98TH GENERAL ASSEMBLY
State of Illinois
2013 and 2014
HB3667

 

Introduced , by Rep. Dwight Kay

 

SYNOPSIS AS INTRODUCED:
 
40 ILCS 5/7-109  from Ch. 108 1/2, par. 7-109
40 ILCS 5/15-106  from Ch. 108 1/2, par. 15-106
40 ILCS 5/15-107  from Ch. 108 1/2, par. 15-107
40 ILCS 5/16-106  from Ch. 108 1/2, par. 16-106

    Amends the Illinois Pension Code. Limits the ability of certain classes of persons to participate in the retirement systems established under the Illinois Municipal Retirement Fund (IMRF), State Universities, and Downstate Teachers Articles of the Code. In the State Universities Article, specifies that, in the case of doubt as to whether a person is an employee, the decision of the Board of Trustees of the State Universities Retirement System shall be final. Effective immediately.


LRB098 13554 JDS 48079 b

FISCAL NOTE ACT MAY APPLY
PENSION IMPACT NOTE ACT MAY APPLY

 

 

A BILL FOR

 

HB3667LRB098 13554 JDS 48079 b

1    AN ACT concerning public employee benefits.
 
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
 
4    Section 5. The Illinois Pension Code is amended by changing
5Sections 7-109, 15-106, 15-107, and 16-106 as follows:
 
6    (40 ILCS 5/7-109)  (from Ch. 108 1/2, par. 7-109)
7    Sec. 7-109. Employee.
8    (1) "Employee" means any person who:
9        (a) 1. Receives earnings as payment for the performance
10        of personal services or official duties out of the
11        general fund of a municipality, or out of any special
12        fund or funds controlled by a municipality, or by an
13        instrumentality thereof, or a participating
14        instrumentality, including, in counties, the fees or
15        earnings of any county fee office; and
16            2. Under the usual common law rules applicable in
17        determining the employer-employee relationship, has
18        the status of an employee with a municipality, or any
19        instrumentality thereof, or a participating
20        instrumentality, including aldermen, county
21        supervisors and other persons (excepting those
22        employed as independent contractors) who are paid
23        compensation, fees, allowances or other emolument for

 

 

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1        official duties, and, in counties, the several county
2        fee offices.
3        (b) Serves as a township treasurer appointed under the
4    School Code, as heretofore or hereafter amended, and who
5    receives for such services regular compensation as
6    distinguished from per diem compensation, and any regular
7    employee in the office of any township treasurer whether or
8    not his earnings are paid from the income of the permanent
9    township fund or from funds subject to distribution to the
10    several school districts and parts of school districts as
11    provided in the School Code, or from both such sources; or
12    is the chief executive officer, chief educational officer,
13    chief fiscal officer, or other employee of a Financial
14    Oversight Panel established pursuant to Article 1H of the
15    School Code, other than a superintendent or certified
16    school business official, except that such person shall not
17    be treated as an employee under this Section if that person
18    has negotiated with the Financial Oversight Panel, in
19    conjunction with the school district, a contractual
20    agreement for exclusion from this Section.
21        (c) Holds an elective office in a municipality,
22    instrumentality thereof or participating instrumentality.
23    (2) "Employee" does not include persons who:
24        (a) Are eligible for inclusion under any of the
25    following laws:
26            1. "An Act in relation to an Illinois State

 

 

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1        Teachers' Pension and Retirement Fund", approved May
2        27, 1915, as amended;
3            2. Articles 15 and 16 of this Code.
4        However, such persons shall be included as employees to
5    the extent of earnings that are not eligible for inclusion
6    under the foregoing laws for services not of an
7    instructional nature of any kind.
8        However, any member of the armed forces who is employed
9    as a teacher of subjects in the Reserve Officers Training
10    Corps of any school and who is not certified under the law
11    governing the certification of teachers shall be included
12    as an employee.
13        (b) Are designated by the governing body of a
14    municipality in which a pension fund is required by law to
15    be established for policemen or firemen, respectively, as
16    performing police or fire protection duties, except that
17    when such persons are the heads of the police or fire
18    department and are not eligible to be included within any
19    such pension fund, they shall be included within this
20    Article; provided, that such persons shall not be excluded
21    to the extent of concurrent service and earnings not
22    designated as being for police or fire protection duties.
23    However, (i) any head of a police department who was a
24    participant under this Article immediately before October
25    1, 1977 and did not elect, under Section 3-109 of this Act,
26    to participate in a police pension fund shall be an

