RCW ch. 41.40 — Revised Code of Washington Chapter 41.40 RCW — Washington Public Employees' Retirement System

RCW 41.40.005 Provisions applicable to "plan 1," "plan 2," and "plan 3." RCW 41.40.010 through * 41.40.112 shall apply to members of plan 1, plan 2, and plan 3. [ 2000 c 247 s 101; 1992 c 72 s 8; 1991 c 35 s 69; 1989 c 273 s 20; 1989 c 272 s 7; 1979 ex.s. c 249 s 6; 1977 ex.s. c 295 s 21.] NOTES: *Reviser's note: RCW 41.40.010 Definitions. (Effective until June 30, 2029.) As used in this chapter, unless a different meaning is plainly required by the context: (1) "Accumulated contributions" means the sum of all contributions standing to the credit of a member in the member's individual account, including any amount paid under RCW 41.50.165(2), together with the regular interest thereon. (2) "Actuarial equivalent" means a benefit of equal value when computed upon the basis of such mortality and other tables as may be adopted by the director. (3) "Adjustment ratio" means the value of index A divided by index B. (4) "Annual increase" means, initially, 59 cents per month per year of service which amount shall be increased each July 1st by three percent, rounded to the nearest cent. (5) "Annuity" means payments for life derived from accumulated contributions of a member. All annuities shall be paid in monthly installments. (6)(a) "Average final compensation" for plan 1 members, means the annual average of the greatest compensation earnable by a member during any consecutive two year period of service credit months for which service credit is allowed; or if the member has less than two years of service credit months then the annual average compensation earnable during the total years of service for which service credit is allowed. (b) "Average final compensation" for plan 2 and plan 3 members, means the member's average compensation earnable of the highest consecutive sixty months of service credit months prior to such member's retirement, termination, or death. Periods constituting authorized leaves of absence may not be used in the calculation of average final compensation except under RCW 41.40.710(2) or (c) of this subsection. (c) In calculating average final compensation under this subsection for a member of plan 1, 2, or 3, the department of retirement systems shall include: (i) Any compensation forgone by the member during the 2009-2011 fiscal biennium as a result of reduced work hours, voluntary leave without pay, temporary reduction in pay implemented prior to December 11, 2010, or temporary furloughs if the reduced compensation is an integral part of the employer's expenditure reduction efforts, as certified by the employer; (ii) Any compensation forgone by a member employed by the state or a local government during the 2011-2013 fiscal biennium as a result of reduced work hours, mandatory leave without pay, temporary layoffs, or reductions to current pay if the reduced compensation is an integral part of the employer's expenditure reduction efforts, as certified by the employer. Reductions to current pay shall not include elimination of previously agreed upon future salary increases; and (iii) Any compensation forgone by a member during the 2019-2021 and 2021-2023 fiscal biennia as a result of reduced work hours, mandatory leave without pay, temporary layoffs, furloughs, reductions to current pay, or other similar measures resulting from the COVID-19 budgetary crisis, if the reduced compensation is an integral part of the employer's expenditure reduction efforts, as certified by the employer. Reductions to current pay shall not include elimination of previously agreed upon future salary increases. (7)(a) "Beneficiary" for plan 1 members, means any person in receipt of a retirement allowance, pension or other benefit provided by this chapter. (b) "Beneficiary" for plan 2 and plan 3 members, means any person in receipt of a retirement allowance or other benefit provided by this chapter resulting from service rendered to an employer by another person. (8)(a) "Compensation earnable" for plan 1 members, means salaries or wages earned during a payroll period for personal services and where the compensation is not all paid in money, maintenance compensation shall be included upon the basis of the schedules established by the member's employer. (i) "Compensation earnable" for plan 1 members also includes the following actual or imputed payments, which are not paid for personal services: (A) Retroactive payments to an individual by an employer on reinstatement of the employee in a position, or payments by an employer to an individual in lieu of reinstatement in a position which are awarded or granted as the equivalent of the salary or wage which the individual would have earned during a payroll period shall be considered compensation earnable and the individual shall receive the equivalent service credit; (B) If a leave of absence is taken by an individual for the purpose of serving in the state legislature, the salary which would have been received for the position from which the leave of absence was taken, shall be considered as compensation earnable if the employee's contribution is paid by the employee and the employer's contribution is paid by the employer or employee; (C) Assault pay only as authorized by RCW 27.04.100, 72.01.045, and 72.09.240; (D) Compensation that a member would have received but for a disability occurring in the line of duty only as authorized by RCW 41.40.038; (E) Compensation that a member receives due to participation in the leave sharing program only as authorized by RCW 41.04.650 through 41.04.670; and (F) Compensation that a member receives for being in standby status. For the purposes of this section, a member is in standby status when not being paid for time actually worked and the employer requires the member to be prepared to report immediately for work, if the need arises, although the need may not arise. (ii) "Compensation earnable" does not include: (A) Remuneration for unused sick leave authorized under RCW 41.04.340, 28A.400.210, or 28A.310.490; (B) Remuneration for unused annual leave in excess of 240 hours. (b) "Compensation earnable" for plan 2 and plan 3 members, means salaries or wages earned by a member during a payroll period for personal services, including overtime payments, and shall include wages and salaries deferred under provisions established pursuant to sections 403(b), 414(h), and 457 of the United States Internal Revenue Code, but shall exclude nonmoney maintenance compensation and lump sum or other payments for deferred annual sick leave, unused accumulated vacation, unused accumulated annual leave, or any form of severance pay. "Compensation earnable" for plan 2 and plan 3 members also includes the following actual or imputed payments, which are not paid for personal services: (i) Retroactive payments to an individual by an employer on reinstatement of the employee in a position, or payments by an employer to an individual in lieu of reinstatement in a position which are awarded or granted as the equivalent of the salary or wage which the individual would have earned during a payroll period shall be considered compensation earnable to the extent provided above, and the individual shall receive the equivalent service credit; (ii) In any year in which a member serves in the legislature, the member shall have the option of having such member's compensation earnable be the greater of: (A) The compensation