In This Edition
Retirees to Get Online Access
In a recent survey, retirees told us they want secure online access to their retiree information. Soon, they’ll have it. Through myVRS for Retirees, retirees will be able to:
- View their benefit payment information.
- Check tax withholdings.
- Find out about cost-of-living adjustments.
- Check on their life insurance, health insurance coverage and health insurance credit.
Let your employees know about myVRS for Retirees as part of your retirement counseling. Look for more information in the next issue of Employer Update.
Life Insurance Now Subject to Child Support
The General Assembly passed legislation during the 2008 session that allows the Department of Social Services to file child support liens against proceeds payable under the Group Life Insurance Program administered by VRS. Upon the death of a member or retiree with such a lien, VRS will be required to pay life insurance proceeds to the Department of Social Services to satisfy outstanding child support obligations.
Compliance Review: Protect Your Access to VRS Information
Beginning in May and continuing through October, VRS will conduct an employer contact compliance review. The review is conducted every 18 months to safeguard the privacy of your employees and protect the security of VRS information.
| Type of Employer | Mail Date |
|---|---|
| School Divisions | May 2008 |
| State Agencies | July 2008 |
| Political Subdivisions | October 2008 |
As part of the review, VRS will mail a packet of information to the administrative authority (state agency head, school superintendent or other administrative head) for each employer. The packet will contain a report listing all currently authorized contacts who can access VRS information. Authorized contacts are those individuals who have the authority to contact VRS for confidential information on an employee, access myVRS for Employers and receive payroll reports and other mailings from VRS.
What To Do
VRS asks the employer to check all information contained in the report to verify that:
- There is a primary contact for Human Resources, Payroll, Publications and Accounting.
- All primary and secondary contact information is complete and up to date.
If adding a new contact, the employer must submit an Authorization of Employer Contacts (VRS-67) 
45kb. If designating a secondary administrative authority, employers must submit the Employer Certification of Authority (VRS-67-A) 35kb. These forms and instructions for completing them are enclosed in the packet.
The administrative authority must sign the completed report to verify the contacts for that employer code. The employer should return the report to VRS within 30 days.
Important: Not returning the report by the deadline will result in a suspension of access to VRS information, including myVRS for Employers.
If you have questions about completing the report, please contact an employer advisor in the VRS Customer Contact Center toll free at 1-888-VARETIR (827-3847).
Major Benefit Changes Could Require Extra Steps
Thinking about adding new benefits or changing benefits? Certain types of benefit changes require a resolution by your board or council. VRS can provide sample resolutions for:
- Health insurance credit
- Enhanced Benefits for political subdivision employees in hazardous duty positions, such as law officers, firefighters, emergency medical technicians and regional jail employees (also requires an actuarial study)
- The 1.85 percent retirement multiplier for hazardous duty positions
- Group life insurance coverage
- Commonwealth of Virginia Deferred Compensation Plan and Virginia Cash Match Plans
- Optional retirement plans (for certain eligible employers)
- Picking up and/or paying the 5 percent employee contribution (414h required)
- Picking up employee contributions for purchase of prior service (414h required).
Requests for forms and questions about adding or enhancing VRS benefits can be directed to Employer Coverage Coordinator Ben Howard, at 1-888-827-3847, ext. 6686. If your locality has passed any resolutions for benefits which have not been forwarded to VRS, please contact Ben.
May 1 Marks First Automatic Deferral to 457 Plan
May 1 marked the date of the first automatic deferral to the Commonwealth of Virginia 457 Deferred Compensation Plan. All salaried state employees hired or rehired since January 1, 2008 are enrolled automatically in the 457 Plan, unless they self enroll, enroll in a 403(b) plan or opt out of the 457 Plan.
How Auto-Enrollment Works (State Employees Only)
- In the first month after hire: Your newly hired or re-hired employee receives an automatic enrollment notice from Great West Retirement Services, the record keeper for the 457 Plan. The notice describes the benefits of the plan and provides a Personal Identification Number (PIN) for the employee to use to manage his or her account.
- First pay date 90 days after notice: A $20 deferral is automatically deposited to the employee’s 457 Plan account; a $10 employer match goes into the employee’s Cash Match account.
If An Employee Wants To Opt Out
- Before the first automatic deferral or within 90 days of the pay date of the first automatic deferral: Employees who do not want to participate in the 457 Plan may opt out online at www.vadcp.com or by calling toll free 1-866-226-6682. To opt out, employees must enter their PIN and follow the instructions given in the automatic enrollment notice.
How Employees File For A Refund
- No later than 90 days after the pay date of the first automatic deferral: The employee must submit a 457 Plan Automatic Enrollment 90-Day Permissible Withdrawal Form to request a refund after automatic deferrals begin. The form must be received no later than 90 days after the pay date of the first deferral. Refunds are taxable, so employees will receive a 1099-R for tax filing. An employee who takes a refund forfeits the employer cash match.
Why Wait?
Many new state employees are enrolling in the 457 Plan on their hire date, rather than waiting for the automatic enrollment to begin. Doing so allows them to build their savings and receive the employer match sooner. To enroll, your employee needs to fill out the paper enrollment and beneficiary forms. These forms and other resources are contained in the New Employee Kit, which VRS mailed to employers in December 2007. Forms and other resources also can be found on the Defined Contribution Plans Web site at www.vadcp.com. Once the employee receives the PIN, he or she can go online at www.vadcp.com or call KeyTalk toll free at 1-866-226-6682 to enroll. Beneficiary designations also can be made online.
Your Turn to Ask
Q: If an employee contracts to purchase prior service on a pre-tax basis and then transfers to another VRS employer, is the contract terminated? What happens if the employee terminates employment?
A: The original contract terminates when an employee transfers to another VRS employer. However, the employee retains eligibility as long as the new employer offers purchase of prior service credit on a tax-deferred basis. To offer the tax-deferred purchase option, the employer must have adopted the required resolution to provide for purchase of prior service credit on a tax-deferred basis.
To begin the purchase, the employee completes and submits a new Agreement for Salary Reduction to Purchase Service Credit (VRS-26E) 25kb to the new employer within 30 days of leaving his or her prior employer.
If the new employer does not offer purchase of service on a tax-deferred basis, the employee can always purchase the service on an after-tax basis.
Contracts end upon termination of employment. However, if the individual returns to a VRS-covered position after at least a 30-day break in service, he or she may purchase any remaining service on an after-tax basis. The employee cannot complete the purchase on a tax-deferred basis.
Ask your question
To submit a question, send an e-mail to the editor. Only questions of a general nature are published. If your question is an individual case or involves sharing any personal information, such as Social Security number, do not use e-mail. Instead, call the VRS Customer Contact Center at 1-888-VARETIR (827-3847) or contact your Employer Representative.
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