Faculty Early Retirement Program - Payroll, Benefits, and Leaves

Payroll

Pay Warrants

In addition to your retirement disbursements paid by CalPERS, you will receive a salary warrant per the following schedule based on your FERP Participation. FERP participants are governed by the Unit 3, California Faculty Association Collective Bargaining Agreement. Appropriate salary increases are issued based on the salary provisions as determined by the Agreement.

FERP earnings are paid according to the same academic pay plan as for active employees. FERP participants teaching for one semester each academic year will receive six consecutive equal pay checks. FERP participants teaching for an entire academic year (no more than half time) will receive twelve consecutive equal pay checks.

Direct Deposit

FERP participants may enroll to have their FERP pay warrants deposited directly into a designated bank account. FERP participants that teach only one semester per academic year, will need to re-enroll prior to or at the start of each semester.

Withholding Deductions

FERP earnings are not subject to Social Security. FERP participants who had continuous service as CSU active employees prior to April 1, 1986 are exempt from Medicare Tax. Federal and State taxes will be deducted from your earnings paid through the State Payroll system while you participate in the Faculty Early Retirement Program. At the beginning of each semester of FERP you should confirm at the Human Resources Service Center, Kendall 220, the withholding allowances you are requesting. An Employee Action Request form will need to be completed indicating the allowance status you are requesting. All taxable gross earnings paid and withholding taxes deducted from payments will be included in the withholding tax records (W-2) for the tax year of the issue dates of the warrants. W-2s from the State Payroll system are issued approximately January 15 each year.

Benefits

You must be eligible for CalPERS health benefits in retirement to continue your health insurance coverage or to have the right to enroll in the future after retirement. Additionally, to be eligible, you must retire within 120 days of your separation from employment.

Health

FERP participants receive their health care benefits through the state as a retiree. A FERP participant who becomes eligible for Medicare after January 1, 2001, may no longer be enrolled in a CalPERS "basic" health plan. To remain eligible for a CalPERS health plan, the FERP participant must enroll both in the federal Medicare program and in his/her health plan's Medicare plan. Enrollment in Part A of Medicare is automatic, but the FERP participant must personally apply for Medicare Part B. If the FERP participant does not apply for Medicare Part B when initially eligible, a penalty will be assessed for late enrollment.

Dental

FERP participants are eligible for enhanced dental benefit coverage during the full five-year work period. Eligibility for Enhanced dental benefit coverage is based on the standard CSU benefits eligibility criteria of a timebase of at least half-time. After participating in FERP, dental coverage reverts to Basic level coverage as provided by CalPERS.

Vision

FERP participants are eligible for vision coverage during the full five-year period. Eligibility for vision coverage is based on the standard CSU benefits eligibility criteria of a timebase of at least half-time. After participating in FERP, you will have the option to continue vision benefits through the CSU Retiree Voluntary Vision Plan or COBRA.

Fee Waiver Program

Faculty participating in Faculty Early Retirement Program (FERP) are considered tenured faculty and are eligible for fee waiver during only the semester(s) in which they are in active pay status.

Health Care Reimbursement Accounts (HCRA/DCRA)

Rehired annuitants and employees under the Faculty Early Retirement Program (FERP) are not eligible to participate in either the HCRA or DCRA.

Tax Sheltered Annuity Contributions from FERP Pay

As a FERP employee you are eligible to have Tax Sheltered Annuity contributions taken from your FERP paychecks. Deductions for TSAs from settlement pay must have a pre-authorization on file with the Payroll Office. You may access the Chancellor’s Office third party administrator. You will need to log-in with your CSU, Chico Portal user name and password.

457 Deferred Compensation Plan

FERP participants are eligible to participate in a 457 Deferred Compensation Plan or 401(k) thrift plan. For information please visit the Savings Plus website.

Leaves from FERP

If medically necessary, a participant shall be granted one leave of absence without pay for personal illness for all or part of the period of employment. However, the CSU is required to comply with both the federal Family and Medical Leave Act (FMLA) and the California Family Rights Act (CFRA). Thus, FERP participants, like everyone who has been employed by the State for 12 months or more, are eligible for Family Medical Leave (FML) and CFRA leave for any of the following three reasons:

• To care for a child following birth or placement with the employee for adoption or foster care;
• To care for the employee’s spouse, child, or parent (not a parent-in-law) who has a serious health condition; and
• If the employee is unable to perform the essential functions of his/her job due to a serious health condition.

The maximum entitlement under FMLA is 12 weeks in a rolling 12-month period that begins with the date the employee’s FML begins.

Note: This leave will not extend your participation in FERP by another semester or year. 

Sick Leave

While in the program, participants earn sick leave credits on a pro rata basis for up to six days (or forty-eight hours) a year and may accumulate a maximum of twenty (20) days of sick leave credits, or one hundred sixty (160) hours. This sick leave may not be added to retirement service credit at the end of FERP participation.