ATTACHMENT - IAFF Medical Expense Reimbursement Plan Terms I. MEDICAL INSURANCE - UNIT EMPLOYEES WHO RETIRE FROM THE CITY OF GLENDALE OR TERMINATE EMPLOYMENT AFTER TWENTY (20) YEARS OR MORE OF SERVICE IN A FIRE SWORN SAFETY POSITION.
A. Retiree Health Savings Plan (RHSP)
1.Purpose
a. The Retiree Health Savings Plan (RHSP) enables unit employees who retire from the City of Glendale or terminate employment after twenty (20) years or more of service in a Fire sworn safety position to have the opportunity to convert unused accumulated sick leave hours to pre-tax monies to be used for the retirees’ medical and/or dental insurance costs during their retirement. b. Retiring unit employees may also participate in the PERS Sick Leave Credit program for unused sick leave, as set forth in Govt. Code 20965. Said retiring employees who choose the option of converting unused sick leave to service credit may not receive double credit for the same allotment of unused sick leave hours at retirement.
For Example:
If a unit employee has 2,000 hours upon retirement, he or she may choose any one of these three options:
1. Convert 2,000 hours to the RHSP program;
2. Convert 2,000 hours to the PERS Sick Leave Credit program; or
3. A combination of the above two options with the
understanding that hours may only be used once.
2. Limitations
a. Unit employees who terminate employment after twenty (20) years or more of service in a Fire sworn safety position:
1. Shall be eligible to participate in the RHSP plan benefits or Retiree Medical Trust subject to procedures that comply with IRS regulations as set forth in Section V-A (3) below. b. Unit employees who retire from the City of Glendale in a Fire sworn safety position:
1. Shall be eligible to participate in the RHSP plan benefits or Retiree Medical Trust subject to procedures that comply with IRS regulations as set forth in Section V-A (3) below; or
2. Participate in the PERS Sick Leave Credit program for unused sick leave as set forth in Govt. Code 20965; or
3. A combination of the above two options with the
understanding that hours may only be used once.
c. Unit employees who retire from the City of Glendale, or terminate employment after twenty (20) years or more of service, in a Fire sworn safety position must have their unused accumulated vacation leave paid at the current hourly base rate of pay to the employee’s Retiree Medical Trust account (or RHSP if specifically elected by the employee) upon retirement or separation subject to procedures that comply with IRS regulations.
d. During employment, unit employees must transfer unused accumulated compensatory time over 72 hours at the current regular rate of pay to the employee’s RHSP account, subject to procedures that comply with IRS regulations. See Article Three, Section X(D)(1) for Pay Out Upon Termination.
e. The employee is responsible for paying any post retirement RHSP service fees and holds the City harmless for any taxes incurred from their utilization of the RHSP.
3. Sick Leave Hourly Conversion Rate
a. Unit employees who retire from the City of Glendale, or terminate employment after twenty (20) years or more of service, in a Fire sworn safety position shall have each eligible hour of accrued unused sick leave converted at the rate of thirty dollars ($30.00) per hour, which will be paid to the employee’s individual Retiree Medical Trust (or Retiree Health Savings Plan (RHSP) if specifically elected by the employee) effective upon the employee’s official date of retirement or separation.
B. RHSP City Contributions
The City shall contribute seventy-five dollars ($75.00) per month to each unit employee’s RHSP account.
Upon implementation of the Retiree Medical Trust set forth in Section C, below, the City shall instead contribute seventy-five dollars ($75.00) per month to each unit employee’s Retiree Medical Trust account.
C. Retiree Medical Trust
1. City Acknowledgment. The City acknowledges that, pursuant to a majority vote of the Association membership, the Association has entered into an agreement with the IAFF Medical Expense Reimbursement Plan of the Washington State Council of Fire Fighters Employee Benefit Trust (hereafter, the “Trust”). The Trust, which qualifies as a “voluntary employees’ beneficiary association” within the meaning of Internal Revenue Code Section 501(c)(9). The Trust will provide for the reimbursement of post-retirement medical expenses incurred by City retirees who were covered by this Agreement.
2. Association Acknowledgment. The Association acknowledges that:
a. The City is not a party to the Trust.
b. The City is not subject to the terms of the Trust or any employee welfare benefit plan or other arrangement funded by the Trust, and has no responsibility or authority whatsoever for providing or overseeing any benefits offered under any such plan or
arrangement.
c. The preceding City acknowledgements will continue to apply on and after the City’s adoption of this agreement.
d. The City’s sole obligation under this Article V, Section C of the agreement is to make contributions to the Trust in accordance with the terms specified below. No person will have any vested right to continue receiving such contributions after the expiration of this agreement.
