{"data":{"id":"us-ky/krs-161.605","jurisdiction":"us-ky","citation":"KRS 161.605","heading":"Resumption of employment by retired member -- Continuation of","body":"retirement allowance -- Individuals who retire and are reemployed -- Part-\ntime, substitute teaching, and nonteaching employment -- Health insurance\ncoverage.\nAny member retired by reason of service may return to work in a position covered by the\nKentucky Teachers' Retirement System and continue to receive his or her retirement\nallowance under the following conditions:\n(1) Any member who is retired with thirty (30) or more ye ars of service may return to\nwork in a full -time or a part -time position, or in a position providing substitute\nteaching service, covered by the Teachers' Retirement System and earn up to a\nmaximum of seventy-five percent (75%) of the member's last annual compensation\nmeasured on a daily rate to be determined by the board of trustees. For purposes of\ndetermining whether the salary of a member returning to work is seventy -five\npercent (75%) or less of the member's last annual compensation, all remuneration\npaid and benefits provided to the member, on an actual dollar or fair market value\nbasis as determined by the retirement system, excluding employer-provided medical\ninsurance required under subsection (4) of this section, shall be considered.\nMembers who were retired on or before June 30, 2002, shall be entitled to return to\nwork under the provisions of this section as if they had retired with thirty (30) years\nof service. Nonqualified service credit purchased under the provisions of KRS\n161.5465 or elsewher e with any state -administered retirement system shall not be\nused to meet the thirty (30) year requirement set forth in this subsection. Out -of\nstate teaching service provided in public schools for kindergarten through grade\ntwelve (12) may count toward th e thirty (30) year requirement set forth in this\nsubsection even if it is not purchased as service credit, if the member obtains from\nhis or her out -of-state employer certification of this service on forms prescribed by\nthe retirement system;\n(2) Any member who is retired with less than thirty (30) years of service after June 30,\n2002, may return to work in a full -time or part -time position, or in a position\nproviding substitute teaching service, covered by the Teachers' Retirement System\nand earn up to a m aximum of sixty-five percent (65%) of the member's last annual\ncompensation measured on a daily rate to be determined by the board of trustees.\nFor purposes of determining whether the salary of a member returning to work is\nsixty-five percent (65%) or less  of the member's last annual compensation, all\nremuneration paid and benefits provided to the member, on an actual dollar or fair\nmarket value basis as determined by the retirement system, excluding employer -\nprovided medical insurance required under subsec tion (4) of this section, shall be\nconsidered;\n(3) Under this section, an employer may employ full-time a number of retired members\nnot to exceed ten percent (10%) of the membership actively employed full -time by\nthat employer. The board of trustees may re duce this ten percent (10%) cap upon\nrecommendation of the retirement system's actuary if a reduction is necessary to\nmaintain the actuarial soundness of the retirement system. The board of trustees\nmay increase the ten percent (10%) cap upon a determinati on that an increase is\nwarranted to help address a shortage in the number of available teachers and upon\nthe determination of the retirement system's actuary that the proposed cap increase\nallows the actuarial soundness of the retirement system to be maint ained. For\npurposes of this subsection, \"full -time\" means the same as defined by KRS\n161.220(21). A local school district may exceed the quota established by this\nsubsection by making an annual written request to the Kentucky Department of\nEducation which the department may approve on a year-by-year basis;\n(4) (a) Except as provided by subsection (9) of this section, a retired member\nreturning to work in a full -time or part -time position, or in a position\nproviding substitute teaching service under subsecti on (1) or (2) of this\nsection, shall contribute to an account with the retirement system that shall be\nadministered independently from and with no reciprocal impact with the\nmember's original retirement account, or any other account from which the\nmember is eligible to draw a retirement allowance.\n(b) Except as provided by subsection (9) of this section, a retired member\nreturning to work under subsection (1) or (2) of this section shall make\ncontributions to the retirement system at the rate provided under  KRS\n161.540. The new account shall independently meet all vesting requirements\nas well as all other conditions set forth in KRS 161.600(1) or (2), as\napplicable, before any retirement allowance is payable from this account. The\nretirement allowance accrui ng under this new account shall be calculated\npursuant to KRS 161.620. This new account shall not entitle the member to a\nduplication of the benefits offered under KRS 161.620(7) or 161.675, nor\nshall this new account provide the benefits offered by KRS 16 1.520, 161.525,\n161.620(3), 161.655, 161.661, or 161.663.