Employees entering public agency employment and a public retirement system membership for the first time on or after January 1, 2013 are Tier 2 members. A person becomes a member of SJCERA on the first day of employment in a permanent, full-time position with a participating employer.
Retirement Benefits Tier 2
Tier 2 General Member Maximum Formula: 2.5% at age 67 Minimum Retirement Age: Age 52 Tier 2 Safety Member Maximum Formula: 2.7% at age 57+ Minimum Retirement Age: Age 50 Final Compensation Period: Highest 36 consecutive months. Post-Retirement COLA: Up to 3% per year, based on actual changes in CPI 2019 Annual Compensation Limit: * $124,180 (if you pay into Social Security)
$140,016 (if you do not pay into Social Security)
2019 Annual Federal Benefit Limit: ** $225,000
* The Public Employees Pension Reform Act (PEPRA) of 2013 limits the compensation that may be used to calculate retirement benefits for Tier 2 members. You will not pay contributions on earnings in excess of the applicable limit and compensation in excess of the limit will not be used to calculate your benefit. The compensation limits are adjusted annually based on changes in the CPI.
** The Internal Revenue Code Section 415(b) limits the annual benefit amount that SJCERA can pay to a retiree. This limit is based on your age at retirement and is generally lower for members who retire under age 62. However, the benefits of retired employees of sheriff's and fire departments with at least 15 years of service credit and recipients of survivor and disability allowances are not age-adjusted; they are tested against the full 415(b) dollar limit. SJCERA employers have a replacement benefit plan which may pay the difference between the IRC limit and the benefit you have earned.
Pensionable Compensation Tier 2 – Compensation that can be included in the determination of retirement benefits for Tier 2 members excludes:
- Any compensation the Board of Retirement determines was paid to increase a member’s retirement benefit
- “In-kind” compensation or employer payments to third parties that was converted to cash to the member
- Any one-time or ad hoc payment to a member
- Any severance or other payment made in connection with separation from employment but is received by the member while employed
- Payments for unused leave regardless of when reported or paid
- Payments for overtime
- Any employer-provided allowance, reimbursement, or payments including, but not limited to, housing, vehicle, or uniforms
- Employer contributions to deferred compensation or defined contribution plans
- Any bonus
- Any other form of compensation the Board of Retirement finds inconsistent with the definition
Contributions to Retirement Tier 2 -
2019 Member Contribution Rates
General Membership Contribution Rate
Safety Membership Contribution Rate
The amount of compensation used to calculate retirement benefits for Tier 2 Members is limited under the California Public Employees’ Pension Reform Act of 2013 (PEPRA). Tier 2 Members pay contributions on earnings up to the annual PEPRA compensation limit. Member contributions will discontinue once earnings reach annual compensation limits and will resume with the first paycheck issued in the next calendar year.