Employer Bulletin

All WRS Employers
Vol. 22, No. 18
November 18, 2005

Reminder on Non-Reportable Earnings for Wisconsin Retirement System Purposes

The Department of Employee Trust Funds (ETF) discovered during a review of Employer Statements (ET-5607) used for disability benefits that some employers may be incorrectly reporting Wisconsin Retirement System (WRS) earnings. The following information will assist you in determining whether disability-related payments are considered earnings reported for WRS purposes.

Non-Reportable Earnings: Disability Insurance Plan Payments Made in Lieu of Sick Leave

Disability insurance benefit payments, made to participants from an insurance program, are not earnings for WRS purposes and must not be reported to ETF as such. Some employers have incorrectly considered these insurance benefit payments to be WRS earnings. Subchapter 406 C of the WRS Administration Manual provides examples of earnings not reportable for WRS.

Payments made in lieu of sick leave that have been incorrectly reported as WRS earnings must be removed from the employee’s WRS earnings; the employee's WRS earnings history must be corrected. See the WRS Administration Manual, Chapter 8, to make current year earnings adjustments and/or Chapter 10 for prior year adjustments.

Reportable Earnings: Periods of Temporary Worker’s Compensation

Employers are required to report hours and earnings for any employee receiving temporary Worker’s Compensation benefits under Wis. Stat. § 102.43, regardless if the disability is partial or total. The hours and earnings must be reported at the same pay rate the employee would have received had the employee remained working. In the event an employee receiving temporary Worker’s Compensation would have received a pay adjustment had the employee remained working, the adjusted pay rate is also reportable for WRS purposes. Subchapter 404 of the WRS Administration Manual, in addition to Wis. Stat. § 40.29, provides information on reporting Temporary Worker’s Compensation .

In addition to reporting the hours and earnings during a period an employee is receiving temporary Worker’s Compensation payments, the employer must pay all employee and employer required contributions on those earnings reported on behalf of the employee. The reporting of the service and earnings stops once the temporary disability payments cease or the employee terminates employment.

Periods of temporary Worker’s Compensation where service and earnings were not reported, or were reported incorrectly, must be corrected. See WRS Administration Manual, Chapter 8, to make current year earnings adjustments and/or chapter 10 for prior year adjustments.

If you have questions or need assistance to properly report these earnings or correct previously reported amounts, please contact the Employer Communication Center at 608-264-7900.