Transcription
April 20182
FRS Investment Plan Employer Handbook ContentsAs an employer, you play an important role in helping your employees make the most of their FRS retirementbenefits. This handbook is intended to explain the administration of the retirement plan choice process andthe FRS Investment Plan in nontechnical language. For detailed information about the FRS Pension Plan,refer to the FRS Pension Plan Handbook.FRS Employer Assistance Line1-866-377-2121, Option 39:00 a.m. to 8:00 p.m. ET, Monday through Friday (except holidays)FRS INVESTMENT PLAN EMPLOYER HANDBOOK CONTENTS . 2ABOUT THE INVESTMENT PLAN . 5FRS INVESTMENT PLAN PROFILE . 5ELIGIBILITY . 6First-Time, Regular Employees .6Rehired Members .7Determining Membership Class .7Eligibility Review .7STENROLLMENT (1 ELECTION) . 8Default Option .8Plan Choice Period (Plan Choice Deadline).8Reporting During the Plan Choice Period .8Enrollment Process .8Getting Help Choosing a Plan.9How to Submit a Plan Choice .10Investment Plan Membership Effective Date .11Opening Balance .11How to Monitor Election Status .11ND2 ELECTION . 11Eligibility .12Getting Help With a 2nd Election .12How to Make a 2nd Election.12Canceling a 2nd Election .12Reversing a 2nd Election .13How to Monitor Election Status .13Changing From the Pension Plan to the Investment Plan . 13Changing From the Investment Plan to the Pension Plan . 14Choosing the Hybrid Option .15PLAN FUNDING . 16Employee Contributions.16Employer Contributions .16Pension Plan Benefit Transfers to the Investment Plan . 17Rollover Deposits (Investment Plan Only).18DROP Member Rollover Deposits (Investment Plan Members) . 18Contribution Limits .19April 20182
Payroll Reporting .19INVESTMENT OPTIONS. 20Account Transactions .20Investment Plan Funds .20TRANSACTIONS . 20Choosing Investment Funds for Future Contributions (Investment Elections) . 20Reallocating Existing Balances .21Excessive Fund Trading Guidelines.21VESTING. 21Unvested Account Balances .22BENEFIT PAYOUTS . 22When a Member Can Take a Payout .223-Month Waiting Period .23Normal Retirement .23Hardships, Loans, and Financial Emergencies . 24Payout Process and Requirements.24How to Submit a Member’s Termination Date . 24When FRS Employment Ends (MyFRS Termination Kit) . 25How to Initiate a Payout .25Payout Methods.25Rollover Methods.25Impact on Retirement Status .25Automatic Payouts (Balances Under 1,000) . 26Required Minimum Payouts .26Taxes and Penalties .26Impact on Health Insurance Coverage.27Invalid Payouts .27MEMBER SERVICES . 28MyFRS Financial Guidance Line .28MyFRS.com.28ChooseMyFRSplan.com .28Workshops .28Personal Appointments.28Live Chat .28Advisor Service.281st Election Choice Service .292nd Election Choice Service .29Calculators .29Videos .29Complaint Procedures .29FINAL ORDERS . 30MEMBER ACCOUNT INFORMATION . 31PERSONAL IDENTIFICATION NUMBERS . 31PIN Reminders .31PIN Changes .31BENEFICIARY DESIGNATION . 31How to Designate a Beneficiary .31Missing Beneficiary Designation .32How to Review Current Beneficiary Designation . 32April 20183
SOCIAL SECURITY NUMBER CORRECTIONS . 32NAME AND ADDRESS . 32Process for Actively Employed Members .32Process for Terminated Members .32ACCOUNT STATEMENTS . 33QUALIFIED DOMESTIC RELATIONS ORDERS . 33OTHER PROGRAMS & BENEFITS . 34HEALTH INSURANCE SUBSIDY . 34OTHER OPTIONAL PROGRAMS . 34RESOURCES . 35CONTACTS . 36FRS EMPLOYER ASSISTANCE LINE . 36MYFRS FINANCIAL GUIDANCE LINE FOR EMPLOYEES . 36INVESTMENT PLAN ADMINISTRATOR . 36How the Investment Plan Administrator Can Help You . 36STATE BOARD OF ADMINISTRATION OF FLORIDA . 37DIVISION OF RETIREMENT (THE DIVISION). 37How the Division Can Help You .37EY . 38How EY Can Help You .38April 20184
About the Investment PlanThe FRS Investment Plan is similar to a 401(k) plan. Members own all contributions and earnings in theirInvestment Plan account after completing 1 year of service. The Investment Plan is designed primarily foremployees who want greater control over their retirement plan and who want flexibility in how their benefit ispaid at retirement.The Investment Plan is known as a “defined contribution” plan. That’s because contributions — theemployee’s and the employer’s — to the Plan are defined by law. The benefit, however, is not defined. Thebenefit the member ultimately receives from the Plan will depend on how much is contributed to themember’s account, the performance of investments over time, and the impact of account fees and expenses.When a member is ready to withdraw money, they will have a variety of payout options to choose from.For more information about the Investment Plan, and to compare it with the Pension Plan, visit the New Hirepage and ChooseMyFRSplan.com.FRS Investment Plan ProfileOfficial Plan NameCommon Plan NameType of PlanFederal Employer