earnable the member would have received had such member not served in the legislature; or (B) Such member's actual compensation earnable received for nonlegislative public employment and legislative service combined. Any additional contributions to the retirement system required because compensation earnable under (b)(ii)(A) of this subsection is greater than compensation earnable under (b)(ii)(B) of this subsection shall be paid by the member for both member and employer contributions; (iii) Assault pay only as authorized by RCW 27.04.100, 72.01.045, and 72.09.240; (iv) Compensation that a member would have received but for a disability occurring in the line of duty only as authorized by RCW 41.40.038; (v) Compensation that a member receives due to participation in the leave sharing program only as authorized by RCW 41.04.650 through 41.04.670; and (vi) Compensation that a member receives for being in standby status. For the purposes of this section, a member is in standby status when not being paid for time actually worked and the employer requires the member to be prepared to report immediately for work, if the need arises, although the need may not arise. (9) "Department" means the department of retirement systems created in chapter 41.50 RCW. (10) "Director" means the director of the department. (11) "Eligible position" means: (a) Any position that, as defined by the employer, normally requires five or more months of service a year for which regular compensation for at least seventy hours is earned by the occupant thereof. For purposes of this chapter an employer shall not define "position" in such a manner that an employee's monthly work for that employer is divided into more than one position; (b) Any position occupied by an elected official or person appointed directly by the governor, or appointed by the chief justice of the supreme court under RCW 2.04.240(2) or 2.06.150(2), for which compensation is paid. (12) "Employee" or "employed" means a person who is providing services for compensation to an employer, unless the person is free from the employer's direction and control over the performance of work. The department shall adopt rules and interpret this subsection consistent with common law. (13)(a) "Employer" for plan 1 members, means every branch, department, agency, commission, board, and office of the state, any political subdivision or association of political subdivisions of the state admitted into the retirement system, and legal entities authorized by RCW 35.63.070 and 36.70.060 or chapter 39.34 RCW; and the term shall also include any labor guild, association, or organization the membership of a local lodge or division of which is comprised of at least forty percent employees of an employer (other than such labor guild, association, or organization) within this chapter. The term may also include any city of the first class that has its own retirement system. (b) "Employer" for plan 2 and plan 3 members, means every branch, department, agency, commission, board, and office of the state, and any political subdivision and municipal corporation of the state admitted into the retirement system, including public agencies created pursuant to RCW 35.63.070, 36.70.060, and 39.34.030; except that after August 31, 2000, school districts and educational service districts will no longer be employers for the public employees' retirement system plan 2. (c) Except as otherwise specifically provided in this chapter, "employer" does not include a government contractor. For purposes of this subsection, a "government contractor" is any entity, including a partnership, limited liability company, for-profit or nonprofit corporation, or person, that provides services pursuant to a contract with an "employer." The determination whether an employer-employee relationship has been established is not based on the relationship between a government contractor and an "employer," but is based solely on the relationship between a government contractor's employee and an "employer" under this chapter. (d) "Employer" does not include a comprehensive cancer center participating in a collaborative arrangement as defined in RCW 28B.10.930 that is operated in conformance with RCW 28B.10.930. (14) "Final compensation" means the annual rate of compensation earnable by a member at the time of termination of employment. (15) "Index" means, for any calendar year, that year's annual average consumer price index, Seattle, Washington area, for urban wage earners and clerical workers, all items, compiled by the bureau of labor statistics, United States department of labor. (16) "Index A" means the index for the year prior to the determination of a postretirement adjustment. (17) "Index B" means the index for the year prior to index A. (18) "Index year" means the earliest calendar year in which the index is more than 60 percent of index A. (19) "Ineligible position" means any position which does not conform with the requirements set forth in subsection (11) of this section. (20) "Leave of absence" means the period of time a member is authorized by the employer to be absent from service without being separated from membership. (21) "Member" means any employee included in the membership of the retirement system, as provided for in RCW 41.40.023. RCW 41.26.045 does not prohibit a person otherwise eligible for membership in the retirement system from establishing such membership effective when he or she first entered an eligible position. (22) "Member account" or "member's account" for purposes of plan 3 means the sum of the contributions and earnings on behalf of the member in the defined contribution portion of plan 3. (23) "Membership service" means: (a) All service rendered, as a member, after October 1, 1947; (b) All service after October 1, 1947, to any employer prior to the time of its admission into the retirement system for which member and employer contributions, plus interest as required by RCW 41.50.125, have been paid under RCW 41.40.056 or 41.40.057; (c) Service not to exceed six consecutive months of probationary service rendered after April 1, 1949, and prior to becoming a member, in the case of any member, upon payment in full by such member of the total amount of the employer's contribution to the retirement fund which would have been required under the law in effect when such probationary service was rendered if the member had been a member during such period, except that the amount of the employer's contribution shall be calculated by the director based on the first month's compensation earnable as a member; (d) Service not to exceed six consecutive months of probationary service, rendered after October 1, 1947, and before April 1, 1949, and prior to becoming a member, in the case of any member, upon payment in full by such member of five percent of such member's salary during said period of probationary service, except that the amount of the employer's contribution shall be calculated by the director based on the first month's compensation earnable as a member. (24) "New member" means a person who becomes a member on or after April 1, 1949, except as otherwise provided in this section. (25) "Original member" of this retirement system means: (a) Any person who became a member of the system prior to April 1, 1949; (b) Any person who becomes a member through the admission of an employer into the retirement system on and after April 1, 1949, and prior to April 1, 1951; (c) Any