SECTION 590:10-7-18. Post-retirement employment - eligibility

(a)   Retiree subject to restrictions. Returning to work for a participating employer may affect the retirement benefit of a retiree. A retiree returning to work for a participating employer is subject to various state and federal restrictions, including, but not limited to, the requirements set forth in 74 O.S. §914 and certain Internal Revenue Service regulations.

(b)   Bona fide termination of employment. Prior to the payment of any retirement benefit to a member, the participating employer shall certify in writing to the System that the member has terminated employment. Termination of employment shall be governed by guidelines and regulations set forth by the Internal Revenue Service, and shall generally mean the member must have experienced a bona fide separation, severance or termination of employment or service in which the employer and employee relationship is completely severed. Changing from full-time to part-time employment with the same participating employer does not qualify as a bona fide termination.

(c)   Returning to work for former employer. A retiree may not be rehired in any capacity by the retiree's same participating employer for a period of one (1) year after the retiree ended his or her employment with such same participating employer. A retiree may not enter into an employment contract of any kind, including through a third party, with the same participating employer for a period of one (1) year after ending his or her employment with such same participating employer. The provisions of this subsection shall not apply if the retiree waives his or her benefit as provided under 74 O.S. §914(E)(2).

(d)   Pre-arranged rehires. If any agreement is made between the employee and the employer prior to the retirement of the employee which would allow the employee to return to work for the same participating employer, the retirement of such employee shall not be considered a bona fide termination of employment. Upon discovery of such an agreement, the employee shall be subject to having the retirement benefits stopped pursuant to 74 O.S. §914(D).

(e)   Independent contractors.

(1)   A retired member who provides services as an independent contractor to a participating employer shall not participate in the System. However, the employer must submit a copy of the contract to OPERS for approval in advance of the effective date of the contract. The contract must be a true contract labor situation where the individual engages to perform certain services according to his or her own method and manner, free from control and direction of the employer in the performance of the service except the result thereof. Review of the contract shall include, but not be limited to:

(A)   the degree of the right to control or supervise the work of the individual;

(B)   payment of self-employment taxes;

(C)   whether any benefits or leave time are paid;

(D)   the nature and length of the contract;

(E)   whether the work is part of the regular business of the employer, and;

(F)   the right of either party to terminate the relationship without liability.

(2)   If an individual after retirement is doing the same work for the same employer as the individual did prior to retirement, the System will consider the individual to be an employee and not an independent contractor. In no event will an employment contract be accepted by the System if it is determined that the contract was arranged or agreed to prior to the retirement of the employee. In such cases, the System will consider the relationship to be that of employer and employee, and the employer and employee will be subject to the laws and rules regarding post-retirement employment.

[Source: Added at 25 Ok Reg 1001, eff 5-11-08; Amended at 26 Ok Reg 120, eff 9-18-08 (emergency); Amended at 26 Ok Reg 952, eff 4-25-09; Amended at 28 Ok Reg 95, eff 9-17-10 (emergency); Amended at 28 Ok Reg 664, eff 5-12-11]