Take Action: Rehired annuitants legislation pulled from Assembly committee’s agenda

The Assembly Committee on Local Government was scheduled to hold an executive session yesterday on Assembly Bill 196, legislation that would allow Wisconsin Retirement System retirees to return to work without suspending their annuity. However, the bill was pulled from the committee’s agenda prior to the vote. The committee chairman, Rep. Todd Novak (R-Dodgeville), is a co-author and supporter of the legislation.

The reasoning for this action is unclear but points to potential pushback from others in the Assembly GOP caucus. Two rival bills, which focus solely on law enforcement and firefighters (AB-36) as well as jailers and protective occupations (AB-138) have already passed through their respective committees.

In the Senate, the Committee on Transportation and Local Government held a public hearing for Senate Bill 170, the Senate companion bill to AB 196, on May 6, but has not yet scheduled a committee vote. Ultimately, action is needed in both chambers for this bill to become law. We urge you to contact your state legislators in both the Assembly and Senate and ask them to support the passage of this bill. Read below for provided talking points to assist in your communications.

Under the bill, employers would be required to pay into ETF an amount equal to what the annuitant would have paid had they chosen to forgo their annuity under current law. The bill makes no change to the current law requirement of a 75 day break in service before a retiree can return to work. While the original bill included a 60 month cap on allowing a retiree to return to work while receiving their annuity, an amendment, was introduced by the Assembly authors (at the request of the Dept. of Employee Trust Funds) that removes this cap.

TALKING POINTS

• It offers a practical tool for public employers to fill critical vacancies by rehiring experienced retirees, without compromising the long-term integrity of the WRS.
• Retaining the break in service and requiring contributions to the state retirement fund ensure that positions filled by retirees remain sustainable and that the retirement system remains secure for all members.
• The staffing shortages schools are experiencing are real and urgent.
• This legislation is especially vital for hard-to-fill positions—such as special education, computer science, math, physics, advanced placement, and music.
• Retired educators bring a wealth of experience, deep institutional knowledge, and the ability to step into classrooms immediately, particularly when returning to their former districts. Minimal onboarding is needed, and their impact is felt from day one.
• Other states have already adopted similar measures—recognizing that retired annuitants are a valuable resource for helping address nationwide labor shortages.
• Under current law, retired annuitants can return to private sector employment without giving up their annuity.

AB 196: Rehired annuitants in the Wisconsin Retirement System

Under current law, certain people who receive a retirement or disability annuity from the Wisconsin Retirement System (WRS) and who are hired by an employer that participates in the WRS must suspend that annuity and may not receive a WRS annuity payment until they are no longer in a WRS-covered position. This suspension applies to an annuitant who 1) has reached his or her normal retirement date; 2) is appointed to a position with a WRS-participating employer; and 3) is expected to work at least two-thirds of what is considered full-time employment by the Department of Employee Trust Funds.

 

This bill allows such an annuitant who is hired by a WRS-participating employer as an employee or to provide employee services to not suspend his or her annuity for up to 60 months. The bill also requires WRS-participating employers that hire such annuitants to make payments to ETF equal to what they would have paid as required contributions for each rehired annuitant if the rehired annuitant had suspended his or her annuity. Under the bill, these payments are deposited into the employer reserve account.

 

If the annuitant does not suspend the annuity and does not become an active WRS-participating employee, in the case of state employment, the annuitant is not eligible for group insurance benefits provided to active WRS-participating employees and may not use any of his or her service in the new position for any WRS purposes. If the annuitant opts to again become an active WRS-participating employee, the annuitant is eligible for all group insurance benefits provided to other participating employees and may accumulate additional years of creditable service under the WRS for the new period of WRS-covered employment.

 

The bill also repeals two obsolete provisions related to WRS annuitants returning to WRS-covered employment during the public health emergency declared on March 12, 2020, by executive order 72, which ended on May 13, 2020.