 

 

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1    "employee", and (ii) any chief of police who elects to
2    participate in this Fund under Section 3-109.1 of this
3    Code, regardless of whether such person continues to be
4    employed as chief of police or is employed in some other
5    rank or capacity within the police department, shall be an
6    employee under this Article for so long as such person is
7    employed to perform police duties by a participating
8    municipality and has not lawfully rescinded that election.
9        (c) After August 26, 2011 (the effective date of Public
10    Act 97-609), are contributors to or eligible to contribute
11    to a Taft-Hartley pension plan established on or before
12    June 1, 2011 and are employees of a theatre, arena, or
13    convention center that is located in a municipality located
14    in a county with a population greater than 5,000,000, and
15    to which the participating municipality is required to
16    contribute as the person's employer based on earnings from
17    the municipality. Nothing in this paragraph shall affect
18    service credit or creditable service for any period of
19    service prior to August 26, 2011, and this paragraph shall
20    not apply to individuals who are participating in the Fund
21    prior to August 26, 2011.
22        (d) Become an employee of any of the following
23    participating instrumentalities on or after the effective
24    date of this amendatory Act of the 98th General Assembly:
25    the Illinois Municipal League; the Illinois Association of
26    Park Districts; the Illinois Supervisors, County

 

 

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1    Commissioners and Superintendents of Highways Association;
2    an association, or not-for-profit corporation, membership
3    in which is authorized under Section 85-15 of the Township
4    Code; the United Counties Council; or the Will County
5    Governmental League.
6    (3) All persons, including, without limitation, public
7defenders and probation officers, who receive earnings from
8general or special funds of a county for performance of
9personal services or official duties within the territorial
10limits of the county, are employees of the county (unless
11excluded by subsection (2) of this Section) notwithstanding
12that they may be appointed by and are subject to the direction
13of a person or persons other than a county board or a county
14officer. It is hereby established that an employer-employee
15relationship under the usual common law rules exists between
16such employees and the county paying their salaries by reason
17of the fact that the county boards fix their rates of
18compensation, appropriate funds for payment of their earnings
19and otherwise exercise control over them. This finding and this
20amendatory Act shall apply to all such employees from the date
21of appointment whether such date is prior to or after the
22effective date of this amendatory Act and is intended to
23clarify existing law pertaining to their status as
24participating employees in the Fund.
25(Source: P.A. 97-429, eff. 8-16-11; 97-609, eff. 8-26-11;
2697-813, eff. 7-13-12.)
 

 

 

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1    (40 ILCS 5/15-106)  (from Ch. 108 1/2, par. 15-106)
2    Sec. 15-106. Employer. "Employer": The University of
3Illinois, Southern Illinois University, Chicago State
4University, Eastern Illinois University, Governors State
5University, Illinois State University, Northeastern Illinois
6University, Northern Illinois University, Western Illinois
7University, the State Board of Higher Education, the Illinois
8Mathematics and Science Academy, the University Civil Service
9Merit Board, the Board of Trustees of the State Universities
10Retirement System, the Illinois Community College Board,
11community college boards, any association of community college
12boards organized under Section 3-55 of the Public Community
13College Act, the Board of Examiners established under the
14Illinois Public Accounting Act, and, only during the period for
15which employer contributions required under Section 15-155 are
16paid, the following organizations: the alumni associations,
17the foundations and the athletic associations which are
18affiliated with the universities and colleges included in this
19Section as employers. An individual that begins employment
20after the effective date of this amendatory Act of the 98th
21General Assembly with an entity not defined as an employer in
22this Section shall not be deemed an employee for the purposes
23of this Article with respect to that employment and shall not
24be eligible to participate in the System with respect to that
25employment; provided, however, that those individuals who are

 

 