IdentificationNumberPlan NumberPlan SponsorPlan TrusteesPlan documents are the FloridaStatutes and the rules of the StateBoard of Administration establishingthe PlanSource of Benefit PaymentsAgent for Service of Legal ProcessAbout the Investment Plan, April 2018Florida Retirement System Investment PlanFRS Investment PlanDefined contribution retirement plan qualified under Section401(a) of the Internal Revenue Code59-6001872002State Board of Administration of Florida (SBA). The SBA ischarged with establishing and administering this Plan.Executive Director, State Board of Administration of Florida,representing the Governor, the Chief Financial Officer, and theAttorney General as the Trustees of the Board.Executive DirectorState Board of Administration of Florida1801 Hermitage Blvd., Suite 100Tallahassee, Florida 32308-7743The address for each of the three Trustees of the Board is: TheCapitol, Tallahassee, Florida 32399Chapter 121, Parts I, II, and III, Rule Title 19, FloridaAdministrative CodeAll benefits payable under the Investment Plan shall be paidsolely from the member’s individual retirement account within theFlorida Retirement System Investment Plan Trust Fund.Executive Director, State Board of Administration of Florida,1801 Hermitage Blvd., Suite 100, Tallahassee, Florida 3230877435
Name of Plan AdministratorDate Plan EffectiveName of EmployerPlan YearPlan Year — Limit MonitoringEmployee Assistance Line:MyFRS Financial Guidance LineFRS Employer Assistance LineEY Financial PlannersDivision of RetirementAlight SolutionsInternet AddressAlight Solutions, FRS Investment Plan Administrator, P.O. Box785027, Orlando, Florida 32878-5027; toll-free telephonenumber: 1-866-446-9377, Option 4 (Telecommunications RelayService [TRS] 711)The Plan became effective July 1, 2000, although the firstmembers in the Plan were effective July 1, 2002.FRS employing agencyJuly 1 through June 30January 1 through December 311-866-446-9377TRS 711Representatives are available 9:00 a.m. – 8:00 p.m. ET, Monday– Friday (except holidays).1-866-377-2121Option 1, 9:00 a.m. – 8:00 p.m. ETOption 2, 8:00 a.m. – 5:00 p.m. ETOption 3, 9:00 a.m. – 8:00 p.m. ETMyFRS.comEligibilityHave All New Employees Sign This FormHave all new hires sign and date a Florida Retirement System (FRS) - Certification Form. This form couldprotect your agency from having to repay any retirement benefits paid to a retiree whom you employ inviolation of the reemployment-after-retirement provisions.By signing this form, the new employee is certifying that they have not retired from any State of Floridaadministered retirement plan or have not concluded participation in the DROP. Keep the signed form in theemployee’s personnel file. Do not send it to the FRS unless you are asked to do so.For clarification of the rules and laws regarding reemployed retirees, contact an EY financial planner (forInvestment Plan members) or the Division of Retirement (for Pension Plan members).First-Time, Regular EmployeesAn employee who is hired in a regularly established FRS-covered position, and has never completed an FRSchoice period, is eligible to participate in the Investment Plan or Pension Plan, unless they participate in oneof the following plans: Deferred Retirement Option Program (DROP)Terminated DROP members can roll over their DROP accumulation into the Investment Plan. Mandatory State University System Optional Retirement Program (SUSORP)Faculty, including clinical faculty, in a college at a state university that has a faculty practice plan aremandatory participants of the SUSORP. Teachers’ Retirement SystemThis plan is closed to new members.About the Investment Plan, April 20186
State and County Officers’ and Employees’ Retirement SystemThis plan is closed to new members.Rehired MembersTerminated Investment Plan members who are later rehired will be readmitted to the Investment Plan aslong as they have not taken a payout from the Investment Plan. Rehired members who previouslyparticipated in the Pension Plan will return to the Pension Plan.Investment Plan members who take a payout or rollover from the Investment Plan (excluding a de minimisdistribution or a Required Minimum Distribution) will be considered retired. (For more information, refer toBenefit Payouts.) Once retired, members lose any non-vested Investment Plan or prior Pension Plan serviceand benefit.The Division of Retirement is responsible for determining retirement membership eligibility and whether amember is eligible for continued FRS membership. Refer to the Division’s Pension Plan Employer Handbookfor information about employee eligibility and payroll reporting requirements and format.Retirees Reemployed Prior to July 1, 2010Retired members who were rehired in an FRS-covered position prior to July 1, 2010 are