A. Except as otherwise provided by subsection B of this section, employers of employees who become participants in the defined contribution retirement system shall match the employee contribution paid on a monthly or more frequent basis at the rate of six percent (6.0%) based on the same compensation amount used to compute the employee contribution amount.
B. If an employee selects a contribution rate of seven percent (7.0%) or more, but not higher than allowed pursuant to the maximum annual contribution limit prescribed by Section 415 of the Internal Revenue Code of 1986, as amended, the employer matching amount shall be seven percent (7.0%).
C. The initial four and five-tenths percent (4.5%) employee contribution shall be the only mandatory contribution of an employee participating in the defined contribution retirement system created by this act. These funds shall be placed by the System in either a 401(a) plan or a 457(b) plan, to be determined by the Board to maintain the plan consistent with the Internal Revenue Code. Any employee contributions eligible to be matched under this section over the four and five-tenths percent (4.5%) initial contribution shall be considered voluntary deferrals of compensation and placed in a 457(b) plan. All employer matching funds shall be placed in a 401(a) plan.
Any contribution rate that is more than the four and five-tenths percent (4.5%) rate can be chosen by the participating employee upon the employee's initial participation, and can be changed once per month. The employee contribution rate chosen shall continue until the employee elects to change the contribution rate or terminates service or retires.
D. The employer match as set forth in subsection A of this section may be increased at any time by the Legislature without affecting the then-existing rights of participating employees and beneficiaries in order to encourage participating employees to accumulate deferred income reserves for themselves and their dependents. The employer match may be decreased at any time by the Legislature without affecting the then-existing rights of participating employees and beneficiaries in order to provide funding as may be needed to reduce the unfunded liabilities of the defined benefit plan as set forth in Section 901 et seq. of this title, but shall not be less than six percent (6.0%) for any year during which the defined contribution plan is maintained.
Added by Laws 2014, c. 375, § 5, eff. Nov. 1, 2014. Amended by Laws 2015, c. 303, § 3, eff. Nov. 1, 2015; Laws 2016, c. 267, § 1, eff. Nov. 1, 2016.