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Provost and Vice President for Academic Affairs

Estimating Benefit Costs

The following generally describes how to determine benefit costs on an employee’s additional pay appointment:

  • All additional compensation will have the 1.45% Medicare benefit expense posted to 603012.      
  • Additional compensation for employees with less than a full-time appointment will generally have the 6.2% FICA/OASDI benefit expense posted to 603001.
  • Additional compensation for employees, who are already CalPERS members, with less than a full-time appointment will generally have the 31.08% Retirement benefit expense posted to 603005.
  • If the employee receiving the additional compensation fits all three scenarios the total benefit expense would be 38.73%.  However, this is likely not the norm. 

Most additional appointments are for employees that are already at 1.0 time-base and are current CalPERS members. If this is the case, the only additional benefit expense incurred would be the 1.45%. 

Below is a chart that may be useful in determining the retirement component of the benefit costs and budgeting benefit expenses.  If a department is unsure if their employee is a current CalPERS member, they can review past LCD to see if expenses are posting to 603005 for that particular employee.  There is a chance that a particular payment could affect an employee’s membership status and trigger the retirement costs.

Please see additional benefit contribution information (PDF).

Estimated benefit expense from coverage programs offered

 

 

Est. Benefit Expense

CalPERS member

AND
Full-time Employment

NO Retirement

Verify in LCD that 603005 expenses are posting for individual and

FTE = 1.0

1.45%

CalPERS member

AND
Less than full-time employment

YES Retirement

Verify in LCD that 603005 expenses are posting for individual and

FTE less than 1.0

38.73%

Not CalPERS member

Depends, Payroll will evaluate and make a determination, as over time an employee may become eligible

Verify in LCD that no 603005 expenses are posting for individual

7.65%

Not CalPERS member

BUT

3rd consecutive semester of half time or more

YES Retirement

According to CalPERS rules, a temporary faculty member becomes eligible for retirement benefits:

“If appointed for an academic year at half-time or more, the employee qualifies for membership at the beginning of the third consecutive semester or at the beginning of the fourth quarter (GC 20305 [a][4]).”

38.73%