considered“reemployed retirees” and are subject to the rules and laws governing such members. These reemployedretirees were treated like first-time, regular employees and were given a new election period. However,reemployed retirees are not entitled to certain benefits under the FRS, including Special Risk Classmembership, disability benefits, and the Deferred Retirement Option Program (DROP).Investment Plan Retirees Employed on or After July 1, 2017Effective July 1, 2017, retirees of the Investment Plan, State University System Optional Retirement Program(SUSORP), Senior Management Service Optional Annuity Program (SMSOAP), and State CommunityCollege System Optional Retirement Program (SCCSORP) are eligible for renewed membership. They mustbe employed in an FRS-covered position on or after July 1, 2017 to gain renewed membership. However,these renewed members are not eligible to participate in the Pension Plan or DROP, receive disabilityndbenefits, or use the 2 Election to change to the Pension Plan.It is important to note that this provision does not provide renewed membership retroactively for the period ofJuly 1, 2010 to June 30, 2017.Determining Membership ClassTo determine an employee’s membership class, refer to the Division’s Pension Plan Employer Handbook formore information.Eligibility ReviewAn employee’s enrollment in the Investment Plan is subject to eligibility review at any time. If the enrollmentis determined to be ineligible, the election and any associated benefit transfers, payroll contributions, andany earnings on these funds will be reversed. The employee will receive a letter explaining the reason for thereversal. The following are a few examples of reasons an employee’s enrollment may be reversed: Employee terminated prior to receipt of election form.About the Investment Plan, April 20187
Employee did not earn service credit in the month the election form was received. Employee is in a position not eligible for membership in the FRS.Enrollment (1st Election)stThe 1 Election is the employee’s opportunity to choose an FRS retirement plan before they areautomatically enrolled in their default option. Having a choice between two employer-provided retirementplans is not common and many employees may not realize they need to take action. As an employer, yousthave an important role to play in the 1 Election. Help your new employees realize they have a choiceto make and encourage them to take advantage of the member services available to help them makethat choice.Default OptionFor all new FRS-covered employees hired prior to January 1, 2018, the default option is the Pension Plan.For FRS-covered employees in the Special Risk class hired on or after January 1, 2018, the default option isthe Pension Plan.For FRS-covered employees in all other membership classes hired on or after January 1, 2018, the defaultoption is the Investment Plan.Plan Choice Period (Plan Choice Deadline)For all new FRS-covered employees hired prior to January 1, 2018, the plan choice deadline is 4:00 p.m. onthe last business day 5 months after their month of hire.For all new FRS-covered employees hired on or after January 1, 2018, the plan choice deadline is 4:00 p.m.on the last business day 8 months after their month of hire.The FRS sends reminders directly to new employees during their choice period. You can help youremployees make a timely and informed decision by sending your own reminders and directing them toChooseMyFRSplan.com.Any elections received after the plan choice deadline will be invalid.Reporting During the Plan Choice PeriodThrough the month they are enrolled in a plan (either through an active election or default), all new FRScovered employees are reported under the Pension Plan. After they enrolled, they are reported under theappropriate plan.For members who default to the Investment Plan, employee and employer contributions paid through thedate of default will be transferred to the Investment Plan and placed in an age-appropriate Retirement DateFund. Any time after their account is activated, the member can change to any of the Plan’s availableinvestment options.Enrollment Process1. Candidate signs Florida Retirement System (FRS) - Certification Form.About the Investment Plan, April 20188
