New Members

CONTRIBUTION RATES

Public retirement is state-mandated for nearly all full-time public employees since they are not eligible to contribute to Social Security. Membership in the Fitchburg Retirement System is mandatory for employees scheduled to work twenty (20) hours or more per week for at least thirty (30) weeks. All members in service make mandatory pre-tax contributions through payroll deductions. Pension contribution rates are set by Massachusetts General Law c.32, §22 and determined by the date you become a member of a public sector retirement system. Please refer to the chart below for reference.

The pension contribution rate on regular compensation for individuals whose membership began on or after July 1, 1996, is nine percent (9%). Additionally, individuals whose membership became effective after January 1, 1979, and whose annual rate of regular compensation is at or above thirty thousand dollars ($30,000.00), must also contribute an additional two percent (2%) on regular compensation earnings in excess of thirty thousand dollars. The calculation of the additional 2% withholding is determined by the frequency of payroll periods. The withholding of the additional 2% bears no relationship to the amount of regular compensation earned in a calendar year. Essentially, we do not wait for a member to earn $30,000.00 before taking the 2% contribution. Instead, the 2% contribution is taken based on the rate of regular compensation at any given pay period. For example, paraprofessionals who are paid over a 22-pay period year and whose biweekly earnings exceed $1,363.64 will have an additional 2% deduction taken on retirement-eligible earnings at or above that amount. Employees paid over a 26-pay period year will have an extra 2% deduction taken on biweekly earnings at or above $1,153.85. Please note that you will see two deductions on your pay stub: one for the standard retirement contribution (e.g., 9%) and the second for the 2% contribution on earnings exceeding the prorated biweekly rates previously referenced.

As stated in the statute, employers are responsible for deducting the mandated pension contributions from their employees’ regular compensation via their payrolls and forwarding those contributions to their public retirement system for deposit in the members' annuity savings accounts. Your payroll deductions for retirement will fund an annuity, payable for life upon your retirement. In addition, you will earn a pension payable to you by the Fitchburg Retirement System. Your eventual benefits will be based on three factors: your age, your cumulative years of creditable service, and an average of your three highest consecutive 36 months of salary (for members who began their public service before April 2, 2012) or your five highest consecutive 60 months of salary (for members whose service began on or after April 2, 2012). Using this formula, we will determine the percentage of your retirement benefit, with the maximum being 80% of your respective three- or five-year average salary. You will be considered vested in the retirement system and eligible for benefits after 10 years of creditable service.

The pension contribution rate on regular compensation for individuals whose membership began on or after July 1, 1996, is nine percent (9%). Additionally, individuals whose membership became effective after January 1, 1979, whose annual rate of regular compensation is at or above thirty thousand dollars ($30,000.00), must also contribute an additional two percent (2%) on regular compensation earnings in excess of thirty thousand dollars. The calculation of the additional 2% withholding is determined by the frequency of payroll periods. The withholding of the additional 2% bears no relationship to the amount of regular compensation that is earned in a calendar year. In essence, we do not wait for a member to earn $30,000.00 before taking the 2% contribution. Instead, the 2% contribution is taken based on the rate of regular compensation at any given pay period. For example, paraprofessionals who are paid over a 22-pay period year, whose biweekly earnings are more than $1,363.64, will have an additional 2% deduction taken on retirement-eligible earnings at or above $1,363.64. Employees who are paid over a 26-pay period year will have an additional 2% deduction taken on biweekly earnings at or above $1,153.85. Please note, you will see two deductions on your paystub, one for the standard retirement contribution (e.g., 9%) and the second for the 2% contribution for earnings in excess of the prorated biweekly rate(s) previously referenced.

As stated in the statute, employers are responsible for deducting the mandated pension contributions from their employees’ regular compensation via their payrolls and forwarding those contributions to their public retirement system for deposit in the members' annuity savings accounts. Your payroll deductions for retirement will fund an annuity, payable for life upon your retirement. In addition, you will earn a pension payable to you by the Fitchburg Retirement System. Your eventual benefits will be based on three factors, your age, your cumulative years of creditable service, and an average of your three highest consecutive 36 months of salary (for members who began their public service before April 2, 2012) or, your five highest consecutive 60 months of salary (for member whose service began on or after April 2, 2012). Using this formula we will determine the percentage of your retirement benefit, the maximum being 80% of your respective three- or five-year average salary. You will be considered vested in the retirement system and eligible for benefits after 10 years of creditable service.