Pension Contracts Frequently Asked Questions

A contract amendment is a prospective revision of the pension benefits a contracting agency elects to change within its contract. The pension benefits for which an agency can amend its contract is included in the Option Benefits Listing. Depending on the benefit type, the contract amendment process can take up to 6 months because of the additional time needed to obtain an actuarial valuation. For contract amendments not requiring an actuarial valuation report, the process can is approximately 3-4 months depending on how often the agency’s governing board meets.

The contract amendment can be initiated in the following ways:

• Contacting CalPERS Contact Center at (888) 225-7377
• A direct inquiry to the CalPERS Contract Analyst for the agency
• Submitting an email to the Pension Contracts Team at pensioncontracts@calpers.ca.gov
• Utilizing the myCalPERS system

The Public Employees Retirement Law (PERL) allows for two methods of employees sharing additional cost (cost share) of the employer contribution:

• “Informal” cost share under GC 20516(f), allows employers that lawfully agree with represented employees to have those employees pay an additional percentage above the normal employee contribution towards the employer rate separate of CalPERS involvement. There is no requirement for this type of cost share to be included in agency’s contract; as a result, the additional employee contributions are not reportable to CalPERS and are not credited to the employee’s account(s).
• “Formal” cost share under Government Code section (GC) 20516(b), which allows employers that lawfully agree to have its represented and unrepresented employees pay a specific percentage above the normal employee contribution towards the employer rate. Formal cost share requires an amendment to the agency’s pension contract to include CG 20516 with the identified cost share percentage and applicable group. Amending the pension contract to include cost share allows the employer to report the additional member contributions to PERS and is credited to the member’s account.

Contact our team to address questions related specifically to your agency.

With the enactment of the Public Employees’ Pension Reform Act (PEPRA), classic benefit packages were ‘frozen’ as of December 31, 2012. PEPRA precludes any changes made to classic benefit packages.

1. For Public Agency employers, the agency must first amend its contract to include, if it does not already have Government Code Section 20903, within its contract.
2. School Employers are permitted to enact a Golden Handshake via Section 20904.
3. The initiation of the process can be accomplished via the myCalPERS system, or through a contact as noted within this FAQ.