\n(c) A retired member returning to work for an employer that participates in a\nstate-administered retirement system shall waive his or her medical insurance\nwith the Teachers' Retirement System durin g the period of reemployment and\nshall receive the medical insurance coverage that is offered by the member's\nactive employer. If medical insurance coverage is not available from the\nemployer, the Kentucky Teachers' Retirement System may provide coverage\nfor the member.\n(d) A retired member returning to work under subsection (1) or (2) of this section\nshall not be eligible to purchase service credit for any service provided after\nthe member's effective date of retirement but prior to the date that the membe r\nreturns to work. A member returning to work under subsection (1) or (2) of\nthis section shall not be eligible to purchase service credit that the member\nwould have otherwise been eligible to purchase prior to the member's initial\nretirement.\n(e) A retired member who returns to work under subsection (1) or (2) of this\nsection, or in the event of the death of the member, the member's estate or\napplicably designated beneficiary, shall be entitled, within ninety (90) days of\nthe posting of the annual report submitted by the employer, to a refund of\ncontributions as permitted and limited by KRS 161.470;\n(5) The board of trustees may annually, on July 1, adjust the current daily rate of a\nmember's last annual compensation, for each full twelve (12) month  period that has\nelapsed subsequent to the member earning his or her last annual compensation, by\nthe percentage increase in the annual average of the consumer price index for all\nurban consumers for the calendar year preceding the adjustment as published by the\nFederal Bureau of Labor Statistics, not to exceed five percent (5%) annually. Each\nannual adjustment shall become part of the member's daily rate base. Failure to\ncomply with the salary limitations set forth in subsections (1) and (2) of this sectio n\nas may be adjusted by this subsection shall result in a reduction of the member's\nretirement allowance or any other benefit to which the member would otherwise be\nentitled on a dollar -for-dollar basis for each dollar that the member exceeds these\nsalary limitations, and the member shall be refunded his or her retirement\ncontributions made on the compensation that exceeds these salary limitations.\nNotwithstanding any other provision of law to the contrary, a member retiring from\na local school district who  returns to work for a local school district under\nsubsection (1) or (2) of this section shall be entitled, without any reduction to his or\nher retirement allowance or any other retirement benefit, to earn a minimum\namount equal to two hundred dollars ($200) per day;\n(6) (a) A retired member returning to work under subsection (1) or (2) of this section\nshall have separated from service for a period of at least one (1) year if\nreturning to work for the same employer on a full-time basis, and at least three\n(3) months if returning to work for a different employer on a full -time basis.\nA retired member returning to work under subsection (1) or (2) of this section\non a part -time basis shall have separated from service for a period of at least\nthree (3) months before returning to work for any employer.\n(b) A retired member who is returning to work for an employer that has\nemployees who participate in the Teachers' Retirement System shall comply\nwith the separation -from-service requirements in this subsection befor e\nperforming any service for the employer, regardless of whether the retired\nmember is providing service in a position covered by the Teachers'\nRetirement System.\n(c) The starting date for any separation from service required under this\nsubsection shall be the effective date of the member's retirement.\n(d) The separation -from-service requirements of this subsection are not met if\nthere is a prearranged agreement between the member and an employer that\nhas employees who participate in the Teachers' Retiremen t System prior to\nretirement for the member to work for the employer after retirement.\n(e) The Teachers' Retirement System may require the member and the employer\nfor which the member is returning to work to certify in writing on a form\nprescribed by the Teachers' Retirement System that no prearranged agreement\nwas or will be entered into between the member and employer prior to\nretirement for the member to work for the employer after retirement.