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Sorting Out the Changed Pension Choices for

Adjunct Faculty and Part-Time Instructors


AFT legislative efforts have culminated in pension reform legislation, chapter 89, Public Laws of 2008, recently passed by the State Legislature and signed into law by Governor Corzine on September 29, 2008. As a result, any adjunct faculty member or part-time instructor whose employment begins after October 31, 2008 is eligible to participate in the Alternate Benefits Program (ABP).


Among the reforms contained in that law was a change in the definition of “member” or “participant” under the ABP to include adjunct or part-time faculty. Effect November 1, 2008, any new adjunct faculty or a new part time instructor entering service under a new employment agreement will be required to participate in the ABP and is no longer eligible to participate in the Public Employees’ Retirement System (PERS). Additionally, any existing adjunct faculty member or a part-time instructor employed under an agreement which took effect prior to November 1, 2008 will become eligible to participate in the ABP once a new employment agreement is executed and the individual enters service under that agreement. THAT WOULD BE THE BEGINNING OF THE SPRUNG, 2009 SEMESTER.


The Alternate Benefit Program is a defined contribution plan that offers substantial opportunities for long-term tax-deferred investment. Six investment carriers are authorized to provide investment options and services in the ABP. The program allows members to direct their own retirement accounts while offering portability of accumulated contribution balances. The member and employer make regular tax-deferred contributions toward retirement savings. Members contribute 5% of base salary and employers contribute 8% of base salary. Under the voluntary 403(b) component of the program, members may make additional contributions on a tax-deferred basis.


A member is vested in the ABP when beginning the second year of employment at the member’s institution of higher education or if the member has an existing qualified retirement account from a previous employer, the member is immediately vested. Once vested, all of the contributions and accumulations in the member’s account belong to the member, and will provide benefits to the member when he or she is eligible to receive them. If a member leaves the institution of higher education prior to becoming vested, he or she will receive a refund of the “employee” contributions, including any investment gain or loss. The “employer” contributions will be returned to the employer. Enrollment of adjunct faculty members and part-time instructors in the ABP should begin immediately upon the commencement of employment and not after the completion of 12-months or service as was the case for enrollment into PERS prior to this change in law.


Adjunct Faculty Members and Part time Instructors already enrolled in the PERS who enter into a new employment agreement after October 31, 2008, must choose to either: A) Irrevocably waive their benefits under the ABP and continue their participation in the PERS, or B) Irrevocably waive their benefits under the PERS and transfer their accumulated pension service, contributions and any available employer contribution sunder PERS to the ABP.


 What this means is that the employer’s contribution will be transferred into your ABP account only after you have accrued ten years of non-concurrent service credit under a combination of PERS or TPAF and the ABP. Your contributions to PERS will transfer upon election of the ABP.


Each Adjunct Faculty Member or Part-time Instructor participating in the PERS must make this election by completing an Election of Retirement Coverage form within 30 days following commencement of employment in the ABP eligible position.


 If you do not make an election to waive benefits under one of the two retirement systems, you will lose the right to have all retirement credit consolidated under one retirement account and you may lose those benefits which have not yet vested.


Members are encouraged to consider the options available to them, make their choice, and submit forms to your employer’s HR department promptly. Looking ahead, we also suggest you photocopy these forms and put them away for safekeeping just in case you need them on retirement day. Adjunct faculty teaching on multiple campuses should file ABP Election of Retirement Coverage as necessary with each employer.


For adjunct faculty members who are already vested in the PERS or close to vesting in the PERS plan, you may wish to remain with PERS. If you feel you will be teaching as an Adjunct Faculty Member or Part-Time Instructor in the future, but have only been doing so for a brief period of time, seriously consider electing for the ABP, as the vesting in this plan is much sooner and you won’t have to worry about achieving ten years of service to vest as in PERS. In any case, you are encouraged to review the above information, and apply it to your individual situation. Those who were hired in Fall 2007, Spring 2008 or Fall 2008 were not yet eligible for PERS and will have no decision to make. If they return in the Spring 2009 or later semesters, they will be considered new hires and will automatically be in the ABP. There is one very important point to remember after you become vested in the ABP. If you decide you won’t be teaching again for awhile and decide to move your accrued benefits from the ABP to another retirement program such as a 401(k) or 403(b) plan outside of the ABP, you will be considered retired from the State for pension purposes. If you are employed by the State in any capacity at some future date, you will no longer be eligible for new pension benefits.


AST’s goal in working with legislators and the Governor’s office was to preserve pension benefits for part-time and adjunct faculty. We are not, nor do we purport to be your investment counselor or your tax accountant and urge you to seek that sort of advice from the proper source if it is necessary to your decision making. For more detailed information on the Alternate Benefit Program and the six investment carriers visit


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