New Legislation Would Address Retiring Teacher’s Sick Leave Bank “Gap”

While many teachers retire directly from their normal full time teaching position, many others choose to reduce their duties to a half time or classified position for a year or two before throwing in the towel completely.

Unfortunately, this choice has caused more than a few tears when these individuals go to retire. That’s because a teacher’s accrued unused sick leave distribution is calculated using a formula dependent on the salary at the year of retirement.

For a teacher who chooses to ease out into retirement by going half time or trade teaching for a classified position, the distribution at retirement could be substantially less when calculated using the salary at the time of retirement.

Senator Janae Ward-Engelking (D-Boise)

The proposal, sponsored by Janae Ward-Engelking, would eliminate this heartburn that is a retirement surprise of the worst kind by substituting the language of “the year of retirement” for “highest year of salary.”

This change would ensure that sick leave accrued during decades of teaching will not suddenly lose over half its value if a teacher chooses to ease out slowly instead of all at once.

Unused sick days can become very valuable at retirement because they can be cashed out at half their normal value upon retirement to be used to continue paying health, dental, vision, and life insurance premiums.

For many, unused sick leave establishes a “bridge” between retirement age and Medicare/Social Security age by paying for interim health insurance premiums.

Obviously, an educator who chooses to go part time might not realize how that decision would impact their retirement, particularly if they have accumulated a substantial cache of sick leave over the duration of their career unless this change is made.

As the fiscal note states, the cost of this change would be relatively low considering that teachers had banked these days under their higher salaries while teaching full time and paying into the system at a higher rate.

One thought on “New Legislation Would Address Retiring Teacher’s Sick Leave Bank “Gap”

  1. Mary Ollie

    Sick leave benefits are property that is earned. Property rights apply. What I’d like to see is the ability to convert sick leave to cash or to roll over into a HSA to purchase insurance. As it is, if you want to use your sick days after retirement, you are married to the district plan. South Dakota allows the cash out…..wouldn’t this be something for Idaho to discuss? I think it would give retirees options AND lessen the paperwork for districts who have to work with retired teachers on insurance.

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