LRB-3465/3
RAC:jld:jf
2011 - 2012 LEGISLATURE
February 8, 2012 - Introduced by Representatives Litjens, Spanbauer, Bies,
Brooks, T. Larson, Thiesfeldt
and Endsley, cosponsored by Senator
Galloway. Referred to Committee on Veterans and Military Affairs. Referred
to Joint Survey Committee on Retirement Systems.
AB550,1,4 1An Act to amend 40.05 (1) (b) 1.; and to create 40.05 (1) (b) 3. of the statutes;
2relating to: payment of employee required contributions under the Wisconsin
3Retirement System for participating employees activated to serve on military
4duty in the U.S. armed forces.
Analysis by the Legislative Reference Bureau
Under current law, with exceptions, participating employees in the Wisconsin
Retirement System (WRS) must pay all employee required contributions that are
used to fund their retirement benefits. This bill requires employers to pay WRS
employee required contributions for participating employees who are activated to
serve on military duty in the U.S. armed forces and the commitment is for a period
of more than 30 days. Under the bill, the contributions must be based on the earnings
that the participating employee would have received from the employer had the
participating employee not been activated to serve on military duty.
The bill also provides that an employer may recover from the employee's
earnings paid after the employee is reemployed by the employer the contributions
paid for the employee. In recovering the contributions, the employer may not deduct
from the employee's earnings more than 5 percent of each payment of earnings,
unless otherwise provided in a voluntary written agreement between the employer
and employee.
Because this bill relates to public employee retirement or pensions, it may be
referred to the Joint Survey Committee on Retirement Systems for a report to be
printed as an appendix to the bill.

For further information see the state and local fiscal estimate, which will be
printed as an appendix to this bill.
The people of the state of Wisconsin, represented in senate and assembly, do
enact as follows:
AB550, s. 1 1Section 1. 40.05 (1) (b) 1. of the statutes, as affected by 2011 Wisconsin Act 32,
2is amended to read:
AB550,2,113 40.05 (1) (b) 1. Except as otherwise provided in a collective bargaining
4agreement entered into under subch. IV or V of ch. 111 and except as provided in
5subd. subds. 2. and 3., an employer may not pay, on behalf of a participating
6employee, any of the contributions required by par. (a). The contributions required
7by par. (a) shall be made by a reduction in salary and, for tax purposes, shall be
8considered employer contributions under section 414 (h) (2) of the Internal Revenue
9Code. A participating employee may not elect to have contributions required by par.
10(a) paid directly to the employee or make a cash or deferred election with respect to
11the contributions.
AB550, s. 2 12Section 2. 40.05 (1) (b) 3. of the statutes is created to read:
AB550,3,513 40.05 (1) (b) 3. If a participating employee is activated to perform services in
14the uniformed services, as defined in 38 USC 4303 (13), for a period of more than 30
15days, and the employee's service has not been terminated upon occurrence of any of
16the events described in 38 USC 4304, the employer shall pay the contributions
17required by par. (a) for that participating employee for the period in which he or she
18is on a military leave of absence, but only if the employee is reemployed by that
19employer consistent with 38 USC 4312 (e) (1) (C) or (D) or (2) (A) or (B). The
20contributions shall be based on the employee's earnings as determined under s. 40.02
21(22) (e). An employer may recover from the employee's earnings paid after the

1employee is reemployed by the employer the contributions paid for the employee
2under this subdivision. In recovering the contributions, the employer may not
3deduct from the employee's earnings more than 5 percent of each payment of
4earnings, unless otherwise provided in a voluntary written agreement between the
5employer and employee.
AB550, s. 3 6Section 3. Effective date.
AB550,3,77 (1) This act takes effect retroactively to July 1, 2011.
AB550,3,88 (End)
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