Working in the Public Sector
The retirement laws limit the earnings of all retired public employees who work in the public sector after retirement The “public sector” is broadly defined as the Commonwealth and all political subdivisions, including cities, towns, authorities, and districts. This law is contained in General Laws Chapter 32, section 91
The law limits a retiree who is receiving a retirement allowance to 960 hours of employment within the public sector in any calendar year. A second limitation is the salary which can be paid for such public sector employment. When added to the retiree’s retirement allowance, the salary cannot exceed the salary that is currently being paid for the position from which the member was retired, plus $15,000, after 12 months of retirement. The law places the obligation of enforcing these restrictions upon the Treasurers of the governmental units hiring public sector retirees.
|• Section 91 applies to both superannuation and disability retirees|
• Section 91 applies to any public employment, regardless of whether or not it occurs with the same governmental unit from which the employee retired.
• It is irrelevant whether an employee-retiree chooses to classify him or herself as a “consultant” or “independent contractor.” The Section 91 earnings limitations will apply.
• A retiree may not avoid the limitations in Section 91 by forming a company if the primary reason for the formation is to avoid the limitations.
• Earnings for “details” which are paid by city or town payroll are included in the Section 91 limitations, regardless of whether the city or town ultimately bills a private entity for the work.
• The Section 91 limitations apply solely to retirees, not to survivors or beneficiaries.
• Earnings from elective office, jury service and emergency employment with a public entity are unrestricted.
Working in the Private Sector
A non-disability retiree can earn unlimited salary in the private sector with no impact upon the retiree’s public employee retirement allowance. A disability retiree, however, is limited to earning the difference between the current salary for the retiree’s former position, minus the current retirement allowance, plus $5,000. General Laws Chapter 32, section 91A
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