Support Staff Policies & Procedures

403(b) Retirement Plan Policy & Procedure

(Revised 09/2016)

Policy

The University provides a defined contribution plan operated under section 403(b) of the Internal Revenue Service (IRS) Code for eligible employees, called the Michigan State University 403(b) Retirement Plan ("Plan").  The Plan is comprised of two main parts, the 403(b) Base Retirement Program ("BRP") and the 403(b) Supplemental Retirement Program ("SRP").  The Plan also includes an additional University-paid contribution for eligible employees hired July 1, 2010 and later.

403(b) Base Retirement Program ("BRP")

Eligibility:

Benefits eligible positions for faculty, academic staff and executive management are defined as 50% or greater employment for a continuous period of 9 months or longer.  Benefits eligible positions for support staff are defined as regular full-time (90-100%) and part-time (50-89.9%) employment without an end date of less than 9 months.

 


The following benefits eligible employees are immediately eligible to receive the University matching contribution:

Administrative Professional Association (APA), Administrative Professional Confidential/Non-Union, Assistant Professor, Associate Professor, Coach, Contract Appointments (Coordinator, Director, etc.), Executive Management, Fraternal Order of Police (FOP), Hall Director (University Housing), IATSE Local 274, IUOE Local 324, Librarian, MSU Extension Academic Staff (Agent, Associate, Program Director, Home Economist), Nurse, Professor, Resident Advisor, Senior Research Associate, Specialist (CAS Probationary).  These employees are required to participate in the BRP when they reach age 35 and have 24 full-time equivalent (FTE) months of continuous employment.


The following benefits eligible employees are immediately eligible to receive the University matching contribution:

Administrative Professional Supervisors Association (APSA), AFSCME Local 1585 (including Off-campus), AFSCME Local 999, Clerical Technical Confidential, Clerical Technical Off-campus, Clerical Technical Union (CTU), MSU Extension Support Staff (4-H Program Associates).  These employees are required to participate in the BRP when they reach age 35 regardless of their length of service.


The following benefits eligible employees are eligible to receive the University matching contribution, after completing 24 FTE service months of continuous employment:

Fixed-Term Appointments (Specialist, Coordinator, etc.), Instructor, Assistant Instructor, Lecturer, Research Associate (hired prior to 10/1/2006), Off-campus and Non-union (except MSU Extension Support Staff).  These employees are required to participate in the BRP when they reach age 35 and have 24 FTE months of continuous employment.


The following benefits eligible employees are eligible to receive the University matching contribution, after completing 36 FTE service months of continuous employment:

Research Associate (hired on or after 10/1/2006). These employees are required to participate in the BRP when they reach age 35 and have 36 FTE months of continuous employment.


The following benefits eligible employees are eligible to receive the University matching contribution, after completing 24 FTE service months of continuous employment:

Consultant, Instructor Intern/Resident, Teacher and Visiting Scholar.  These employees are NEVER required to participate in the BRP.



Summary of benefits and features:
  • The benefit provides income during retirement and benefit payments to a beneficiary in the event of death prior to retirement.
  • Employee contributions are 5% of base pay, subject to collective bargaining agreements, and University matching contributions are 10% of the same pay.
  • Contributions are on a tax-deferred basis contributed to an account held at a retirement vendor, and are 100% vested.
  • Contributions cease with the last day of paid employment or a change to an ineligible employment status.
  • Withdrawals are allowed after retirement or termination, regardless of age or length of service, and may be subject to vendor requirements.
  • In-service withdrawals are subject to IRS guidelines and are permitted under the following situations: 
    • age 59 1/2
    • disability
    • death
  • Loan options may be available. Please visit 403(b) Loan Provisions of the Human Resources website for specific information on loan options.
  • A more detailed summary of the benefits and features is available in the online Enrollment Guide.
  • The MSU 403(b) Retirement Plan Document provides more detail and governs the administration of the Plan.
  • University operating guidelines and administrative policies provide an offset to Workers' Compensation payments due to receiving Base Retirement Program income. Please review the Workers' Compensation Policy for further detail.
  • The University's Long-Term Disability (LTD) program provides a benefit to the Base Retirement Program when an employee is receiving LTD benefits.  Please review the Long-Term Disability Policy for further detail.