person who first becomes a member by securing employment with an employer prior to April 1, 1951, provided the member has rendered at least one or more years of service to any employer prior to October 1, 1947; (d) Any person who first becomes a member through the admission of an employer into the retirement system on or after April 1, 1951, provided, such person has been in the regular employ of the employer for at least six months of the 12-month period preceding the said admission date; (e) Any member who has restored all contributions that may have been withdrawn as provided by RCW 41.40.150 and who on the effective date of the individual's retirement becomes entitled to be credited with 10 years or more of membership service except that the provisions relating to the minimum amount of retirement allowance for the member upon retirement at age 70 as found in RCW 41.40.190(4) shall not apply to the member; (f) Any member who has been a contributor under the system for two or more years and who has restored all contributions that may have been withdrawn as provided by RCW 41.40.150 and who on the effective date of the individual's retirement has rendered five or more years of service for the state or any political subdivision prior to the time of the admission of the employer into the system; except that the provisions relating to the minimum amount of retirement allowance for the member upon retirement at age 70 as found in RCW 41.40.190(4) shall not apply to the member. (26) "Pension" means payments for life derived from contributions made by the employer. All pensions shall be paid in monthly installments. (27) "Plan 1" means the public employees' retirement system, plan 1 providing the benefits and funding provisions covering persons who first became members of the system prior to October 1, 1977. (28) "Plan 2" means the public employees' retirement system, plan 2 providing the benefits and funding provisions covering persons who first became members of the system on and after October 1, 1977, and are not included in plan 3. (29) "Plan 3" means the public employees' retirement system, plan 3 providing the benefits and funding provisions covering persons who: (a) First become a member on or after: (i) March 1, 2002, and are employed by a state agency or institute of higher education and who did not choose to enter plan 2; or (ii) September 1, 2002, and are employed by other than a state agency or institute of higher education and who did not choose to enter plan 2; or (b) Transferred to plan 3 under RCW 41.40.795. (30) "Prior service" means all service of an original member rendered to any employer prior to October 1, 1947. (31) "Regular interest" means such rate as the director may determine. (32) "Retiree" means any person who has begun accruing a retirement allowance or other benefit provided by this chapter resulting from service rendered to an employer while a member. (33) "Retirement" means withdrawal from active service with a retirement allowance as provided by this chapter. (34) "Retirement allowance" means the sum of the annuity and the pension. (35) "Retirement system" means the public employees' retirement system provided for in this chapter. (36) "Separation from service" occurs when a person has terminated all employment with an employer. Separation from service or employment does not occur, and if claimed by an employer or employee may be a violation of RCW 41.40.055, when an employee and employer have a written or oral agreement to resume employment with the same employer following termination. Mere expressions or inquiries about postretirement employment by an employer or employee that do not constitute a commitment to reemploy the employee after retirement are not an agreement under this subsection. (37)(a) "Service" for plan 1 members, except as provided in RCW 41.40.088, means periods of employment in an eligible position or positions for one or more employers rendered to any employer for which compensation is paid, and includes time spent in office as an elected or appointed official of an employer. Compensation earnable earned in full time work for 70 hours or more in any given calendar month shall constitute one service credit month except as provided in RCW 41.40.088. Compensation earnable earned for less than 70 hours in any calendar month shall constitute one-quarter service credit month of service except as provided in RCW 41.40.088. Only service credit months and one-quarter service credit months shall be counted in the computation of any retirement allowance or other benefit provided for in this chapter. Any fraction of a year of service shall be taken into account in the computation of such retirement allowance or benefits. Time spent in standby status, whether compensated or not, is not service. (i) Service by a state employee officially assigned by the state on a temporary basis to assist another public agency, shall be considered as service as a state employee: PROVIDED, That service to any other public agency shall not be considered service as a state employee if such service has been used to establish benefits in any other public retirement system. (ii) An individual shall receive no more than a total of 12 service credit months of service during any calendar year. If an individual is employed in an eligible position by one or more employers the individual shall receive no more than one service credit month during any calendar month in which multiple service for seventy or more hours is rendered. (iii) A school district employee may count up to 45 days of sick leave as creditable service solely for the purpose of determining eligibility to retire under RCW 41.40.180 as authorized by RCW 28A.400.300. For purposes of plan 1 "forty-five days" as used in RCW 28A.400.300 is equal to two service credit months. Use of less than 45 days of sick leave is creditable as allowed under this subsection as follows: (A) Less than 22 days equals one-quarter service credit month; (B) 22 days equals one service credit month; (C) More than 22 days but less than 45 days equals one and one-quarter service credit month. (iv) Reduction efforts such as furloughs, reduced work hours, mandatory leave without pay, temporary layoffs, or other similar situations as contemplated by subsection (6)(c)(iii) of this section do not result in a reduction in service credit that otherwise would have been earned for that month of work, and the member shall receive the full service credit for the hours that were scheduled to be worked before the reduction. (b) "Service" for plan 2 and plan 3 members, means periods of employment by a member in an eligible position or positions for one or more employers for which compensation earnable is paid. Compensation earnable earned for 90 or more hours in any calendar month shall constitute one service credit month except as provided in RCW 41.40.088. Compensation earnable earned for at least 70 hours but less than 90 hours in any calendar month shall constitute one-half service credit month of service. Compensation earnable earned for less than 70 hours in any calendar month shall constitute one-quarter service credit month of service. Time spent in standby status, whether compensated or not, is not service. Any fraction of a year of service shall be taken into account in the computation of such retirement allowance or benefits. (i) Service in any state elective position shall be deemed to be full time service, except that persons