Visit the Virginia Retirement Sytem website Employer Update: A publication for VRS Employers
December 2009 A Publication for VRS Employers

VRS Board Approves Local Contribution Rates

Political Subdivision Member Profile

  • Active membership increased from 105,065 in 2008 to 105,952 in 2009.
  • Average age at retirement in 2009 was 61.1.
  • Average service at retirement in 2009 was 19.5 years.
  • Average age of active members in 2009 was 45.5 years.

At its November 19 meeting, the VRS Board of Trustees approved the employer contribution rates recommended by the VRS actuary for the 570 participating political subdivisions.

On average, employer contribution rates increased about 1.0 percent between June 30, 2007 and June 30, 2009. The increase can be attributed primarily to the market decline and plan design changes, such as localities providing hazardous duty coverage for employees not previously covered or increasing the multiplier for this group to 1.85 percent.

This December, VRS is mailing each political subdivision their actuarial valuation report providing their employer contribution rate for the coming biennium. The valuation assumptions include a 20-year amortization, a 2.5 percent inflation rate and a 7.5 percent investment rate of return.

Protect Your Employee Data

Identity Thief

Follow These Simple Security Tips

The Federal Trade Commission estimates that as many as 9 million Americans have their identities stolen each year. Using unsecure media, such as e-mail, flash or “thumb” drives, diskettes and compact disks (CDs) to send or store sensitive information puts your employees at risk of identity theft.

To reduce the risk of losing valuable member records, VRS will no longer accept unencrypted disks that contain sensitive information. Employers must use the VRS WebER application. WebER allows for a secure electronic transfer of payroll files. If you are using disk submissions, VRS will contact you shortly to provide you with more information on WebER. Coming in 2011, VRS’ Modernization Program will provide even more ways to communicate sensitive information securely.

Here are additional tips for keeping VRS customer data secure:

  • Never use e-mail to send sensitive information regarding individual employees to VRS. For assistance, call VRS toll free at 1-888-VARETIR (1-888-827-3847) to speak with an Employer Advisor (select menu option 3) or contact your Employer Representative. VRS will send only non-confidential replies.
  • Encrypt files containing sensitive employee information before e-mailing them to VRS.
  • Never copy sensitive information to storage media or devices such as flash or “thumb” drives, diskettes or CDs.
  • Use an industry-accepted standard for the encryption algorithm such as AES. Many encryption packages will support this algorithm, such as WinZip, MS Office 2007 or PGP software. Earlier versions of MS Office have a weak encryption algorithm that is easy to break. Your local IT support representative should be able to assist you with your encryption options.

What is Sensitive Information?

Sensitive information is any data, such as a Social Security number, driver’s license number, medical information, financial information or retirement account information, where the release or loss of such information could adversely affect an agency, its programs or individuals.

Counseling Long-Time Employees Contemplating a Refund

After 15, 20 or more years of service, employees have accumulated significant member contribution account balances. In tough economic times, cashing out is tempting to employees who are laid off or leaving employment. Showing these employees the numbers can help them think carefully about their options. Consider the following scenario:

After 20 years of state service, Colleen is being laid off. She has a member account balance of $55,218 and is age 52 and seven months. She could take a refund. Or she could apply for a reduced retirement. Based on her average final compensation, the Basic Benefit would be $750.71 a month. Over the next 40 years, her VRS retirement would total about $360,000. If she waited until age 62 and three months, she could retire with an unreduced Basic Benefit of $2,864.75 per month. Over the next 30 years, that would total about $1,031,040.

You can show long-time employees the numbers through myVRS for Employers or encourage them to look up the same information in their myVRS member online accounts - before they send a refund request to VRS.

FAQ of the Month

Q: What happens to group life insurance coverage for members who have been on military leave without pay for 24 months and will continue to be on military leave?


A: Basic group life insurance coverage continues for members on active duty military leave for as long as they are on leave and the premiums are paid. The employer’s personnel policy determines whether the employer or member pays the premiums. Optional group life insurance coverage also continues for members who have elected this coverage and continue to pay the premiums. For information on reporting members on leave without pay, see Employer Manual Ch. 5 - Group Life Insurance pdf icon.

Have a question?

E-mail the editor. If your question has broad appeal, it could be featured in a future edition of Employer Update.

Important note: Do not send a question regarding an individual employee or the employee’s confidential or personal information, such as a Social Security number, to the editor. For assistance with a specific case, call VRS toll free at 1-888-VARETIR (1-888-827-3847) to speak with an Employer Advisor (select menu option 3) or contact your Employer Representative.

up arrow Back to top