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Madison Metropolitan School District

Employee Handbook 2021-2022

Addendum A: SECTION 11 POST-EMPLOYMENT BENEFITS

11.1 Teacher Emeritus Retirement Program (TERP)

Guidelines for Operation

  1. The program shall be completely voluntary.

  2. The Eligibility Factor for a teacher to participate shall be the participant’s age and total service to the Madison Metropolitan School District, including annexed districts, totaling at least seventy-five (75) or total service to the District of at least thirty (30) years.

  3. Teachers must be at least 55 years of age by August 30 or total service to the District at least thirty (30) years prior to participation in the program in order to be eligible. Up to ten teachers may retire per year under part-time contracts, if these teachers are otherwise eligible and have worked full-time within the last ten years. The purpose of this latter provision is to allow teachers to participate in “phased retirement” without losing their benefits herein.

  4. Participants must enroll, by signing an agreement form provided by the District, by February 15 of the year he/she wishes to begin participation in the program, with termination of their current individual teacher contract effective at the end of the then current school year in which they wish to begin participation in the program. Insurances will be paid on the basis provided herein through August 31. Thereafter insurances shall be paid, at the option of the teacher, from their accumulated personal illness leave, so long as such has a balance.

  5. Said program is subject to all applicable laws or judicial findings.

  6. In the event of the death of a participant, the benefits under this program shall cease at the end of the pay period in which death occurs.

Operational Criteria

  1. Compensation, under the program shall be considered a retirement benefit and shall be paid monthly, by the District, to the participating teacher. Payment shall be made only for the duration of the teacher’s participation in the program and shall cease upon the employee’s death or exhaustion of funds.

  2. Compensation shall be calculated as specified below:

    1. Retirement Remuneration Benefit Duration

      1. The District shall pay all eligible retirees the sum of nineteen percent (19%) of the eligible retiree’s highest annual salary per year. The District shall pay all eligible employees the amount set forth above for three (3) years.

      2. PaymentofcompensationsetoutinthissectionshallcommenceOctober1.Payments shall be made in equal monthly installments over the course of the election year.

    2. Accrued Personal Illness Leave – Accrued personal illness leave shall be used to continue insurance premium payments by the District as set forth herein.

    3. Section 125 Plan for Payments: The District will create or amend its section 125 plan to require teachers participating under TERP to participate in the District’s section 125 plan. Before July 1st following retirement, and annually thereafter, (until exhaustion of the retiree’s TERP benefit), each eligible retired employee shall elect, under the section 125 plan, between cash (as outlined above in Section 2-A-2) and/or eligible flexible spending account benefits. The retiree shall be responsible for any applicable employee taxes that arise under the implementation of this benefit.

  1. Such funds as noted above shall then be distributed, in whole or in part, at the option of the participant, directly to the participant or through direct deposit.

  2. Participants in the Teacher Emeritus Retirement Program shall be eligible for participation in the Group Hospital and Surgical Insurance Program, Life and Dental Insurance Programs as set forth in this Handbook. Teachers and their spouse, regardless of whether both are employees, may elect separate single plans under the above with the premium for both individuals paid from the above-noted funds.

  3. The individual may elect to substitute in the District. Such service shall have no effect on the individual’s participation in this program.