Procedure

Application for enrollment:

  • Employees may enroll at any time after gaining eligibility and prior to mandatory participation. Enroll online at the EBS Portal.  Review the Enrollment Instructions for more detail.
  • The enrollment process will be effective either the current pay period or the next pay period, depending on the payroll processing date. New employees and newly eligible employees may have Base Contributions applied retroactively if they enroll within the first applicable time range. Review the Enrollment Instructions for more detail.

Changes in coverage or personal information:

 

403(b) Supplemental Retirement Program ("SRP")

Eligibility: All employees of MSU (including temporary and on-call employees, and those that are not eligible for other benefits) who receive compensation reportable on an Internal Revenue Service form W-2 are eligible to participate in the Supplemental Retirement Program, except non-resident aliens earning income outside of the United States and student employees.

Summary of benefits and features:

  • The benefit provides income during retirement and benefit payments to a beneficiary in the event of death prior to retirement.
  • Employee voluntary contributions are a percentage of pay.
  • Contributions are on a tax-deferred basis contributed to an account held at a retirement vendor, and are 100% vested.
  • Contributions cease with the last day of paid employment, a change to an ineligible employment status, or designation by the employee to stop future contributions.
  • Withdrawals are allowed after retirement or termination, regardless of age or length of service, and may be subject to vendor requirements.
  • In-service withdrawals are subject to IRS guidelines and are permitted under the following situations:
    • age 59 1/2
    • disability
    • death
  • Loan options may be available.  Please visit 403(b) Loan Provisions of the Human Resources website for specific information on loan options.
  • A more detailed summary of the benefits and features is available in the online Enrollment Guide.
  • The MSU 403(b) Retirement Plan Document provides more detail and governs the administration of the Plan. 

Procedures

Application for enrollment:

  • Employees may enroll at any time after becoming eligible.  Enroll online at the EBS Portal.  Review the Enrollment Instructions for more detail.
  • The enrollment process will be effective either the current pay period or the next pay period, depending on the payroll processing date.

Changes in coverage or personal information:

 

Additional University-paid Contribution for Employees Hired On or After July 1, 2010 ("Additional Employer Contributions")

Eligibility:

Benefits eligible employees who are hired as support staff on or after July 1, 2010 are eligible to receive an additional employer contribution to the MSU 403(b) Retirement Plan that is paid by the University.  Both union and non-union support staff are eligible to receive the benefit. Please see the Retiring from the University Policy and applicable collective bargaining agreement for support staff employees who have service credit with MSU prior to July 1, 2010 and were rehired on or after July 1, 2010.

Summary of benefits:

Benefits eligible support staff employees will receive a University contribution based on the employee's eligible earnings per pay period to a MSU designated retirement vendor of the MSU 403(b) Retirement Plan.  The University contribution will be 0.5% for the employee's first 120 vacation service months, and 0.75% thereafter.  All University contributions are 100% vested.

An account will be opened for the employee at the designated retirement vendor and the contributions will be made to a default investment option, unless the employee already has an account at the designated retirement vendor.  The employee can choose to select his/her own investments from the options available at any time.

For support staff employees hired on or after July 1, 2010 and before the effective date of the applicable collective bargaining agreement of 2014 or 2015, the benefit implementation will follow the applicable collective bargaining agreement language, including any lump sum contributions.

A summary of the MSU 403(b) Retirement Plan's benefits and features is available in the online Enrollment Guide.

Refer questions to: MSU Human Resources (telephone 517-353-4434 or email solutionscenter@hr.msu.edu).

Revision History -

9/9/16 - updated benefits eligible definitions, deleted outdated summary and other information, added the online Enrollment Guide and Plan Document links, added updated policy information from the former "Supplemental Retirement Plan" policy, and added new information about the Additional Employer Contribution for support staff hired on or after July 1, 2010. 

5/27/16 - updated title

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