serving in state elective positions who are members of the Washington school employees' retirement system, teachers' retirement system, public safety employees' retirement system, or law enforcement officers' and firefighters' retirement system at the time of election or appointment to such position may elect to continue membership in the Washington school employees' retirement system, teachers' retirement system, public safety employees' retirement system, or law enforcement officers' and firefighters' retirement system. (ii) A member shall receive a total of not more than 12 service credit months of service for such calendar year. If an individual is employed in an eligible position by one or more employers the individual shall receive no more than one service credit month during any calendar month in which multiple service for ninety or more hours is rendered. (iii) Up to 45 days of sick leave may be creditable as service solely for the purpose of determining eligibility to retire under RCW 41.40.180 as authorized by RCW 28A.400.300. For purposes of plan 2 and plan 3 "forty-five days" as used in RCW 28A.400.300 is equal to two service credit months. Use of less than 45 days of sick leave is creditable as allowed under this subsection as follows: (A) Less than 11 days equals one-quarter service credit month; (B) 11 or more days but less than 22 days equals one-half service credit month; (C) 22 days equals one service credit month; (D) More than 22 days but less than 33 days equals one and one-quarter service credit month; (E) 33 or more days but less than 45 days equals one and one-half service credit month. (iv) Reduction efforts such as furloughs, reduced work hours, mandatory leave without pay, temporary layoffs, or other similar situations as contemplated by subsection (6)(c)(iii) of this section do not result in a reduction in service credit that otherwise would have been earned for that month of work, and the member shall receive the full service credit for the hours that were scheduled to be worked before the reduction. (38) "Service credit month" means a month or an accumulation of months of service credit which is equal to one. (39) "Service credit year" means an accumulation of months of service credit which is equal to one when divided by twelve. (40) "State actuary" or "actuary" means the person appointed pursuant to RCW 44.44.010(2). (41) "State elective position" means any position held by any person elected or appointed to statewide office or elected or appointed as a member of the legislature. (42) "State treasurer" means the treasurer of the state of Washington. (43) "Totally incapacitated for duty" means total inability to perform the duties of a member's employment or office or any other work for which the member is qualified by training or experience. [ 2024 c 151 s 3; 2022 c 71 s 8; 2021 c 12 s 7; 2012 c 236 s 6; 2011 1st sp.s. c 5 s 5. Prior: 2010 2nd sp.s. c 1 s 906; 2009 c 430 s 1; 2007 c 50 s 4; 2004 c 242 s 53; 2003 c 412 s 4; 2000 c 247 s 102; 1998 c 341 s 601; prior: 1997 c 254 s 10; 1997 c 88 s 6; prior: 1995 c 345 s 10; 1995 c 286 s 1; 1995 c 244 s 3; prior: 1994 c 298 s 2; 1994 c 247 s 5; 1994 c 197 s 23; 1994 c 177 s 8; 1993 c 95 s 8; prior: 1991 c 343 s 6; 1991 c 35 s 70; 1990 c 274 s 3; prior: 1989 c 309 s 1; 1989 c 289 s 1; 1985 c 13 s 7; 1983 c 69 s 1; 1981 c 256 s 6; 1979 ex.s. c 249 s 7; 1977 ex.s. c 295 s 16; 1973 1st ex.s. c 190 s 2; 1972 ex.s. c 151 s 1; 1971 ex.s. c 271 s 2; 1969 c 128 s 1; 1965 c 155 s 1; 1963 c 225 s 1; 1963 c 174 s 1; 1961 c 291 s 1; 1957 c 231 s 1; 1955 c 277 s 1; 1953 c 200 s 1; 1951 c 50 s 1; 1949 c 240 s 1; 1947 c 274 s 1; Rem. Supp. 1949 s 11072-1.] NOTES: Findings— RCW 41.40.015 Construction—Chapter applicable to state registered domestic partnerships—2009 c 521. For the purposes of this chapter, the terms spouse, marriage, marital, husband, wife, widow, widower, next of kin, and family shall be interpreted as applying equally to state registered domestic partnerships or individuals in state registered domestic partnerships as well as to marital relationships and married persons, and references to dissolution of marriage shall apply equally to state registered domestic partnerships that have been terminated, dissolved, or invalidated, to the extent that such interpretation does not conflict with federal law. Where necessary to implement chapter 521, Laws of 2009, gender-specific terms such as husband and wife used in any statute, rule, or other law shall be construed to be gender neutral, and applicable to individuals in state registered domestic partnerships. [ 2009 c 521 s 99.] NOTES: Effective dates— RCW 41.40.020 System created—Administration. A state employees' retirement system is hereby created for the employees of the state of Washington and its political subdivisions. The administration and management of the retirement system, the responsibility for making effective the provisions of this chapter, and the authority to make all rules and regulations necessary therefor are hereby vested in the department. All such rules and regulations shall be governed by the provisions of chapter 34.05 RCW, as now or hereafter amended. The retirement system herein provided for shall be known as the Washington Public Employees' Retirement System. [ 1991 c 35 s 71; 1969 c 128 s 2; 1967 c 127 s 1; 1949 c 240 s 2; 1947 c 274 s 2; Rem. Supp. 1949 s 11072-2.] NOTES: Intent— RCW 41.40.023 Membership. (Effective until January 1, 2027.) Membership in the retirement system shall consist of all regularly compensated employees and appointive and elective officials of employers, as defined in this chapter, with the following exceptions: (1) Persons in ineligible positions; (2) Employees of the legislature except the officers thereof elected by the members of the senate and the house and legislative committees, unless membership of such employees be authorized by the said committee; (3)(a) Persons holding elective offices or persons appointed directly by the governor: PROVIDED, That such persons shall have the option of applying for membership during such periods of employment: AND PROVIDED FURTHER, That any persons holding or who have held elective offices or persons appointed by the governor who are members in the retirement system and who have, prior to becoming such members, previously held an elective office, and did not at the start of such initial or successive terms of office exercise their option to become members, may apply for membership to be effective during such term or terms of office, and shall be allowed to establish the service credit applicable to such term or terms of office upon payment of the employee contributions therefor by the employee with interest as determined by the director and employer contributions therefor by the employer or employee with interest as determined by the director: AND PROVIDED FURTHER, That all contributions with interest submitted by the employee under this subsection shall be placed in the employee's individual account in the employee's savings fund and be treated as any other contribution made by the employee, with the exception that any contributions submitted by the employee in payment of the employer's obligation, together with the interest the director may apply to the employer's contribution, shall not be considered part of the member's annuity for any purpose except withdrawal of contributions; (b) A member holding elective office who has elected to apply for