Chapter 40

40.21(5) (5) Whenever any employer is created, the territory of which includes more than one-half of the last assessed valuation of an employer which at the time of creation was a participating employer on a basis other than that specified in sub. (3) or (4) and the employer so created assumes the functions and responsibilities of the previous employer with respect to the territory, then the employer so created shall automatically be a participating employer from its inception, but no prior service credits shall be provided for any personnel of the employer unless the new participating employer adopts a resolution as provided in sub. (1). If a resolution is adopted, no employee shall receive prior service credit for any period of service which was previously covered by a retirement system.

40.21(6) (6) 

40.21(6)(a) (a) Any employer electing to be included within the provisions of the Wisconsin retirement system in accordance with this section may in the resolution and in the certified notice of election recognize 100 percent, 75 percent, 50 percent, 25 percent or none of the prior creditable service of its employees earned by the employees while employed by the employer, if the same percentage of each employee’s prior creditable service is recognized.

40.21(6)(b) (b) Any employer which recognizes less than all of the prior creditable service of its employees under par. (a) may adopt another resolution as provided in this section, increasing, for each person who is still a participating employee on the effective date of the increase determined under this section, the percentage of the employee’s prior creditable service which is recognized to one of the higher levels provided by par. (a) provided the accumulated percentage does not exceed 100 percent.

40.21(6)(c) (c) Whenever the percentage of recognized prior creditable service is increased as provided in par. (b), the employer contributions computed under s. 40.05 (2) shall be increased to reflect the value of the increased prior creditable service being granted, amortized over the remainder of the funding period provided for prior creditable service costs of that employer.

40.21(7) (7) 

40.21(7)(a) (a) Subject to pars. (b) and (c), any employer that elects to be included within the provisions of the Wisconsin Retirement System under sub. (1) on or after March 2, 2016, may elect to be a participating employer only with respect to employees hired on or after the date on which the employer elects to participate in the Wisconsin Retirement System. Any employer that makes such an election shall do so in writing on a form provided by the department.

40.21(7)(b) (b) Any municipal employer, other than a 1st class city or county with a population of at least 750,000, that elects to be included within the provisions of the Wisconsin Retirement System under sub. (1) on or after March 2, 2016, may choose not to include any of its public utility employees.

40.21(7)(c) (c) Any municipal employer that elects to be included within the provisions of the Wisconsin Retirement System under sub. (1) on or after March 2, 2016, and that elects to be a participating employer under par. (a), may offer its current employees the option of becoming participating employees in the Wisconsin Retirement System. If an employee elects to become a participating employee, the employee shall make the election in writing on a form provided by the department before the effective date that the employer becomes a participating employer.

40.21 History History: 1981 c. 96; 1987 a. 309; 1987 a. 403 s. 256; 1989 a. 56 s. 259; 1993 a. 383; 2001 a. 16; 2015 a. 174, 187; 2023 a. 12.

40.21 Annotation Sub. (4) limits prospective mandatory Wisconsin Retirement System coverage to present and future police and firefighter employees of cities and villages that had police and firefighter employees included in the Wisconsin Retirement Fund prior to March 31, 1978. 75 Atty. Gen. 34.

40.22 40.22 Participating employees.

40.22(1) (1) Except as otherwise provided in sub. (2) and s. 40.26 (6), each employee currently in the service of, and receiving earnings from, a state agency or other participating employer shall be included within the provisions of the Wisconsin retirement system as a participating employee of that state agency or participating employer.

40.22(2) (2) No person may be included within, or receive benefits from, the Wisconsin retirement system for any service if any of the following conditions apply:

40.22(2)(a) (a) Except as provided in sub. (2m), the employee was a participating employee before July 1, 2011, and is not expected to work at least one-third of what is considered full-time employment by the department, as determined by rule.

40.22(2)(am) (am) Except as provided in sub. (2r), the employee was not a participating employee before July 1, 2011, and is not expected to work at least two-thirds of what is considered full-time employment by the department, as determined by rule.

40.22(2)(b) (b) The employee’s expected duration of employment is less than one year.

40.22(2)(c) (c) The employee is excluded from participation by s. 40.21 (3) or (4).

40.22(2)(cm) (cm) The employee is excluded from participation by s. 40.21 (7).

40.22(2)(d) (d) The employee is subject to s. 40.19 (4) provided that contributions and benefits shall be paid as provided by that subsection.

40.22(2)(e) (e) The employee is subject to a contract involving the furnishing by the person of more than the person’s personal services.

40.22(2)(f) (f) The employee is a member of a retirement system of a 1st class city and was an employee of a technical college district created under ch. 38 on the date the district was created.

40.22(2)(g) (g) The employee is appointed by the university under s. 36.19, or by the University of Wisconsin Hospitals and Clinics Authority, as a student assistant or employee in training or is appointed by a school or other education system in which the person is regularly enrolled as a student and is attending classes to perform services incidental to the person’s course of study at that school or education system.

