Human Resources

Current state statute (40 ILCS 5/15-112) provides:

".... In the determination of the final rate of earnings for an employee, that part of an employee's earnings for any academic year beginning after June 30, 1997, which exceeds the employee's earnings with that employer for the preceding year by more than 20 percent shall be excluded; in the event that an employee has more than one employer this limitation shall be calculated separately for the earnings with each employer. In making such calculation, only the basic compensation of employees shall be considered, without regard to vacation or overtime or to contracts for summer employment."

Subject to confirmation by SURS, the 20% statute represents a maximum liability or assessment which the University would be subject to in a given year. Any compensation increase up to 20% over the previous year is used in the retirement calculation. For example, if the University were to award a salary increase of 20% or more to an employee in the FAE years, the University would be billed for the lump sum cost of the annuity that results from the 14% above the 6% limit.