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1both employed and already participants in the System on the
2effective date of this amendatory Act of the 98th General
3Assembly shall be allowed to continue as participants in the
4System for the duration of that employment.
5    Notwithstanding any provision of law to the contrary, an
6individual who begins employment with any of the following
7employers on or after the effective date of this amendatory Act
8of the 98th General Assembly shall not be deemed an employee
9and shall not be eligible to participate in the System with
10respect to that employment: any association of community
11college boards organized under Section 3-55 of the Public
12Community College Act, the Association of Illinois
13Middle-Grade Schools, the Illinois Association of School
14Administrators, the Illinois Association for Supervision and
15Curriculum Development, the Illinois Principals Association,
16the Illinois Association of School Business Officials, or the
17Illinois Special Olympics; provided, however, that those
18individuals who are both employed and already participants in
19the System on the effective date of this amendatory Act of the
2098th General Assembly shall be allowed to continue as
21participants in the System for the duration of that employment.
22    A department as defined in Section 14-103.04 is an employer
23for any person appointed by the Governor under the Civil
24Administrative Code of Illinois who is a participating employee
25as defined in Section 15-109. The Department of Central
26Management Services is an employer with respect to persons

 

 

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1employed by the State Board of Higher Education in positions
2with the Illinois Century Network as of June 30, 2004 who
3remain continuously employed after that date by the Department
4of Central Management Services in positions with the Illinois
5Century Network, the Bureau of Communication and Computer
6Services, or, if applicable, any successor bureau.
7    The cities of Champaign and Urbana shall be considered
8employers, but only during the period for which contributions
9are required to be made under subsection (b-1) of Section
1015-155 and only with respect to individuals described in
11subsection (h) of Section 15-107.
12(Source: P.A. 95-369, eff. 8-23-07; 95-728, eff. 7-1-08 - See
13Sec. 999.)
 
14    (40 ILCS 5/15-107)  (from Ch. 108 1/2, par. 15-107)
15    Sec. 15-107. Employee.
16    (a) "Employee" means any member of the educational,
17administrative, secretarial, clerical, mechanical, labor or
18other staff of an employer whose employment is permanent and
19continuous or who is employed in a position in which services
20are expected to be rendered on a continuous basis for at least
214 months or one academic term, whichever is less, who (A)
22receives payment for personal services on a warrant issued
23pursuant to a payroll voucher certified by an employer and
24drawn by the State Comptroller upon the State Treasurer or by
25an employer upon trust, federal or other funds, or (B) is on a

 

 

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1leave of absence without pay. Employment which is irregular,
2intermittent or temporary shall not be considered continuous
3for purposes of this paragraph.
4    However, a person is not an "employee" if he or she:
5        (1) is a student enrolled in and regularly attending
6    classes in a college or university which is an employer,
7    and is employed on a temporary basis at less than full
8    time;
9        (2) is currently receiving a retirement annuity or a
10    disability retirement annuity under Section 15-153.2 from
11    this System;
12        (3) is on a military leave of absence;
13        (4) is eligible to participate in the Federal Civil
14    Service Retirement System and is currently making
15    contributions to that system based upon earnings paid by an
16    employer;
17        (5) is on leave of absence without pay for more than 60
18    days immediately following termination of disability
19    benefits under this Article;
20        (6) is hired after June 30, 1979 as a public service
21    employment program participant under the Federal
22    Comprehensive Employment and Training Act and receives
23    earnings in whole or in part from funds provided under that
24    Act; or
25        (7) is employed on or after July 1, 1991 to perform
26    services that are excluded by subdivision (a)(7)(f) or

 

 

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1    (a)(19) of Section 210 of the federal Social Security Act
2    from the definition of employment given in that Section (42
3    U.S.C. 410).
4    (b) Any employer may, by filing a written notice with the
5board, exclude from the definition of "employee" all persons
6employed pursuant to a federally funded contract entered into
7after July 1, 1982 with a federal military department in a
8program providing training in military courses to federal
9military personnel on a military site owned by the United
10States Government, if this exclusion is not prohibited by the
11federally funded contract or federal laws or rules governing
12the administration of the contract.
13    (c) Any person appointed by the Governor under the Civil
14Administrative Code of the State is an employee, if he or she
15is a participant in this system on the effective date of the
16appointment.
17    (d) A participant on lay-off status under civil service
18rules is considered an employee for not more than 120 days from
19the date of the lay-off.
20    (e) A participant is considered an employee during (1) the
21first 60 days of disability leave, (2) the period, not to
22exceed one year, in which his or her eligibility for disability
23benefits is being considered by the board or reviewed by the
24courts, and (3) the period he or she receives disability
25benefits under the provisions of Section 15-152, workers'
26compensation or occupational disease benefits, or disability