40.22(2)(gm) (gm) The employee is initially employed by a participating employer on or after April 23, 1992, is under the age of 20 and is regularly enrolled, or is expected to be regularly enrolled, as a full-time student in a school, as defined in s. 118.257 (1) (d).

40.22(2)(h) (h) The employee is teaching while on leave from an educational institution not a part of the University of Wisconsin System, if the person is a visiting professor, visiting associate professor, visiting assistant professor or visiting lecturer at the university and if the employment at the university is all within 12 consecutive calendar months. If the employment at the university is continued beyond the 12-month period the person shall, at the start of the 13th consecutive calendar month of employment, come under the system for future service.

40.22(2)(i) (i) The employee contributes to the employee retirement system of the county of Milwaukee if the person was contributing to that system on September 10, 1959.

40.22(2)(j) (j) The employee is employed by a transportation system in a position that is excluded from the Wisconsin retirement system and is included in another retirement system under s. 66.1023.

40.22(2)(k) (k) The employee is eligible to receive similar benefits from any other state covering the same service and earnings.

40.22(2)(L) (L) The employee is employed by a participating employer after the person becomes an annuitant, unless the service is after the annuity is suspended under s. 40.26.

40.22(2)(m) (m) Notwithstanding sub. (3m), the employee was formerly employed by Milwaukee County, is a state employee described in s. 49.825 (4) or (5) or 49.826 (4), and is a covered employee under the retirement system established under chapter 201, laws of 1937, pursuant to s. 49.825 (4) (c) or (5) (c) or 49.826 (4) (c).

40.22(2m) (2m) Except as otherwise provided in s. 40.26 (6), an employee who was a participating employee before July 1, 2011, who is not expected to work at least one-third of what is considered full-time employment by the department, as determined by rule, and who is not otherwise excluded under sub. (2) from becoming a participating employee shall become a participating employee if he or she is subsequently employed by the state agency or other participating employer for either of the following periods:

40.22(2m)(a) (a) At least one year for at least one-third of what is considered full-time employment by the department, as determined by rule, or, for an educational support personnel employee, at least one year for at least one-third of what is considered full-time employment for a teacher.

40.22(2m)(b) (b) At least 600 hours in the immediately preceding 12-month period.

40.22(2r) (2r) Except as otherwise provided in s. 40.26 (6), an employee who was not a participating employee before July 1, 2011, who is not expected to work at least two-thirds of what is considered full-time employment by the department, as determined by rule, and who is not otherwise excluded under sub. (2) from becoming a participating employee shall become a participating employee if he or she is subsequently employed by the state agency or other participating employer for either of the following periods:

40.22(2r)(a) (a) At least one year for at least two-thirds of what is considered full-time employment by the department, as determined by rule, or, for an educational support personnel employee, at least one year for at least two-thirds of what is considered full-time employment for a teacher.

40.22(2r)(b) (b) At least 1,200 hours in the immediately preceding 12-month period.

40.22(3) (3) Except as otherwise provided in s. 40.26 (6), a person who qualifies as a participating employee shall be included within, and shall be subject to, the Wisconsin retirement system effective on one of the following dates:

40.22(3)(a) (a) The employer’s effective date of participation if the person is an employee of that employer on the employer’s effective date and has met all requirements for inclusion on or prior to that effective date.

40.22(3)(b) (b)

40.22(3)(b)1. 1. The first day after completion of one year of employment for at least one-third of what is considered full-time employment by the department, as determined by rule, if the person becomes a participating employee under sub. (2m) after the employer’s effective date of participation.

40.22(3)(b)2. 2. The first day after completion of one year of employment for at least two-thirds of what is considered full-time employment by the department, as determined by rule, if the person becomes a participating employee under sub. (2r) after the employer’s effective date of participation.

40.22(3)(c) (c) The first day of employment if the person is a participating employee not covered under par. (a) or (b).

40.22(3m) (3m) Any employee who becomes a participating employee shall continue to be a participating employee notwithstanding sub. (2) (a) or (b) for periods of subsequent employment with that state agency or other participating employer unless the employment with the state agency or other participating employer is terminated for 12 or more consecutive calendar months or unless the employee receives a benefit under s. 40.23, 40.25 (1) or (2) or 40.63.

40.22(4) (4) For purposes of s. 40.02 (25), a person who is employed by a state agency shall be deemed to have become a state employee on the date the person becomes a participating state employee. No participating employee may be included under s. 40.52 (3).

40.22(5) (5) A determination as to whether an employee has met or will meet the actual or anticipated performance of duty or other requirements of this section shall be made by the employer in accordance with rules of the department. The department may by rule identify circumstances and establish procedures under which eligibility for participation shall be based on combined employment when a person is employed by 2 or more employers.

40.22(6) (6) Notwithstanding subs. (1), (2), (3), (4) and (5), if an employee’s employment with an employer terminates after a period of service of less than 30 calendar days, the employee is not eligible for retirement coverage for that period of service. This subsection shall not apply to employment covered under sub. (3m) and shall not affect an employee’s eligibility for insurance coverage for that period of service.

