School Districts Must Report All Grandfathered CBAs and Employment Contracts to TRS by March 29, 2019

All TRS Employers are required to submit their “grandfathered” CBA and employment contract information online to TRS using a new CBA/Contract Collection Portal (“Portal”) by March 29, 2019. According to TRS, if the required information is not received by TRS, any year-over-year salary increases in 2018-19 and future years above 3% will be subject to a TRS excess salary contribution if those increases are used in calculating the member’s final average salary upon retirement.

On February 4, 2019, the Teachers’ Retirement System of Illinois (“TRS”) released Employer Bulletin 19-12 announcing activation of a new Portal within the Employer Access Area of the TRS website for school districts to enter information regarding Collective Bargaining Agreements and Employment Contracts that school districts consider “grandfathered” from the new 3% salary threshold.

This reporting system was designed to assist TRS and employers administer Public Act 100-0587, which was signed into law June 4, 2018. Under that law, an employer may owe an excess salary contribution to TRS for a member who was granted an increase in TRS creditable earnings on or after July 1, 2018, in excess of 3% over the previous year’s creditable earnings – if the resulting higher creditable earnings are used to determine the member’s final average salary upon retirement. Prior to the effective date of the new law, the excess salary threshold triggering the excess salary contribution for an employer was a 6% increase.

The law, however, contains a “grandfather” clause that applies the prior 6% threshold (rather than the new 3%) on raises after July 1, 2018, if the raise was authorized under a CBA or individual employment contract entered into, amended or renewed prior to June 4, 2018 (certain limitations apply). The grandfather protection could be lost if school districts and other TRS employers do not file their grandfathered contracts with TRS using its new Portal. The Employer Bulletin can be found at https://www.trsil.org/sites/default/files/documents/1912.pdf .

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