 

 

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1income under an insurance contract financed wholly or partially
2by the employer.
3    (f) Absences without pay, other than formal leaves of
4absence, of less than 30 calendar days, are not considered as
5an interruption of a person's status as an employee. If such
6absences during any period of 12 months exceed 30 work days,
7the employee status of the person is considered as interrupted
8as of the 31st work day.
9    (g) A staff member whose employment contract requires
10services during an academic term is to be considered an
11employee during the summer and other vacation periods, unless
12he or she declines an employment contract for the succeeding
13academic term or his or her employment status is otherwise
14terminated, and he or she receives no earnings during these
15periods.
16    (h) An individual who was a participating employee employed
17in the fire department of the University of Illinois's
18Champaign-Urbana campus immediately prior to the elimination
19of that fire department and who immediately after the
20elimination of that fire department became employed by the fire
21department of the City of Urbana or the City of Champaign shall
22continue to be considered as an employee for purposes of this
23Article for so long as the individual remains employed as a
24firefighter by the City of Urbana or the City of Champaign. The
25individual shall cease to be considered an employee under this
26subsection (h) upon the first termination of the individual's

 

 

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1employment as a firefighter by the City of Urbana or the City
2of Champaign.
3    (i) An individual who is employed on a full-time basis as
4an officer or employee of a statewide teacher organization that
5serves System participants or an officer of a national teacher
6organization that serves System participants may participate
7in the System and shall be deemed an employee, provided that
8(1) the individual has previously earned creditable service
9under this Article, (2) the individual files with the System an
10irrevocable election to become a participant before the
11effective date of this amendatory Act of the 97th General
12Assembly, (3) the individual does not receive credit for that
13employment under any other Article of this Code, and (4) the
14individual first became a full-time employee of the teacher
15organization and becomes a participant before the effective
16date of this amendatory Act of the 97th General Assembly. An
17employee under this subsection (i) is responsible for paying to
18the System both (A) employee contributions based on the actual
19compensation received for service with the teacher
20organization and (B) employer contributions equal to the normal
21costs (as defined in Section 15-155) resulting from that
22service; all or any part of these contributions may be paid on
23the employee's behalf or picked up for tax purposes (if
24authorized under federal law) by the teacher organization.
25    A person who is an employee as defined in this subsection
26(i) may establish service credit for similar employment prior

 

 

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1to becoming an employee under this subsection by paying to the
2System for that employment the contributions specified in this
3subsection, plus interest at the effective rate from the date
4of service to the date of payment. However, credit shall not be
5granted under this subsection for any such prior employment for
6which the applicant received credit under any other provision
7of this Code, or during which the applicant was on a leave of
8absence under Section 15-113.2.
9    (j) A person employed by the State Board of Higher
10Education in a position with the Illinois Century Network as of
11June 30, 2004 shall be considered to be an employee for so long
12as he or she remains continuously employed after that date by
13the Department of Central Management Services in a position
14with the Illinois Century Network, the Bureau of Communication
15and Computer Services, or, if applicable, any successor bureau
16and meets the requirements of subsection (a).
17    (k) In the case of doubt as to whether any person is an
18employee within the meaning of this Section, the decision of
19the Board shall be final.
20(Source: P.A. 97-651, eff. 1-5-12.)
 
21    (40 ILCS 5/16-106)  (from Ch. 108 1/2, par. 16-106)
22    Sec. 16-106. Teacher. "Teacher": The following
23individuals, provided that, for employment prior to July 1,
241990, they are employed on a full-time basis, or if not
25full-time, on a permanent and continuous basis in a position in

 

 