membership pursuant to (a) of this subsection and who later wishes to be eligible for a retirement allowance shall have the option of ending his or her membership in the retirement system. A member wishing to end his or her membership under this subsection must file, on a form supplied by the department, a statement indicating that the member agrees to irrevocably abandon any claim for service for future periods served as an elected official. A member who receives more than fifteen thousand dollars per year in compensation for his or her elective service, adjusted annually for inflation by the director, is not eligible for the option provided by this subsection (3)(b); (4) Employees holding membership in, or receiving pension benefits under, any retirement plan operated wholly or in part by an agency of the state or political subdivision thereof, or who are by reason of their current employment contributing to or otherwise establishing the right to receive benefits from any such retirement plan except as follows: (a) In any case where the retirement system has in existence an agreement with another retirement system in connection with exchange of service credit or an agreement whereby members can retain service credit in more than one system, such an employee shall be allowed membership rights should the agreement so provide; (b) An employee shall be allowed membership if otherwise eligible while receiving survivor's benefits; (c) An employee shall not either before or after June 7, 1984, be excluded from membership or denied service credit pursuant to this subsection solely on account of: (i) Membership in the plan created under chapter 2.14 RCW; or (ii) enrollment under the relief and compensation provisions or the pension provisions of the volunteer firefighters' relief and pension principal fund or the reserve officers' relief and pension principal fund under chapter 41.24 RCW; (d) Except as provided in RCW 41.40.109, on or after July 25, 1999, an employee shall not be excluded from membership or denied service credit pursuant to this subsection solely on account of participation in a defined contribution pension plan qualified under section 401 of the internal revenue code; (e) Employees who have been reported in the retirement system prior to July 25, 1999, and who participated during the same period of time in a defined contribution pension plan qualified under section 401 of the internal revenue code and operated wholly or in part by the employer, shall not be excluded from previous retirement system membership and service credit on account of such participation; (5) Patient and inmate help in state charitable, penal, and correctional institutions; (6) "Members" of a state veterans' home or state soldiers' home; (7) Persons employed by an institution of higher learning or community college, primarily as an incident to and in furtherance of their education or training, or the education or training of a spouse; (8) Employees of an institution of higher learning or community college during the period of service necessary to establish eligibility for membership in the retirement plans operated by such institutions; (9) Persons rendering professional services to an employer on a fee, retainer, or contract basis or when the income from these services is less than fifty percent of the gross income received from the person's practice of a profession; (10) Persons appointed after April 1, 1963, by the liquor and cannabis board as contract liquor store managers; (11) Employees of a labor guild, association, or organization: PROVIDED, That elective officials and employees of a labor guild, association, or organization which qualifies as an employer within this chapter shall have the option of applying for membership; (12) Retirement system retirees: PROVIDED, That following reemployment in an eligible position, a retiree may elect to prospectively become a member of the retirement system if otherwise eligible; (13) Persons employed by or appointed or elected as an official of a first-class city that has its own retirement system: PROVIDED, That any member elected or appointed to an elective office on or after April 1, 1971, shall have the option of continuing as a member of this system in lieu of becoming a member of the city system. A member who elects to continue as a member of this system shall pay the appropriate member contributions and the city shall pay the employer contributions at the rates prescribed by this chapter. The city shall also transfer to this system all of such member's accumulated contributions together with such further amounts as necessary to equal all employee and employer contributions which would have been paid into this system on account of such service with the city and thereupon the member shall be granted credit for all such service. Any city that becomes an employer as defined in RCW 41.40.010(13) as the result of an individual's election under this subsection shall not be required to have all employees covered for retirement under the provisions of this chapter. Nothing in this subsection shall prohibit a city of the first class with its own retirement system from: (a) Transferring all of its current employees to the retirement system established under this chapter, or (b) allowing newly hired employees the option of continuing coverage under the retirement system established by this chapter. Notwithstanding any other provision of this chapter, persons transferring from employment with a first-class city of over four hundred thousand population that has its own retirement system to employment with the state department of agriculture may elect to remain within the retirement system of such city and the state shall pay the employer contributions for such persons at like rates as prescribed for employers of other members of such system; (14) Employees who (a) are not citizens of the United States, (b) do not reside in the United States, and (c) perform duties outside of the United States; (15) Employees who (a) are not citizens of the United States, (b) are not covered by chapter 41.48 RCW, (c) are not excluded from membership under this chapter or chapter 41.04 RCW, (d) are residents of this state, and (e) make an irrevocable election to be excluded from membership, in writing, which is submitted to the director within thirty days after employment in an eligible position; (16) Employees who are citizens of the United States and who reside and perform duties for an employer outside of the United States: PROVIDED, That unless otherwise excluded under this chapter or chapter 41.04 RCW, the employee may apply for membership (a) within thirty days after employment in an eligible position and membership service credit shall be granted from the first day of membership service, and (b) after this thirty-day period, but membership service credit shall be granted only if payment is made for the noncredited membership service under RCW 41.50.165(2), otherwise service shall be from the date of application; (17) The city manager or chief administrative officer of a city or town, other than a retiree, who serves at the pleasure of an appointing authority: PROVIDED, That such persons shall have the option of applying for membership within thirty days from date of their appointment to such positions. Persons serving in such positions as of April 4, 1986, shall continue to be members in the retirement system unless they notify the director in writing prior