contrary, for service
4.7 	under an agreement entered into under paragraph (a),
4.8 	contributions may be made to the applicable plan of the
4.9 	Minnesota State Retirement System as if the employee had not
4.10 	reduced hours.  The employee must pay the additional employee
4.11 	contributions and the employer must pay the additional employer
4.12 	contributions necessary to bring the service credit and salary
4.13 	up to the level prior to the voluntary reduction in hours.
4.14 	Contributions must be made in a time and manner prescribed by
4.15 	the executive director of the Minnesota State Retirement System.
4.16 	(c) The appointing authority has sole discretion to
4.17 	determine if and the extent to which voluntary hours reduction
4.18 	under this section is available to an employee.  The number of
4.19 	hours to be worked per pay period and the end date of the
4.20 	voluntary hours reduction arrangement must be agreed to, in
4.21 	writing, by the employee and the appointing authority.  Either
4.22 	the appointing authority or the employee may terminate the hours
4.23 	reduction arrangement prior to the end date with 30 days'
4.24 	written notice to the other.  The appointing authority shall
4.25 	provide the Minnesota State Retirement System with a copy of the
4.26 	agreement and any termination notice.
4.27 	(d) Implementation of the voluntary hours reduction
4.28 	arrangement or of any change required by the termination of an
4.29 	arrangement is subject to provisions of the applicable
4.30 	collective bargaining agreement or unrepresented employee
4.31 	compensation plan.  The appointing authority may not require a
4.32 	person to waive any rights under a collective bargaining
4.33 	agreement or unrepresented employee compensation plan as a
4.34 	condition of participation under this section.
4.35 	(e) No person shall be employed in one or a combination of
4.36 	voluntary hours reduction arrangements under this section for a
5.1 	total of more than three years.