\n(f) Failure to comply with the separation -from-service requir ements in this\nsubsection voids a member's retirement and the member shall be required to\nreturn all the retirement benefits he or she received, with interest, for the\nperiod of time that the member returned to work without a sufficient\nseparation from service;\n(7) (a) Effective July 1, 2004, local school districts may employ retired members in\nfull-time or part -time teaching or administrative positions in critical shortage\nareas without limitation on the compensation of the retired members that is\notherwise required by subsections (1) and (2) of this section. The number of\nretired members that a local school district may employ under this subsection\nshall be no more than four (4) members per local school district or ten percent\n(10%) of the total active mem bers employed by the local school district on a\nfull-time basis as defined under KRS 161.220(21), whichever number is\ngreater. Retired members returning to work under this subsection shall be\nsubject to the separation-from-service requirements set forth in  subsection (6)\nof this section. Retired members returning to work under this subsection shall\nwaive their medical insurance coverage with the retirement system during\ntheir period of reemployment and receive medical insurance coverage that is\noffered by the member's active employer. Retired members returning to work\nunder this subsection shall contribute to an account subject to the conditions\nset forth in subsection (4) of this section. Retired members returning to work\nunder this subsection shall make co ntributions to the retirement system at the\nrate provided under KRS 161.540. The employer shall make contributions at\nthe rate provided under KRS 161.550. Local school districts shall make\nannual payments to the retirement system on the compensation paid t o the\nreemployed retirees at the rates determined by the retirement system's actuary\nthat reflect any accrued liability resulting from the reemployment of these\nmembers.\n(b) The Department of Education may employ retired members in full -time or\npart-time t eaching or nonteaching positions without the limitations on\ncompensation otherwise required by subsections (1) and (2) of this section to\nfill critical shortage areas in the schools it operates, including the Kentucky\nSchool for the Blind and the Kentucky School for the Deaf, and to serve on\naudit teams. The department shall be subject to the same requirements as local\nschool districts as provided in paragraph (a) of this subsection, except the\nTeachers' Retirement System shall determine the maximum number of\nemployees that may be employed under this paragraph;\n(8) The return -to-work limitations set forth in this section shall apply to retired\nmembers who are returning to work in the same position from which they retired, or\na position substantially similar to the one from which they retired, or a position\ndescribed in KRS 161.046 or any position listed in KRS 161.220(4) which requires\nmembership in the retirement system. Positions which generally require\ncertification or graduation from a four (4) year colle ge or university as a condition\nof employment which are created, or changed to remove the position from coverage\nunder KRS 161.220(4) are also subject to the return to work limitations set forth in\nthis section. The board of trustees shall determine whethe r employment in a\nnonteaching position is subject to this subsection;\n(9) (a) Notwithstanding the provisions of this section, individuals who become\nmembers on or after January 1, 2022, who subsequently retire and begin\ndrawing a monthly lifetime retiremen t allowance from the Teachers'\nRetirement System, who following retirement are reemployed with an\nemployer participating in the Teachers' Retirement System, shall not be\neligible to contribute to or earn benefits in a second retirement account in the\nTeachers' Retirement System during the period of reemployment.\n(b) The provisions of subsections (1) to (7) of this section are not subject to KRS\n161.714;\n(10) Retired members may be employed in a part -time teaching capacity by an agency\ndescribed in KRS 161.2 20(4)(b) or (n), not to exceed the equivalent of twelve (12)\nteaching hours in any one (1) fiscal year. Retired members may be employed for a\nperiod not to exceed the equivalent of one hundred (100) days in any one (1) fiscal\nyear in a part -time administrative or nonteaching capacity by an agency described\nin KRS 161.220(4)(b) or (n) in a position that would otherwise be covered by the\nretirement system. Except as otherwise provided by this subsection, the return to\nwork provisions set forth in subsections (1) to (7) of this section shall not apply to\nretired members who return to work solely for an agency described in KRS\n161.220(4)(b) or (n). Calculation of the number of days and teaching hours for part -\ntime teaching, substitute teaching, or part -time empl oyment in a nonteaching\ncapacity under this section shall not exceed the ratio between a school year and the\nactual months of retirement for the member during that school year. The board of\ntrustees by administrative regulation may establish fractional equ ivalents of a day\nof teaching service. Any member who exceeds the twelve (12) hour or one hundred\n(100) day limitations of this subsection shall be subject to having his or her\nretirement voided and be required to return all retirement allowances and other\nbenefits paid to the member or on the member's behalf since the effective date of\nretirement. In lieu of voiding a member's retirement, the system may reduce the\nmember's retirement allowance or any other benefit to which the member would\notherwise be ent itled on a dollar -for-dollar basis for each dollar of compensation\nthat the member earns in employment exceeding twelve (12) hours, one hundred\n(100) days, or any