to December 31, 1986, of their desire to withdraw from membership in the retirement system. A member who withdraws from membership in the system under this section shall receive a refund of the member's accumulated contributions. Persons serving in such positions who have not opted for membership within the specified thirty days, may do so by paying the amount required under RCW 41.50.165(2) for the period from the date of their appointment to the date of acceptance into membership; (18) Persons serving as: (a) The chief administrative officer of a public utility district as defined in RCW 54.16.100; (b) the chief administrative officer of a port district formed under chapter 53.04 RCW; or (c) the chief administrative officer of a county who serves at the pleasure of an appointing authority: PROVIDED, That such persons shall have the option of applying for membership within thirty days from the date of their appointment to such positions. Persons serving in such positions as of July 25, 1999, shall continue to be members in the retirement system unless they notify the director in writing prior to December 31, 1999, of their desire to withdraw from membership in the retirement system. A member who withdraws from membership in the system under this section shall receive a refund of the member's accumulated contributions upon termination of employment or as otherwise consistent with the plan's tax qualification status as defined in internal revenue code section 401. Persons serving in such positions who have not opted for membership within the specified thirty days, may do so at a later date by paying the amount required under RCW 41.50.165(2) for the period from the date of their appointment to the date of acceptance into membership; (19) Persons enrolled in state-approved apprenticeship programs, authorized under chapter 49.04 RCW, and who are employed by local governments to earn hours to complete such apprenticeship programs, if the employee is a member of a union-sponsored retirement plan and is making contributions to such a retirement plan or if the employee is a member of a Taft-Hartley retirement plan; (20) Beginning on July 22, 2001, persons employed exclusively as trainers or trainees in resident apprentice training programs operated by housing authorities authorized under chapter 35.82 RCW, (a) if the trainer or trainee is a member of a union-sponsored retirement plan and is making contributions to such a retirement plan or (b) if the employee is a member of a Taft-Hartley retirement plan; (21) Employees who are removed from membership under RCW 41.40.823 or 41.40.633; (22) Persons employed as the state director of fire protection under RCW 43.43.938 who were previously members of the law enforcement officers' and firefighters' retirement system plan 2 under chapter 41.26 RCW may continue as a member of the law enforcement officers' and firefighters' retirement system in lieu of becoming a member of this system; and (23) Persons hired on or after June 6, 2024, employed by a public transportation benefit area as defined in RCW 36.57A.010 as part-time bus drivers serving naval shipyards if the employee is simultaneously employed on a full-time basis with an employer of the federal government and is making contributions to the federal employees' retirement system. [ 2024 c 247 s 1; 2010 c 80 s 1. Prior: 2005 c 151 s 12; 2005 c 131 s 7; 2001 c 37 s 1; prior: 1999 c 286 s 2; 1999 c 244 s 1; 1997 c 254 s 11; prior: 1994 c 298 s 8; 1994 c 197 s 24; 1993 c 319 s 1; prior: 1990 c 274 s 10; 1990 c 192 s 4; 1988 c 109 s 25; 1987 c 379 s 1; 1986 c 317 s 5; 1984 c 184 s 13; 1984 c 121 s 1; 1982 1st ex.s. c 52 s 19; 1975 c 33 s 6; 1974 ex.s. c 195 s 2; 1973 1st ex.s. c 190 s 5; 1971 ex.s. c 271 s 4; 1969 c 128 s 5; 1967 c 127 s 3; 1965 c 155 s 2; 1963 c 225 s 2; 1963 c 210 s 1; 1957 c 231 s 2; 1955 c 277 s 2; 1953 c 200 s 5; 1951 c 50 s 2; 1949 c 240 s 7; 1947 c 274 s 13; Rem. Supp. 1949 s 11072-13. Formerly RCW 41.40.120.] NOTES: Effective date— RCW 41.40.025 Membership in system—Charter school employers and employees. This section designates charter schools established under chapter 28A.710 RCW as employers and charter school employees as members, and applies only if the department of retirement systems receives determinations from the internal revenue service and the United States department of labor that participation does not jeopardize the status of these retirement systems as governmental plans under the federal employees' retirement income security act and the internal revenue code. [ 2016 c 241 s 135. Prior: 2013 c 2 s 305 (Initiative Measure No. 1240, approved November 6, 2012).] NOTES: Effective date— RCW 41.40.028 Nonelective position employees employed for at least nine months—Deemed in eligible position, when. Any person who has been employed in a nonelective position for at least nine months and who has made member contributions required under this chapter throughout such period, shall be deemed to have been in an eligible position during such period of employment. [ 1980 c 112 s 2. Formerly RCW 41.40.123.] RCW 41.40.034 Purchase of additional service credit—Costs—Rules. (1) A member eligible to retire under RCW 41.40.180, 41.40.630, or 41.40.820 may, at the time of filing a written application for retirement with the department, apply to the department to make a one-time purchase of up to five years of additional service credit. (2) To purchase additional service credit under this section, a member shall pay the actuarial equivalent value of the resulting increase in the member's benefit. (3) Subject to rules adopted by the department, a member purchasing additional service credit under this section may pay all or part of the cost with a lump sum payment, eligible rollover, direct rollover, or trustee-to-trustee transfer from an eligible retirement plan. The department shall adopt rules to ensure that all lump sum payments, rollovers, and transfers comply with the requirements of the internal revenue code and regulations adopted by the internal revenue service. The rules adopted by the department may condition the acceptance of a rollover or transfer from another plan on the receipt of information necessary to enable the department to determine the eligibility of any transferred funds for tax-free rollover treatment or other treatment under federal income tax law. (4) Additional service credit purchased under this section is not membership service and shall be used exclusively to provide the member with a monthly annuity that is paid in addition to the member's retirement allowance. [ 2006 c 214 s 1.] NOTES: Effective date— RCW 41.40.035 Service credit prohibited for certain members of committees, boards, and commissions and for certain appointive and elective officials. (1) No person appointed to membership on any committee, board, or commission on or after July 1, 1976, who is compensated for service on such committee, board, or commission for fewer than ten days or seventy hours in any month, whichever amount is less, shall receive service credit for such service for that month: PROVIDED, That on and after October 1, 1977, appointive and elective officials who receive monthly compensation earnable from an employer in an amount equal to or less than ninety times the state minimum hourly wage shall not receive any service credit for such employment. (2) No person appointed on or after June 9, 2022, to membership on any committee, board, or commission