When submitting Employment after Retirement (ER) reports, each report month should contain the actual days and hours worked by a retiree within that calendar month and the actual pay that was issued during that calendar month. Reporting Entities (REs) should not report the number of days and hours based on the pay period but rather based on the time worked in the actual month. Keep in mind that the time worked must also include any paid leave taken by the retiree.
For retirees that retired after Sept. 1, 2005, they must adhere to the EAR limits at all employers each calendar month, or surcharges will be due. Below are some examples of different employments and when surcharges would be due.
Retirement Date: May 31, 2018
- Retiree Mary S. has returned to work as a substitute only in nonvacant positions.
- This complies with the EAR Limits and surcharges will not due if this is her only employment.
Using Mary S. from example 1 with a May 31, 2018 retirement date.
- Mary was hired to substitute in a vacant position and can work as a substitute in this position up to 20 days. However, Mary works 23 days in this position during the month of October 2026, which exceeds the allowable 20-day exception.
- In this case, the first 20 days would be considered a substitute position, and the three remaining days would be considered half-time or less in the vacant position.
On the ER20, the employment type for the month of October 2026 would need to be reported as “C - Combination of Substitute and Half-time or less” and 23 days.
Exceeding 11 days in combined positions in the report month will cause the surcharges to be due.
Retirement Date: Dec. 31, 2022
- Retiree John J. has returned to work one-half time or less and works up to 92 hours each month.
- This is complying with the EAR Limits and surcharges will not be due if this is his only employment.
Using John J. from example 3:
- John works 92 hours at Employer 1.
- At Employer 2, the retiree works a total of 12 hours in a one-half time or less position.
- In this case, the total hours for the month would be 104 hours which exceeds the allowable hours for the report month.
- Surcharges would be due from both employers. The pension surcharge would be 16.5% of the compensation paid to the retiree in the report month. If the retiree is subject to the TRS-Care surcharge, this would be split between the two employers ($267.50 each).
Passing the Cost of Surcharges
Surcharges are additional contributions that must be paid to TRS on employed TRS retirees who retired after Sept. 1, 2005 and who work more than one-half time during a month. House Bill 2 (89th Texas Legislative Session), repeals the prohibition that public education employers are prohibited from directly or indirectly passing the costs of pension and applicable health care surcharges for retirees returning to work full time.