Senate Bill 765 – Amends Existing Law Related To Retiree Compensation Limitations

CATEGORY: Public Education Matters
CLIENT TYPE: Public Education
DATE: Dec 06, 2023

Existing law prohibits a retiree from working within the first 180 calendar days of retirement unless the retiree reached retirement age while earning compensation and the retiree is appointed by the governing board during a public meeting.  Existing law also restricts the amount of income a retiree may earn during any school year while receiving retirement benefits.

SB 765 amends existing law to permit a retiree to earn compensation for performing retired member activities in any school year up to the permitted limit.  However, the retiree may not contribute to the plan or accrue service credit based on the postretirement compensation.  The exemption from the first 180 calendar days only applies if the superintendent, the county superintendent of schools, or the chief executive officer of a community college submits a request for exemption and is approved by STRS with certification made under penalty of perjury of the following:

  • The nature of the employment.
  • That the appointment is necessary to fill a critically needed position before 180 calendar days have passed.
  • That the participant is not ineligible for application of this subdivision pursuant to the regulations.
  • That the termination of employment of the retired participant with the employer is not the basis for the need to acquire the services of the participant.
  • That the employer did not have a reduction-in-force layoff, pursuant to state law, within the prior 18 months.

The Legislature declares in SB 765 that the amends made by this bill are necessary to address the shortage in teachers and staff the state is experiencing.  The bill further declares that retired teachers and staff are some of the best-equipped candidates to provide instruction and services to our students.  The bill makes additional declarations related to the increase in service retirement since the onset of COVID and teacher shortage.

The bill further amends existing law to increase the limit of postretirement compensation in any school year to 70% of the median final compensation of all members who retired for service during the fiscal year ending in the previous calendar year.  The STRS is required to calculate the amount by July 1 of each year.

The amendments made by SB 765 become operative January 1, 2024, and remain in effect through June 30, 2025 unless amended by the Legislator.

(SB 765 amend, add, and repeal Sections 24214, 24214.5, and 26812 of the Education Code.)

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