LRB-2944/2
RAC:jld:rs
2011 - 2012 LEGISLATURE
October 31, 2011 - Introduced by Representatives Ziegelbauer, Nass, Petersen,
Endsley, Litjens, Thiesfeldt
and Wynn, cosponsored by Senator Lasee.
Referred to Committee on Insurance.
AB352,1,5 1An Act to amend 40.22 (2) (a), 40.22 (2) (am), 40.22 (2m) (intro.), 40.22 (2r), 40.22
2(3) (b) 2., 40.23 (1) (a) 1., 40.26 (1) and 40.26 (2) (intro.); and to create 40.26 (1m)
3of the statutes; relating to: eligibility for participating employee status and
4the Wisconsin Retirement System and post-retirement employment of
5annuitants under the Wisconsin Retirement System.
Analysis by the Legislative Reference Bureau
Under current law, a participant in the Wisconsin Retirement System (WRS)
who has attained the age of 55, or a protective occupation participant who has
attained age 50, is entitled to receive a WRS annuity if, among other requirements,
the participant is separated from covered employment under the WRS until the
latest of the following: the annuity effective date; the date 30 days after the
application is received by the Department of Employee Trust Funds (DETF); or the
date 30 days after separation from all covered employment. The bill provides that
the participant must be separated from covered employment under the WRS for at
least 180 days.
2011 Wisconsin Act 32 increased the number of hours that an employee must
work in order to become a participating employee in the WRS, from one-third of what
is considered full-time employment to two-thirds of what is considered full-time
employment, as determined by DETF by rule. This change in law applied to those
employees who were first hired by a WRS employer on or after July 1, 2011. This bill
reduces that eligibility requirement to 660 hours for a teacher or educational support

personnel employee, and 1,000 hours for all other employees. The bill further
provides that this change in law does not affect employees who were participating
employees at any time before July 1, 2011. As a result, these individuals are subject
to the one-third employment requirement for WRS participation purposes.
In addition, under current law, when a WRS participant terminates covered
employment and becomes an annuitant he or she may return to covered employment
and either terminate the annuity and again become a participating employee or,
instead, continue to receive the annuity, as well as wages from covered employment.
If a participant continues to receive the annuity, he or she may not be a participating
employee in the WRS and, in the case of state employment, is not eligible for group
insurance benefits provided to participating employees, and may not use any of his
or her employment service as a rehired annuitant for any WRS purposes. If the
participant terminates the annuity, he or she returns to participating employee
status and is eligible for all group insurance benefits provided other participating
employees, as well as is able to accumulate additional years of creditable service
under the WRS for the additional period of covered employment.
This bill provides that, beginning on the bill's effective date, if a participant in
the WRS, who is receiving an annuity, or a disability annuitant who has attained his
or her normal retirement date, is appointed to a position in covered employment in
which he or she is expected to work at least one-half time, the participant's annuity
must be terminated and no annuity payment is payable until after the participant
terminates covered employment.
The bill also provides that, if a participant receiving a retirement annuity, or
a disability annuitant who has attained his or her normal retirement date, enters
into a contract to provide employee services with a participating employer after the
bill's effective date, and he or she is expected to work at least one-half time, the
participant's retirement annuity must be terminated and no annuity payment is
payable until after the participant no longer provides employee services under the
contract.
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:
AB352, s. 1 1Section 1. 40.22 (2) (a) of the statutes, as affected by 2011 Wisconsin Act 32,
2is amended to read:
AB352,3,23 40.22 (2) (a) Except as provided in sub. (2m), the employee was initially
4employed by a participating employer
a participating employee before July 1, 2011,

1and is not expected to work at least one-third of what is considered full-time
2employment by the department, as determined by rule.
AB352, s. 2 3Section 2. 40.22 (2) (am) of the statutes, as created by 2011 Wisconsin Act 32,
4is amended to read:
AB352,3,125 40.22 (2) (am) Except as provided in sub. (2r), the employee was initially
6employed by a participating employer on or after July 1, 2011, and is not expected
7to work at least two-thirds one-half of what is considered full-time employment by
8the department, as determined by rule
. For teachers and educational support
9personnel employees, one-half of what is considered full-time employment is 660
10hours of employment with an employer in one year. For all other employees, one-half
11of what is considered full-time employment is 1,000 hours of employment with an
12employer in one year
.
AB352, s. 3 13Section 3. 40.22 (2m) (intro.) of the statutes, as affected by 2011 Wisconsin Act
1432
, is amended to read:
AB352,3,2115 40.22 (2m) (intro.) An employee who was initially employed by a participating
16employer
a participating employee before July 1, 2011, who is not expected to work
17at least one-third of what is considered full-time employment by the department,
18as determined by rule, and who is not otherwise excluded under sub. (2) from
19becoming a participating employee shall become a participating employee if he or she
20is subsequently employed by the state agency or other participating employer for
21either of the following periods:
AB352, s. 4 22Section 4. 40.22 (2r) of the statutes, as created by 2011 Wisconsin Act 32, is
23amended to read:
AB352,4,524 40.22 (2r) An employee who was initially employed by a participating employer
25on or after July 1, 2011, who is not expected to work at least two-thirds one-half of

