2701 - CalPERS Contribution Rates and Benefit Formulas
- Employee Relations Officers
- Personnel Officers
- Personnel Transactions Supervisors
- outlines the CalPERS retirement plans offered to state employees
- outlines the state employee contribution rates
- provides information regarding the CalPERS employer contribution rates
- provides information regarding the CalPERS benefit
Generally, state employees working half-time or more are eligible for lifetime retirement benefits administered by the California Public Employee’s Retirement System (CalPERS). The retirement benefits vary and are based on the employees first hire date with the state and CalPERS membership date, as specified in bargaining unit contracts, CalPERS laws, and Public Employee’s Pension Reform Act of 2013 (PEPRA).
The three main sources used to fund CalPERS retirement benefits are from employee retirements contributions, employer contributions, and investment returns. CalPERS is responsible for determining the required retirement contribution rates to ensure retirement benefits are adequately funded. CalPERS, CalHR, and the State Controller’s Office (SCO) provide regular communication to state departments when there are changes to the retirement benefits and contributions. Historically, retirement changes have occurred through the legislative process, or under bargaining agreements between the state and labor organizations.
Departments are legislatively required to enroll eligible employees into CalPERS. This policy provides an overview of retirement information and resources to guide departments.
CalPERS Retirement Plans
A state employee who qualifies for CalPERS membership may be subject to one of five retirement plans based on his or her employment class or position.
- Miscellaneous Tier 1 or 2- Majority of state employees in “administrative” classes and positions.
- Industrial Tier 1 or 2- Employees employed by the California Department of Corrections and Rehabilitation or forensic facilities at state hospitals or developmental centers with classes or positions designated “industrial.”
- State Safety- Employees employed at correctional or forensic facilities at state hospitals or developmental centers in classes or positions designated “state safety” by CalHR.
- Peace Officer/Firefighter- Employees designated “peace officers” under Penal Code (commencing with section 830) and firefighters who perform fire suppression duties.
- Patrol- Employees employed by California Highway Patrol with principle duties consisting of active law enforcement.
Departments should review bargaining unit contracts to identify the appropriate retirement membership or contact CalHR for additional information. Also, refer to SCO “Pay Letters” to obtain enrollment processing procedures at www.sco.ca.gov.
Employee Retirement Contribution Rates
State employees eligible for CalPERS membership are required to pay retirement contributions based on the employee’s retirement plan, bargaining unit, and PEPRA provisions. Historically, SCO will process mass updates for changes to employee retirement contribution rates upon receiving notice from CalPERS and CalHR. Below is a summary of the most current employee contribution rates:
- Miscellaneous Tier 1-(8 percent or 10 percent)
- Miscellaneous Tier 2-(3.75 percent)
- Industrial Tier 1-(8 percent or 9 percent)
- State Safety-(11 percent)
- Peace Officer/Firefighter (13 percent)
- Patrol (11.5 percent)
Departments should refer to the bargaining unit contracts to verify employee contribution rates. Please contact CalHR with any questions related to employee contribution rates.
Employer Retirement Contribution Rates
The employer retirement contribution rates are determined annually by CalPERS actuarial staff and presented to CalPERS Board of Administration (Board) for final approval. Upon final approval by the Board, CalPERS staff will prepare and issue a Circular Letter to notify state employers of the contribution rates each fiscal year.
Retirement Benefit Formulas
State employee retirement benefits vary due to pension reform established in 2010, 2011, and 2013 through bargaining and legislative changes. The retirement benefits are based on the employees first hire date with the state, CalPERS membership date, bargaining unit, and PEPRA provisions.
A summary of the retirement benefits are outlined in each of the bargaining unit contracts. Contact CalHR with any bargaining unit contract inquiries or contact CalPERS to verify CalPERS membership and eligibility information.
SCO Personnel/Payroll: Phone: (916) 445-5361
Fax: (916) 322-6493
CalPERS Customer Service: 888 CalPERS (or 888-225-7377)
TTY: (877) 249-7442
Fax: (800) 959-6545
- Departments are responsible for enrolling eligible state employees and notifying employees of any changes to contributions and benefits.
- Departments should contact SCO regarding enrollment processes and procedures.
- Departments should review bargaining contracts to verify the most current retirement information.
- Bargaining Contracts - MOUs
- California Code of Regulations, title 2, section 553.5
- California Code of Regulations, title 2, sections 575 to 576
- California Code of Regulations, title 2, sections 577 to 578
- Executive Order S-15-10
- Government Code sections 20671 to 20694
- Government Code sections 20710 to 20756
- Government Code sections 20770 to 20776
- Government Code sections 20790 to 20842
- Government Code sections 7522 to 7522.74
- Senate Bill No. 151, chapter 25
- PML 2011-013: PML 2011-013 - 5/9/2011 - Excluded and Exempt Pay Program
- PML 2012-037: PML 2012-037 - 10/31/2012 - California Public Employees' Pension Reform Act of 2013
- PML 2013-021: PML 2013-021 - 7/10/2013 - State Employee Retirement Contribution Rates effective July 1, 2013
- PML 2014-015: PML 2014-015 - 6/20/2014 - Employee Retirement Contribution Rate Increase effective July 1, 2014
- PML 2015-017: PML 2015-017 - 6/11/2015 - CalPERS Second Tier Member Retirement Contribution Increase Effective July 1, 2015
- PML 2016-025: PML 2016-025 - 9/30/2016 - Retirement Contribution Increase for Excluded Employees Affiliated with Bargaining Unit 2
- 2702: State Safety Retirement
- 2703: Peace Officer/Firefighter Retirement (POFF)
- 2704: CalPERS 1959 Survivor Benefit Program
Program Manager, Retirement Policy
Chief (Acting), Benefits Division