described in RCW 43.03.220 may receive service credit for service on such committee, board, or commission due to the payment of a stipend or allowance as authorized under RCW 43.03.220. (3) This section does not apply to any person serving on a committee, board, or commission on June 30, 1976, who continued such service until subsequently appointed by the governor to a different committee, board, or commission. [ 2022 c 245 s 8; 1987 c 146 s 1; 1977 ex.s. c 295 s 17; 1975-'76 2nd ex.s. c 34 s 4. Formerly RCW 41.40.165.] NOTES: Findings— RCW 41.40.037 Service by retirees—Break in employment requirement—Reduction of retirement allowance upon reemployment—Reestablishment of membership. (Effective until June 30, 2029.) (1)(a) If a retiree enters employment with an employer sooner than one calendar month after his or her accrual date, the retiree's monthly retirement allowance will be reduced by five and one-half percent for every eight hours worked during that month. This reduction will be applied each month until the retiree remains absent from employment with an employer for one full calendar month. (b) The benefit reduction provided in (a) of this subsection will accrue for a maximum of one hundred sixty hours per month. Any benefit reduction over one hundred percent will be applied to the benefit the retiree is eligible to receive in subsequent months. (2)(a) A retiree from plan 1, plan 2, or plan 3 who has satisfied the break in employment requirement of subsection (1) of this section may work up to eight hundred sixty-seven hours per calendar year in an eligible position, as defined in RCW 41.32.010, 41.35.010, 41.37.010, or 41.40.010, or as a firefighter or law enforcement officer, as defined in RCW 41.26.030, or in a position covered by annuity and retirement income plans offered by institutions of higher education pursuant to RCW 28B.10.400, without suspension of his or her benefit. (b) Between March 23, 2022, and January 1, 2030, a retiree, including a retiree who has retired under the alternate early retirement provisions of RCW 41.40.630(3)(b) or 41.40.820(3)(b), who reenters employment more than 100 days after his or her accrual date, and who enters service in a school district in a nonadministrative position shall continue to receive pension payments while engaged in such service, until the retiree has rendered service for more than 1,040 hours in a calendar year. (c) Between April 14, 2023, and July 1, 2026, a retiree, including a retiree who has retired under the alternate early retirement provisions of RCW 41.40.630(3)(b) or 41.40.820(3)(b), and who enters service in a nonadministrative position as a licensed nurse for a state agency, shall continue to receive pension payments while engaged in such service, until the retiree has rendered service for more than 1,040 hours in a calendar year. (3) If the retiree opts to reestablish membership under RCW 41.40.023(12), he or she terminates his or her retirement status and becomes a member. Retirement benefits shall not accrue during the period of membership and the individual shall make contributions and receive membership credit. Such a member shall have the right to again retire if eligible in accordance with RCW 41.40.180. However, if the right to retire is exercised to become effective before the member has rendered two uninterrupted years of service, the retirement formula and survivor options the member had at the time of the member's previous retirement shall be reinstated. (4) The department shall collect and provide the state actuary with information relevant to the use of this section for the select committee on pension policy. (5) The legislature reserves the right to amend or repeal this section in the future and no member or beneficiary has a contractual right to be employed for more than five months in a calendar year without a reduction of his or her pension. [ 2025 c 284 s 5; 2023 c 99 s 2; 2022 c 110 s 5; 2015 c 75 s 1; 2011 1st sp.s. c 47 s 19; 2007 c 50 s 5; 2005 c 319 s 103; 2004 c 242 s 63. Prior: 2003 c 412 s 5; 2003 c 295 s 7; 2001 2nd sp.s. c 10 s 4; (2001 2nd sp.s. c 10 s 12 repealed by 2002 c 26 s 9); 1997 c 254 s 14.] NOTES: Effective date— RCW 41.40.038 Duty disability retirement recipients—Continued service credit. Those members subject to this chapter who became disabled in the line of duty on or after March 27, 1984, and who received or are receiving benefits under Title 51 RCW or a similar federal workers' compensation program shall receive or continue to receive service credit subject to the following: (1) No member may receive more than one month's service credit in a calendar month. (2) No service credit under this section may be allowed after a member separates or is separated without leave of absence. (3) Employer contributions shall be paid by the employer at the rate in effect for the period of the service credited. (4) Employee contributions shall be collected by the employer and paid to the department at the rate in effect for the period of service credited. (5) Contributions shall be based on the regular compensation which the member would have received had the disability not occurred. If contribution payments are made retroactively, interest shall be charged at the rate set by the director on both employee and employer contributions. No service credit shall be granted until the employee contribution has been paid. (6) The service and compensation credit shall not be granted for a period to exceed twenty-four consecutive months. (7) Nothing in this section shall abridge service credit rights granted in RCW 41.40.220(2) and 41.40.320. (8) Should the legislature revoke the service credit authorized under this section or repeal this section, no affected employee is entitled to receive the credit as a matter of contractual right. [ 2005 c 363 s 1; 1987 c 118 s 1; 1986 c 176 s 2. Formerly RCW 41.40.223.] RCW 41.40.042 Members agree to deductions. The deductions from the compensation of members, provided for in RCW 41.40.330, 41.45.060, 41.45.061, or 41.45.067, shall be made notwithstanding that the minimum compensation provided for by law for any member shall be reduced thereby. Every member shall be deemed to consent and agree to the deductions made and provided for in this chapter and receipt in full for his or her salary or compensation, and payment less the deductions shall be a full and complete discharge and acquittance of all claims and demands whatsoever for the services rendered by the person during the period covered by the payment, except as to benefits provided for under this chapter. [ 2000 c 247 s 103; 1991 c 35 s 89; 1977 ex.s. c 295 s 18; 1947 c 274 s 35; Rem. Supp. 1947 s 11072-35. Formerly RCW 41.40.340.] NOTES: Intent— RCW 41.40.048 Employer's contribution—Computation—Billing. (1) The director shall report to each employer the contribution rates required for the ensuing biennium or fiscal year, whichever is applicable. (2) Beginning September 1, 1990, the amount to be collected as the employer's contribution shall be computed by applying the applicable rates established in chapter 41.45 RCW to the total compensation earnable of employer's members as shown on the current payrolls of the said employer. In addition, the director shall determine and collect the additional employer contribution rate necessary to fund the benefits granted officials holding office pursuant to Articles II and III of the Constitution of the state of Washington and RCW 48.02.010. Each