apportionment of the two (2) combined. Retired members\nreturning to work for an employer desc ribed in KRS 161.220(4)(b) or (n) shall\ncomply with the separation -from-service requirements of subsection (6) of this\nsection;\n(11) When a retired member returns to employment in a part -time teaching capacity or\nin a nonteaching capacity as provided in su bsection (10) of this section, the\nemployer shall contribute annually to the retirement system on the compensation\npaid to the retired member at rates determined by the retirement system actuary that\nreflect accrued liability for retired members who return  to work under subsection\n(10) of this section; and\n(12) For retired members who return to work during any one (1) fiscal year in both a\nposition described in KRS 161.220(4)(b) or (n) and in a position described under\nanother provision under KRS 161.220(4) , and for retired members who return to\nwork in a position described under KRS 161.220(4)(b) or (n) in both a teaching and\nan administrative or nonteaching capacity, the board of trustees shall adopt a\nmethodology for a pro rata apportionment of days and h ours that the retired\nmember may work in each position.\n(13) Notwithstanding any other provision of KRS 161.220 to 161.716 to the contrary, an\nannuitant who has returned to work following retirement with an employer that\ndoes not participate in the state -administered retirement systems shall not be\nrequired to take health insurance coverage through the employer and the system\nshall continue to provide health insurance coverage and benefits to the annuitant\nduring the period of employment, except as may be r equired by the Medicare\nSecondary Payer Act under 42 U.S.C. sec. 1395y(b).\n(14) Any member retired by reason of service may waive his or her annuity and return to\nfull-time employment in a Teachers' Retirement System -covered position that is on\nthe certified salary schedule under the following conditions:\n(a) The member shall:\n1. Receive no annuity payments while employed in a full -time position\ndescribed in this subsection;\n2. Make contributions on the salaries received for the service in a full -time\nposition;\n3. If employed for at least one (1) consecutive contract year in a full -time\nposition, have his or her retirement annuity recalculated as provided in\nthe regular retirement formula in KRS 161.620(1), except that,\nregardless of salaries earned during w aiver, a monthly retirement\nallowance recalculated under this paragraph shall not be increased by\nmore than ten percent (10%) per full contract year of waiver worked or a\nprorated percentage for a year during waiver when less than a full\ncontract year was worked. The recalculated retirement allowance shall\nbe less any applicable actuarial discount applied to the original\nretirement allowance due to the election of a joint and last survivor\noption; and\n4. Waive his or her medical insurance coverage with the Teachers'\nRetirement System during the period of reemployment and instead shall\nreceive the medical insurance coverage that is generally offered by the\nmember's active employer;\n(b) 1. The member's estate or, if there is a beneficiary applicably designated\nby the member, then the beneficiary, shall continue to be eligible for life\ninsurance benefits as provided in KRS 161.655.\n2. Retirement option, plan account type, and beneficiary designation on\noriginal retirement shall not be altered by postretirement employment\nunder this subsection, and dependents and spouses of the members shall\nnot become eligible for benefits under KRS 161 .520, 161.525, or\n161.661 due to postretirement employment;\n(c) 1. When a member returns to a full -time position described in this\nsubsection and as provided in paragraph (a) of this subsection, the\nemployer is required to withhold and remit regular retire ment\ncontributions.\n2. The member shall be returned to the annuity rolls on July 1 following\ncompletion of the contract year or on the first day of the month\nfollowing the month of termination of service. A member shall not be\nreturned to the annuity rolls  until after he or she has filed a retirement\napplication in compliance with KRS 161.600(6). Any discounts applied\nat the time of the original retirement due to service or age may be\nreduced or eliminated in the recalculation subject to the ten percent\n(10%) cap in paragraph (a) of this subsection; and\n(d) A member retired by reason of service who has been employed the equivalent\nof twenty -five (25) days or more during a school year under KRS 161.605\nmay waive the member's retirement annuity and return to a  position described\nin this subsection during that school year a maximum of one (1) time during\nany five (5) year period, beginning with that school year.","path":["KRS Chapter 161"],"source_url":"https://apps.legislature.ky.gov/law/statutes/statute.aspx?id=57279","current_through":"Includes enactments through the 2026 Regular Session","vintage":"09/05/2026","retrieved_at":"2026-09-05T20:51:11Z","sha256":"9c96ba495029eba9e0865e4f948dbd825dd444856a53216dfaf43619b8ecff43","source_id":"us-ky","stale":false,"prev":"us-ky/krs-161.603","next":"us-ky/krs-161.607"},"notice":"GroundRules: Original legal text. Not legal advice."}