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December 27, 2011

Acts 10 and 32 Category Change Explanation

Acts 10 and 32 Mass Employement Category Change pre-list and reporting is now available. Employers should submit the changes as soon as possible. The changes are required to ensure that employees’ annual Statements of Benefits are accurate and complete.

The mass employment category change must be completed and verified by ETF staff prior to submitting the 2011 annual report. ETF staff will contact all employers to confirm that the employee category change process was successfully completed.

Employer Bulletin, Vol. 28, No. 15 contains more information. The information below and on the Employer Training page may also be of value when completing the employee category change process.

In addition, ETF staff will be available to assist employers with reporting and reconciliation situations that may be encountered in the coming weeks. Please do not hesitate to contact the Employer Communication Center with questions toll free at (888) 681-3952 or locally at (608) 264-7900.

Why did ETF decide to create new employment categories?

2011 Wisconsin Acts 10 and 32 created multiple challenges in the administration of retirement benefits for public employees. The most efficient and effective way to overcome these challenges was to implement category changes for all employees in the WRS (Wisconsin Retirement System). The main components that led to this decision were:

  1. The change in contribution rates;
  2. The mid-year implementation of these changes; and
  3. WRS system capabilities and employer reporting procedures.

The change in contribution rates meant that in 2011 employee contributions for most categories will be allocated at two different rates. For example: the contribution rate for a general category employee pre-Acts 10 and 32 was 5.0%; the post-Acts 10 and 32 contribution rate is now 5.8%.

Because Acts 10 and 32 were implemented mid-year, ETF needed a way to separate pre-Acts 10 and 32 contribution rates from post-Acts 10 and 32 contribution rates. The new employee categories will determine the contribution percentage that is allocated to each account.

The WRS systems were not set up to handle multiple contribution rates, multiple employee categories or to store pre-tax contributions. In addition, the pre-Acts 10 and 32 employer reporting procedures did not allow for mid-year hours and earnings reporting. This meant that ETF had no way to know which part of an individual employee’s hours and earnings were pre- and post-Acts 10 and 32.

How will the employment category change initiative help?

ETF used this opportunity to overcome these challenges and to enhance our systems in other areas, providing employers with better service now and in the future. Some of these enhancements are as follows:

  • Ability to convert old employment categories with three contribution buckets to new employee categories with two contribution buckets (BAC was eliminated in these changes).
  • Separate and populate pre- and post-tax dollars;
  • Allocate correct contribution percentages for all employees;
  • Implement an automated reporting system which will provide greatly enhanced service to the employers of the WRS; and
  • Ensure ETF the ability to accurately credit all employee accounts.

It is critical that all employers embrace this change and work with ETF to make this a smooth transition.

What do we need from you?

The first step is to report hours and earnings accumulated on the last date of the payroll for which pre-Acts 10 and 32 rates apply. This is the payroll prior to the first full pay period on or after June, 29, 2011.

How will ETF help you complete this requirement?

ETF will continue to offer training sessions on how to report this information.


Step-by-Step Instructions

Employer Bulletin, Vol. 28, No. 15

WRS Employment Categories

Employment Category Changes FAQs


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