§ 24-7-502. Termination of active membership — Definitions

(a)

1. (1) A member of the Arkansas Teacher Retirement System shall terminate covered employment and remain terminated during the member’s applicable termination separation period to become and remain eligible for retirement.

2. (2)

   1. (A) Effective July 1, 2011, a member shall not be terminated from employment for purposes of retirement eligibility if within six (6) calendar months of the member’s effective date of retirement the member:

      1. (i) Meets both of the following requirements:

         1. (a) Becomes employed with an employer covered by the system; and

         2. (b) Has not attained the system’s normal retirement age; or

      2. (ii) Does not have a total or a combined total of thirty-eight (38) years or more of credited service in the system, Teacher Deferred Retirement Option Plan, or reciprocal service in another eligible state retirement system.

   2. (B) If a member has a combined total of thirty-eight (38) years or more of credited service in the system, Teacher Deferred Retirement Option Plan, or reciprocal credited service in another eligible state retirement system, then the member shall not be terminated from employment for purposes of retirement eligibility if within one (1) calendar month of the member’s effective date of retirement the member:

      1. (i) Becomes employed with an employer covered by the system; and

      2. (ii) Has not attained the system’s normal retirement age.

3. (3) A member who fails to meet both the termination requirement and the termination separation period requirement of this subsection shall:

   1. (A) Repay retirement benefits paid during the period the member did not meet the requirements; and

   2. (B) Forfeit all future retirement benefits until the member files a new completed retirement application using the standard system process.

4. (4) The system may require the repayment of retirement benefits, interest, and distributions from the member directly or indirectly by using the system’s standard withholding rule.

5. (5) If a member fails to meet the termination requirement or to complete the termination separation period, then the member is not eligible to receive retirement benefits until the member files a new completed retirement application using the standard system process. The member shall be subject to a new termination separation period.

6. (6) During the termination separation period, the member shall remain terminated and shall not:

   1. (A) Form an employment relationship with any system-covered employer;

   2. (B) Render any compensable services to or on behalf of any system-covered employer, except that a member may provide volunteer activities at a system-covered employer that does not have the effect of holding a position open for the member during a termination separation period; and

   3. (C) Exercise any authority to act as a representative of any system-covered employer or exercise any authority over employees of any system-covered employer.

(b)

1. (1) When a member is no longer employed by an employer in a position covered by the system, the person shall cease to be an active member of the system.

2. (2) If an inactive member has not retired and later becomes reemployed by an employer in a position covered by the system, the member shall become an active member and be eligible to accrue additional service credit.

3. (3) If the member’s service credit during reemployment is less than one-fourth (¼) of a fiscal year under § 24-7-601, he or she shall be considered to be an inactive member at the termination of the reemployed service, and the only monthly benefits payable shall be those provided by § 24-7-707.

4. (4)

   1. (A)

      1. (i) Before July 1, 2011, an active member shall receive credit for any previous unreported service after July 1, 1937, by paying the system the employee and employer contributions in effect during the previous service, together with interest from the dates of the service to the date of payment in full.

      2. (ii) On or after July 1, 2011, previous unreported service rendered after July 1, 1937, may be established by paying the actuarial equivalent of the member’s benefits to the system.

   2. (B) For previous service rendered before July 1, 1971, service credit shall be permitted for service in a fiscal year only if the minimum days of service rendered is sufficient for one (1) year of service credit under § 24-7-601 in a fiscal year.

(c) Upon a member’s retirement, the person shall cease to be an active member and, except as otherwise provided in this act, he or she shall not accrue additional service credit or make contributions to the system.

(d) As used in this section:

1. (1) “System-covered employer” means all employers as defined in § 24-7-202 and also includes all employers offering the Arkansas Teacher Retirement System as an optional retirement plan on or before January 1, 2011, to any employee;

2. (2)

   1. (A) “Terminate” means:

      1. (i) The member’s employment has ended at all system-covered employers;

      2. (ii) A complete severance of the employer-employee relationship has occurred at all system-covered employers;

      3. (iii) The member has ceased performing any employment services for any system-covered employer, except for uncompensated functions related to the transfer of the duties or the transfer of the position of the member;

      4. (iv) The member has not formed any express or implied employment agreement or taken action that would obligate the member to render compensable services to a system-covered employer or entitle a system-covered employer to the services of the member after the termination separation period;

      5. (v) The member has followed normal retirement procedures for resigning from the system-covered employer unless involuntarily terminated before the member’s effective date of retirement; and

      6. (vi) All system-covered employers have paid or have initiated the process to pay all accumulated benefits such as annual leave and sick leave to the member by the effective date of retirement.

   2. (B) “Terminate” does not mean:

      1. (i) Taking a leave of absence; or

      2. (ii) Performing any job duties or services without remuneration, except for the functions related to the transfer of duties or the transfer of the position itself.

   3. (C) Providing volunteer activities at a system-covered employer that does not have the effect of holding a position open for the member during a termination separation period does not mean that the member is not terminated; and

3. (3) “Termination separation period” means the time from a member’s effective date of retirement until the date that the member is no longer prohibited by state law from returning to work at a system-covered employer.