2. Candidate is hired.3. Employee is enrolled automatically in the Pension Plan so that contributions can begin with theemployee’s first paycheck.4. Employer determines membership class.5. Employer reports employee as a Pension Plan member on first available payroll.6. If the employee is:oA new FRS member: A New Employee FRS Enrollment Kit is generated and mailed to thenew member’s address on file. The kit includes a Benefit Comparison Statement, as well asthe member’s Personal Identification Number and plan choice deadline date. The kit shouldarrive within 30 to 60 days of the payroll on which the employee is first reported. The kit maybe delayed if there are errors in reporting the new member.oA retiree of the Investment Plan, SUSORP or SCCSORP: A confirmation of renewedenrollment and a welcome flyer are generated and mailed to the reemployed retiree’saddress on file within 30 to 60 days of the payroll on which the employee is first reported.The member can access their Investment Plan account by logging in to MyFRS.com byusing their previous User ID and Password. If the member does not remember the User IDand Password or never logged in to MyFRS.com, they can call the MyFRS FinancialGuidance Line at 1-866-446-9377, Option 2.7. Employers help educate new employees about plan choice by conducting New Hire Orientation,directing the employee to ChooseMyFRSplan.com and the MyFRS Financial Guidance Line, andproviding the Choose Your FRS Retirement Plan orientation brochure.8. Employee’s payroll data is processed. An eligible employee’s plan choice cannot be processedbefore their payroll data is processed. Until their payroll data is processed, elections by phonecannot be performed and elections submitted by form (online or hard copy) will be pended.9. New FRS members will receive plan choice reminder emails and letters, distributed by the FRS.st10. The employee makes an active 1 Election choice by their plan choice deadline or is automaticallyenrolled in their default option.11. A confirmation letter is mailed to the employee’s address on file indicating their plan choice. At thisstpoint, the 1 Election is considered final even if the employee did not submit an election and wasautomatically enrolled in their default option.Getting Help Choosing a PlanThe FRS offers members a variety of services to help them make an informed plan election. Refer membersto these services: ChooseMyFRSplan.com – Employees can answer several questions using this guided experience tolearn which plan may make the most sense for them. They can view a series of “people like me”video and review other resources while on the site. MyFRS Financial Guidance Line – Members can call 1-866-446-9377, Option 2 (or TRS 711) andspeak with a financial planner 9:00 a.m. to 8:00 p.m. ET, Monday through Friday, except holidays.About the Investment Plan, April 20189
st 1 Election Choice Service – Employees can compare estimated benefits for each retirement plan.The employee can access the tool when they sign in on MyFRS.com with their PIN that was sent tothem with the new hire Benefit Comparison Statement. New Hire Orientation - Conducted by the employer; see the New Hire Orientation Presentation.How to Submit a Plan ChoiceMembership classification determines how the employee can enroll. Enrollment forms are available in theForms section of this website.Regular Class and Special Risk Class Employees1. Online EZ Enrollment Form. This is an online enrollment form most members can complete withoutlogging in to MyFRS.com. Online enrollments submitted before 4:00 p.m. ET are processed within24 hours and are effective on the date the election is submitted (excluding holidays). If submittedafter 4:00 p.m. ET, but before the member’s plan choice deadline, the election will be effective thenext business day (excluding holidays).2. EZ Enrollment Form. This form is included in the New Employee FRS Enrollment Kit. It can also bedownloaded from MyFRS.com. Complete, accurate and signed enrollment forms sent to the PlanChoice Administrator before the member’s plan choice deadline are processed within 2 businessdays of receipt (excluding holidays) and the enrollment is effective on the day the form is received(excluding holidays).3. MyFRS.com. The employee must log in to the site. Online enrollments submitted before 4:00 p.m.ET are processed within 24 hours and are effective on the date the election is submitted (excludingholidays). If submitted after 4:00 p.m. ET, but before the member’s plan choice deadline, the electionwill be effective the next business day (excluding holidays).4. MyFRS Financial Guidance Line. Telephone enrollments made before 4:00 p.m. ET are processedwithin 24 hours and are effective on the date the election is submitted (excluding holidays). Ifsubmitted after 4:00 p.m. ET, but before the member’s plan choice deadline, the election will beeffective the next business day (excluding holidays).All Other Memb
About the Investment Plan The FRS Investment Plan is similar to a 401(k) plan. Members own all contributions and earnings in their Investment Plan account after completing 1 year of service. The Investment Plan is designed primarily for employees who want greater control over their retirement plan and who want flexibility in how their benefit is