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1which services are expected to be rendered for at least one
2school term:
3        (1) Any educational, administrative, professional or
4    other staff employed in the public common schools included
5    within this system in a position requiring certification
6    under the law governing the certification of teachers;
7        (2) Any educational, administrative, professional or
8    other staff employed in any facility of the Department of
9    Children and Family Services or the Department of Human
10    Services, in a position requiring certification under the
11    law governing the certification of teachers, and any person
12    who (i) works in such a position for the Department of
13    Corrections, (ii) was a member of this System on May 31,
14    1987, and (iii) did not elect to become a member of the
15    State Employees' Retirement System pursuant to Section
16    14-108.2 of this Code; except that "teacher" does not
17    include any person who (A) becomes a security employee of
18    the Department of Human Services, as defined in Section
19    14-110, after June 28, 2001 (the effective date of Public
20    Act 92-14), or (B) becomes a member of the State Employees'
21    Retirement System pursuant to Section 14-108.2c of this
22    Code;
23        (3) Any regional superintendent of schools, assistant
24    regional superintendent of schools, State Superintendent
25    of Education; any person employed by the State Board of
26    Education as an executive; any executive of the boards

 

 

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1    engaged in the service of public common school education in
2    school districts covered under this system of which the
3    State Superintendent of Education is an ex-officio member;
4        (4) Any employee of a school board association
5    operating in compliance with Article 23 of the School Code
6    who is certificated under the law governing the
7    certification of teachers, provided that he or she becomes
8    such an employee before the effective date of this
9    amendatory Act of the 98th General Assembly;
10        (5) Any person employed by the retirement system who:
11            (i) was an employee of and a participant in the
12        system on August 17, 2001 (the effective date of Public
13        Act 92-416), or
14            (ii) becomes an employee of the system on or after
15        August 17, 2001;
16        (6) Any educational, administrative, professional or
17    other staff employed by and under the supervision and
18    control of a regional superintendent of schools, provided
19    such employment position requires the person to be
20    certificated under the law governing the certification of
21    teachers and is in an educational program serving 2 or more
22    districts in accordance with a joint agreement authorized
23    by the School Code or by federal legislation;
24        (7) Any educational, administrative, professional or
25    other staff employed in an educational program serving 2 or
26    more school districts in accordance with a joint agreement

 

 

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1    authorized by the School Code or by federal legislation and
2    in a position requiring certification under the laws
3    governing the certification of teachers;
4        (8) Any officer or employee of a statewide teacher
5    organization or officer of a national teacher organization
6    who is certified under the law governing certification of
7    teachers, provided: (i) the individual had previously
8    established creditable service under this Article, (ii)
9    the individual files with the system an irrevocable
10    election to become a member before the effective date of
11    this amendatory Act of the 97th General Assembly, (iii) the
12    individual does not receive credit for such service under
13    any other Article of this Code, and (iv) the individual
14    first became an officer or employee of the teacher
15    organization and becomes a member before the effective date
16    of this amendatory Act of the 97th General Assembly;
17        (9) Any educational, administrative, professional, or
18    other staff employed in a charter school operating in
19    compliance with the Charter Schools Law who is certificated
20    under the law governing the certification of teachers; .
21        (10) Any person employed, on the effective date of this
22    amendatory Act of the 94th General Assembly, by the
23    Macon-Piatt Regional Office of Education in a
24    birth-through-age-three pilot program receiving funds
25    under Section 2-389 of the School Code who is required by
26    the Macon-Piatt Regional Office of Education to hold a

 

 

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1    teaching certificate, provided that the Macon-Piatt
2    Regional Office of Education makes an election, within 6
3    months after the effective date of this amendatory Act of
4    the 94th General Assembly, to have the person participate
5    in the system. Any service established prior to the
6    effective date of this amendatory Act of the 94th General
7    Assembly for service as an employee of the Macon-Piatt
8    Regional Office of Education in a birth-through-age-three
9    pilot program receiving funds under Section 2-389 of the
10    School Code shall be considered service as a teacher if
11    employee and employer contributions have been received by
12    the system and the system has not refunded those
13    contributions.
14    An annuitant receiving a retirement annuity under this
15Article or under Article 17 of this Code who is employed by a
16board of education or other employer as permitted under Section
1716-118 or 16-150.1 is not a "teacher" for purposes of this
18Article. A person who has received a single-sum retirement
19benefit under Section 16-136.4 of this Article is not a
20"teacher" for purposes of this Article.
21(Source: P.A. 97-651, eff. 1-5-12; revised 8-3-12.)
 
22    Section 99. Effective date. This Act takes effect upon
23becoming law.