Department of Employee Trust Funds
November 19, 2013
Employer and Employee Contributions
for most Wisconsin Retirement System (WRS) employers and employees
will increase in 2014. The following rate increases were recommended
by the WRS consulting actuary and approved by the Employee Trust
- 0.7% of payroll for general category employees (including teachers)
- 1.5% of payroll for executive/elected official/judge category
- 0.7% of payroll for protective category employees covered by
- 1.7% of payroll for protective category employees not covered
by Social Security
The total contribution rates are shown in the table below. In general,
the total rate is split equally between the employee and the employer.
This means general category employees will contribute .35% more
of their salaries in 2014.
Why are contribution rates increasing?
While many complex factors affect WRS contribution rates, the increase
is primarily due to the lingering effects of 2008’s global
economic meltdown. 2014 is the last year that the investment declines
will affect WRS contribution rates. Contribution rate changes, whether
increases or decreases, are considered normal for retirement systems
that have defined, or pre-funded, benefits.
Core Trust Fund investment results are distributed (“smoothed”)
over five years to soften the impact of year-to-year volatility
of investments. This also helps to keep WRS contribution rates stable.
For example, over the past 25 years the rate for General category
employees has deviated by just 2%.
The new rates (shown below) go into effect January 1, 2014. Rates
may be different for employees who have collective bargaining agreements.
Other mandatory employer contributions for duty disability, the
state's Accumulated Sick Leave Conversion Credit Program, or unfunded
liabilities are not included and vary by employer.
| Employee Category
| Elected Official/
| Protective with Social Security
| Protective without Social Security
For additional information:
WRS Contribution Rates Determined?
(WRS News, January 2012)
Online Video: Employee
Contributions and WRS Investments