1what is considered full-time employment by the department, as determined by rule
2provided under sub. (2) (am), and who is not otherwise excluded under sub. (2) from
3becoming a participating employee shall become a participating employee if he or she
4is subsequently employed by the state agency or other participating employer for
5either of the following periods:
AB352,4,96 (a) At least one year for at least two-thirds one-half of what is considered
7full-time employment by the department, as determined by rule, or, for an
8educational support personnel employee, at least one year for at least two-thirds of
9what is considered full-time employment for a teacher
provided under sub. (2) (am).
AB352,4,1010 (b) At least 1,200 1,000 hours in the immediately preceding 12-month period.
AB352, s. 5 11Section 5. 40.22 (3) (b) 2. of the statutes, as created by 2011 Wisconsin Act 32,
12is amended to read:
AB352,4,1713 40.22 (3) (b) 2. The first day after completion of one year of employment for at
14least two-thirds one-half of what is considered full-time employment by the
15department
, as determined by rule provided under sub. (2) (am), if the person
16becomes a participating employee under sub. (2r) after the employer's effective date
17of participation.
AB352, s. 6 18Section 6. 40.23 (1) (a) 1. of the statutes is amended to read:
AB352,4,2319 40.23 (1) (a) 1. The participant is separated, regardless of cause, and continues
20to be separated until the annuity effective date, the date 30 days after the application
21is received by the department, or the date 30 180 days after separation, whichever
22is later latest, from all employment meeting the qualifications for inclusion specified
23in s. 40.22 for any participating employer.
AB352, s. 7 24Section 7. 40.26 (1) of the statutes is amended to read:
AB352,5,8
140.26 (1) Except as provided in sub. (1m) and ss. 40.05 (2) (g) 2. and 40.23 (1)
2(am), if a participant receiving a retirement annuity, or a disability annuitant who
3has attained his or her normal retirement date, receives earnings that are subject
4to s. 40.05 (1) or that would be subject to s. 40.05 (1) except for the exclusion specified
5in s. 40.22 (2) (L), the annuity shall be terminated and no annuity payment shall be
6payable after the month in which the participant files with the department a written
7election to be included within the provisions of the Wisconsin retirement system as
8a participating employee.
AB352, s. 8 9Section 8. 40.26 (1m) of the statutes is created to read:
AB352,5,1610 40.26 (1m) (a) If a participant receiving a retirement annuity, or a disability
11annuitant who has attained his or her normal retirement date, is appointed to a
12position in covered employment after the effective date of this paragraph .... [LRB
13inserts date], in which he or she is expected to work at least one-half of what is
14considered full-time employment, as provided under s. 40.22 (2) (am), the
15participant's retirement annuity shall be terminated and no annuity payment shall
16be payable until after the participant terminates covered employment.
AB352,5,2417 (b) If a participant receiving a retirement annuity, or a disability annuitant
18who has attained his or her normal retirement date, enters into a contract to provide
19employee services with a participating employer after the effective date of this
20paragraph .... [LRB inserts date], and he or she is expected to work at least one-half
21of what is considered full-time employment, as provided under s. 40.22 (2) (am), the
22participant's retirement annuity shall be terminated and no annuity payment shall
23be payable until after the participant no longer provides employee services under the
24contract.
AB352, s. 9 25Section 9. 40.26 (2) (intro.) of the statutes is amended to read:
AB352,6,3
140.26 (2) (intro.) Upon termination of an annuity under sub. (1) or (1m), the
2retirement account of the participant whose annuity is so terminated shall be
3reestablished on the following basis:
AB352, s. 10 4Section 10. Initial applicability.
AB352,6,85 (1) The treatment of section 40.23 (1) (a) 1. of the statutes first applies to
6participating employees under the Wisconsin Retirement System who terminate
7covered employment under the Wisconsin Retirement System on the effective date
8of this subsection.
AB352,6,99 (End)
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