Some UAPD members who are subject to the Public Employees’ Pension Reform Act (PEPRA) notified the Union that the CalPERS employee contributions that are being deducted from their paychecks are too high. It is quite likely that this problem affects more than the handful of doctors who noticed it on their paychecks. UAPD has been investigating the problem and taking the first steps to resolve it.
Who is Involved?
Doctors who joined CalPERS for the first time after January 1, 2013 (and were not eligible for reciprocity with another California public employer) are subject to changes made by PEPRA. For just these employees, pensionable salaries are capped at $117,020 (for those participating in Social Security) or $140,424 (for those not covered by Social Security). Employees who fall under PEPRA may be paying too much in CalPERS contributions.
What is the Problem?
PEPRA, which is California Code 7522.10 (h), says that both the employee and employer contribution to CalPERS should be calculated as a percentage of the pensionable salary amount (either $117,000 or $140,424) not the full salary amount. In other words, when the employee’s salary goes above the pensionable level, CalPERS contributions should be stopped for the remainder of the year. Right now, at least some UAPD doctors are making an employee contribution to CalPERS for a portion of their salary that is not pensionable because it exceeds the capped amount. This should not be happening.
Next Steps
UAPD has already begun the process of correcting the problem. We contacted CalHR, the Controller’s Office, and CalPERS to ensure that the error is fixed and members are reimbursed for the extra payments they have made. UAPD requested a list of all BU 16 doctors who are subject to the PEPRA salary caps, so that we can force the State to correct the problem for everyone. You do not need to contact UAPD individually to report that you are being overcharged. We will assume that all doctors covered by PEPRA are being overcharged, and notify everyone when this problem is resolved.