said employer shall compute at the end of each month the amount due for that month and the same shall be paid as are its other obligations. Effective January 1, 1987, however, no contributions are required for any calendar month in which the member is not granted service credit. (3) In the event of failure, for any reason, of an employer other than a political subdivision of the state to have remitted amounts due for membership service of any of the employer's members rendered during a prior biennium, the director shall bill such employer for such employer's contribution together with such charges as the director deems appropriate in accordance with RCW 41.50.120. Such billing shall be paid by the employer as, and the same shall be, a proper charge against any moneys available or appropriated to such employer for payment of current biennial payrolls. [ 1989 c 273 s 23; 1986 c 268 s 5; 1985 c 138 s 1; 1982 1st ex.s. c 52 s 22; 1979 c 151 s 63; 1977 ex.s. c 295 s 20; 1963 c 126 s 1; 1961 c 291 s 12; 1949 c 240 s 26; 1947 c 274 s 38; Rem. Supp. 1947 s 11072-38. Formerly RCW 41.40.370.] NOTES: Effective dates— RCW 41.40.052 Exemption from taxation and judicial process—Exceptions—Assignability—Deductions authorized. (1) Subject to subsections (2), (3), and (4) of this section, the right of a person to a pension, an annuity, or retirement allowance, any optional benefit, any other right accrued or accruing to any person under the provisions of this chapter, the various funds created by this chapter, and all moneys and investments and income thereof, are hereby exempt from any state, county, municipal, or other local tax, and shall not be subject to execution, garnishment, attachment, the operation of bankruptcy or insolvency laws, or other process of law whatsoever, whether the same be in actual possession of the person or be deposited or loaned and shall be unassignable. (2)(a) This section shall not be deemed to prohibit a beneficiary of a retirement allowance from authorizing deductions therefrom for payment of premiums due on any group insurance policy or plan issued for the benefit of a group comprised of public employees of the state of Washington or its political subdivisions and which has been approved for deduction in accordance with rules that may be adopted by the state health care authority and/or the department, and this section shall not be deemed to prohibit a beneficiary of a retirement allowance from authorizing deductions therefrom for payment of dues and other membership fees to any retirement association or organization the membership of which is composed of retired public employees, if a total of three hundred or more of such retired employees have authorized such deduction for payment to the same retirement association or organization. (b) This section does not prohibit a beneficiary of a retirement allowance from authorizing deductions from that allowance for charitable purposes on the same terms as employees and public officers under RCW 41.04.035 and 41.04.036. (3) Subsection (1) of this section shall not prohibit the department from complying with (a) a wage assignment order for child support issued pursuant to chapter 26.18 RCW, (b) an order to withhold and deliver issued pursuant to chapter 74.20A RCW, (c) an income withholding order issued pursuant to RCW 26.23.060, (d) a mandatory benefits assignment order issued by the department, (e) a court order directing the department of retirement systems to pay benefits directly to an obligee under a dissolution order as defined in RCW 41.50.500(3) which fully complies with RCW 41.50.670 and 41.50.700, or (f) any administrative or court order expressly authorized by federal law. (4) Subsection (1) of this section does not exempt any pension or other benefit received under this chapter from tax under Title 82A RCW. [ 2026 c 238 s 810; 2012 c 159 s 26; 1999 c 83 s 1. Prior: 1991 c 365 s 22; 1991 c 35 s 92; 1989 c 360 s 27; 1988 c 107 s 20; 1987 c 326 s 24; 1982 c 135 s 2; 1981 c 294 s 14; 1979 ex.s. c 205 s 6; 1974 ex.s. c 195 s 4; 1967 c 127 s 6; 1947 c 274 s 39; Rem. Supp. 1947 s 11072-39. Formerly RCW 41.40.380.] NOTES: Findings— RCW 41.40.054 Disability retirement—Criminal conduct. A member shall not receive a disability retirement benefit under RCW 41.40.200, 41.40.220, 41.40.230, 41.40.235, 41.40.250, 41.40.670, or 41.40.825 if the disability is the result of criminal conduct by the member committed after April 21, 1997. [ 2000 c 247 s 104; 1997 c 103 s 3.] NOTES: Severability— RCW 41.40.055 Penalty for false statements. Any person who shall knowingly make any false statements, or shall falsify or permit to be falsified any record or records of this retirement system in any attempt to defraud the retirement system as a result of such act, shall be guilty of a gross misdemeanor. [ 1947 c 274 s 41; Rem. Supp. 1947 s 11072-41. Formerly RCW 41.40.400.] RCW 41.40.056 Establishment of service credit—Former employees—Employers admitted before July 23, 1995. Except as qualified by RCW 41.40.023, for employers that were admitted into the retirement system before July 23, 1995, membership service may be established for the employer's former employees who are active members of the system if the member or member's former employer pays an amount equal to the employer and member contributions which would have been paid to the retirement system on account of such service to the retirement system. Payment shall be made prior to the retirement of such member. Payments submitted by the member under this section shall be placed in the member's individual account in the members' savings fund and be treated as any other contribution made by the member, with the exception that the contributions submitted by the member in payment of the employer's obligation, together with the interest the director may apply to the employer's contribution, shall be excluded from the calculation of the member's annuity in the event the member selects a benefit with an annuity option. [ 1995 c 286 s 2.] RCW 41.40.057 Establishment of service credit—Current and former employees—Employers admitted after July 23, 1995. (1) This section applies to the establishment of membership service with employers admitted to the retirement system after July 23, 1995. (2) For current employees, membership service may be established for periods of employment with an employer prior to the employer's admission into the retirement system by making the payments required by this section. The employer must select one of the options in this subsection and apply it uniformly, except as provided in subsection (3) of this section. The required payment shall include the total member and employer contributions that would have been required from the date of each current member's hire. (a) Option A: The employer makes all the required payments within fifteen years from the date of the employer's admission. (b) Option B: The employer makes a portion of the required payments and the member pays the balance. The employer shall not be required to make its payments until the member has made his or her payments. Each member shall have the option to purchase the membership service. (c) Option C: The member makes all of the required payments. Each member shall have the option to purchase the membership service. All payments under options B and C of this subsection must be completed within five years from the date of the employer's admission, or prior to the retirement of the