Frequently Asked Questions
For municipal retirees, what are the rules on working part-time?
with Hartwell Wright, the League's human resources and employee relations consulting manager
Q.
I will be retiring soon, and am interested in working part time, perhaps with a local government. Are there restrictions on what kinds of work I can and cannot do that will affect my retirement?
A.
Reemployment is both a simple and complex issue. We increasingly get questions about reemployment once someone has retired from the Local Governmental Employees Retirement System (LGERS). These questions become more and more common as the Baby Boomers begin to retire.
The rules are very specific. The easy thing to remember is that if you retire from a LGERS-participating employer and then go to work for the private sector or state government, there are no restrictions on your earnings from the retirement system. In fact, you could retire from local government service on a Friday and go to work for state government on Monday. (Note that there may be some restrictions from Social Security in this instance, but not from LGERS.)
However, if you are considering reemployment with an organization that participates in the LGERS, you can't have any earnings in the month that you retire. In short, there is a one-month waiting period. According to the State Treasurer's office website, your retirement would become void if you rendered any service to an LGERS employer “at any time during the month you retire.” Also, it “does not matter, under North Carolina law, whether you work for your prior LGERS employer or a different LGERS employer. The result will be the same.”
If you go back to work with an LGERS employee, then you have an earnings restriction. Currently, that formula says you can earn 50 percent of your final earnings as a full-time employee, or $26,960 – whichever is greater.
In addition, you are prohibited from taking a position with a local government employer that would otherwise be contributing to the local government retirement system. You also cannot work in excess of 1,000 hours in that position.
There have been some questions about if you work for a private sector organization or form an LLC and then work for or provide service to your previous local government employer or another organization participating in LGERS. Can that arrangement affect your retirement? Yes. If you provide a service to any LGERS employer, then those hours or earnings are counted toward your earnings cap.
Please understand that if you are in violation of your earnings capacity, your retirement could cease at the time you exceed your earnings cap and will not be reinstated until January 1 of the next year.
For more information on reemployment rules, please feel free to contact the LGERS call 1-877-733-4191.
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