3. Defined Class of Employees Receiving Contributions. Employees receiving contributions to the Trust consist of all employees of the City represented by the Association (“Defined Class”).
4. Employee Contribution Amount. The City and the Association agree that the City shall withhold a mandatory contribution tiered in the following structure based on paid full-time sworn employment in the fire service:
0-10 years $150/month over twenty-six pay periods per year 11-20 years $250/month over twenty-six pay periods per year 21+ years $350/month over twenty-six pay periods per year Employee contributions shall be on a pre-tax basis from the pay of every employee of the Defined Class and the City shall transmit such contributions to the Trust pursuant to the requirements of section 7 below. No Employee shall be permitted to opt-out of the mandatory contributions or receive any portion of the contribution in cash. Unit employees shall be responsible for notifying Fire Administration of their eligibility to receive a particular contribution based on their years of service.
5. Employer Contribution Amount. For every employee in the Defined Class, the City shall contribute seventy-five dollars ($75.00) per month to the Trust on a pre-tax basis. No Employee will be permitted to opt-out of the mandatory employer contribution or receive any portion of the contributions in cash or other form.
6. Contribution of Employee Leave. The City and the Association agree that the City will make the following mandatory transfers, on a pre-tax basis, to the Trust (or RHSP if specifically elected by the employee; See, Section A, above) on behalf of every employee of the Defined Class:
a. Mandatory Accrued Vacation Leave Contribution at Separation.
The City shall, upon the Employee’s retirement or separation from the City with at least twenty (20) years of service, irrevocably contribute to the employee’s Trust (or RHSP) account on a pre-tax basis, an amount equal in value to 100% of the contribution for unused vacation leave as set forth in Article Five, Section II(F) of this MOU, and subject to all of the requirements and limitations of Article Five, Section II(F), i.e., at least one year of service with the City prior to termination.
b. Mandatory Accrued Sick Leave Contribution at Separation. The City shall, upon the employee’s retirement or separation from the City with at least twenty (20) years of service, irrevocably contribute to the employee’s Trust (or RHSP) account on a pre-tax basis, an amount equal in value to 100% of the contribution for unused sick leave as set forth in Article Four, Section V(A) of this MOU, and subject to all of the requirements and limitations of Article Four, Section V(A).
c. If the employee is eligible to contribute to the employee’s Trust, the employee shall not have the option to receive a cash payout for the value of the accrued vacation or sick leave in lieu of making contributions to the Trust.
7. Remittance of Contributions. The City shall remit all contributions to the Trust in one aggregate payment, either per pay period or per calendar month at the City’s discretion. The contributions will be transmitted, via EFT payment, directly to the custodian of the Trust within 30 days after the last day of the calendar month that the contributions relate to.
The City hereby acknowledges receipt of the Trust Agreement governing the Trust and will follow the Trust Office’s guidelines for reporting and depositing the required contributions set forth herein.
8. Reporting to the Trust Office. The City shall electronically submit to the Trust Office a report of contributing employees for each contribution sent to the Trust, in the format requested by the Trust, and received by the Trust Office within five (5) days of receipt of the contribution funds.
The City shall also provide an initial report of identifying information (i.e., name, address, date of hire, DOB, SSN, etc.) for all contributing employees, as reasonably requested by the Trust; and shall send updates to this information to the Trust Office whenever the City has notice of changes to the information.
9. Modification of Employee Contribution. The City and the Association agree that the Association has the right, subject to approval of its members according to the Association’s internal rules, to prospectively modify the amount of the mandatory employee monthly contribution in any increment of $25.00, no more than one time during the course of this Agreement, so long as the modification is mandatory for all employees of the Defined Class.
10. Limitations. The City is not a party to the Trust and shall not incur or be liable for any fees associated with the Trust. The City will only administer and report contributions toward a qualifying employee benefit plan under the Internal Revenue Code. The City may cease payroll deductions toward the Trust if the City incurs a fee, anticipates incurring a fee, or believes the payroll deductions will expose the City to legal claims or liabilities; provided however, that the City shall provide advance notice to the Association of its intent to cease contributions and allow the Association a reasonable opportunity to discuss or absorb any costs to the City. Responsibility for the maintenance and investment of the Trust funds rests solely with the Trust’s Board of Trustees.