40.22 History History: 1981 c. 96, 386; 1989 a. 13; 1991 a. 152; 1993 a. 399; 1995 a. 216; 1997 a. 69, 110; 1999 a. 150 s. 672; 2001 a. 104; 2009 a. 15, 28; 2011 a. 32; 2013 a. 20; 2015 a. 174; 2017 a. 362; 2019 a. 185.

40.23 40.23 Retirement annuities.

40.23(1) (1) 

40.23(1)(a) (a) Except as provided in par. (am), any participant who has attained age 55, and any protective occupation participant who has attained age 50, on or before the annuity effective date shall be entitled to a retirement annuity in accordance with the actuarial tables in effect on the effective date of the annuity if the participant submits an application for a retirement annuity on a form furnished by the department and all of the following apply:

40.23(1)(a)1. 1. The participant is separated, regardless of cause, and continues to be separated until the annuity effective date, from all employment meeting the qualifications for inclusion specified in s. 40.22 for any participating employer.

40.23(1)(a)2. 2. The participant is not on authorized leave of absence from any participating employer.

40.23(1)(am) (am)

40.23(1)(am)1. 1. In this paragraph “part-time service” is service in a position normally requiring actual performance of duty during fewer than 1,044 hours per calendar year.

40.23(1)(am)2. 2. Any participant who has attained age 55 and who is a participant because of employment other than part-time service as an elected official and who is also a participating employee because of part-time service as an elected official and any protective occupation participant who has attained age 50 and who is also a participating employee because of part-time service as an elected official may, after termination of all covered employment other than service as a part-time elected official, waive further participation under the fund for his or her current, and any future, part-time service as an elected official. Any election under this paragraph is irrevocable and is effective beginning the day after the date of election. Notwithstanding par. (a), any participant who elects under this paragraph may receive a retirement annuity for all service under the fund credited to the participant to the date he or she elects. The date a participant elects under this paragraph is deemed to be the date of separation from the last participating employer by which that participant was employed.

40.23(1)(am)3. 3. No participant who elects under subd. 2. may have his or her annuity suspended under s. 40.26 (1) because of earnings received for any part-time services as an elected official.

40.23(1)(b) (b) Except as provided in par. (bm), all retirement annuities shall be effective on the day following, or on the first day of a month following, the date of separation from the last participating employer by which the participant was employed, as specified by the participant in the written application for the annuity. However, the date shall not be more than 90 days prior to the date of receipt of the application by the department. The participant may specify that additional contribution accumulations shall not be applied to provide an annuity until a subsequent application is filed for an annuity to be paid from the additional contribution accumulations. The subsequent application shall be made as specified under sub. (4) or the department shall automatically distribute the accumulated additional contribution accumulations as a lump sum.

40.23(1)(bm) (bm) If an application by a participant age 55 or over, or by a protective occupation participant age 50 or over, for long-term disability insurance benefits is disapproved under rules promulgated by the department, the date which would have been the effective date for the insurance benefits, or the day after the date of separation from the last participating employer, whichever is later, shall be the retirement annuity effective date if requested by the applicant within 60 days of the disapproval or, if the disapproval is appealed, within 60 days of the final disposition of the appeal.

40.23(1)(d) (d) An application for an annuity to be effective on the day following termination of employment may be filed prior to the employee’s anticipated termination date. The participant shall state the anticipated termination date in the application and the department shall not make an annuity payment until the employee has terminated.

40.23(1)(e) (e) Whenever it is determined that an annuity effective date is incorrect, the annuity effective date shall be corrected and any related computational and payment adjustments shall be made.

40.23(1)(f) (f) Any participating employee may be retired by the employer after attainment of the employee’s normal retirement date, under policies established or agreed to by the employer, except:

40.23(1)(f)1. 1. As prohibited by federal law or by s. 111.33.

40.23(1)(f)2. 2. Each elected official’s and each sheriff’s employment shall be continued to the end of the official’s or sheriff’s term of office and to the end of each subsequent term of office to which elected.

40.23(1)(f)4. 4. Any employer may, in a collective bargaining agreement, limit its right to require retirement.

40.23(2) (2) Except as provided in s. 40.19 (2), this subsection applies only to participants who are not participating employees after March 9, 1984. The retirement annuity in the normal form shall be an annuity payable for the life of the annuitant with a guarantee of 60 monthly payments. Except as provided in sub. (3), the initial monthly amount of the normal form annuity shall be the amount which, when added to the OASDHI benefit, equals 85 percent of the participant’s final average earnings plus the amount which can be provided under pars. (a) and (c) and adjusted under pars. (d) and (e) or, if less, shall be in the monthly amount equal to the sum of the amounts determined under pars. (a), (b) and (c) as modified by pars. (d) and (e) and in accordance with the actuarial tables in effect on the annuity effective date.

40.23(2)(a) (a) The annuity which can be provided from a sum equal to 200 percent of the excess accruing after June 30, 1966, for teacher participants, or December 31, 1965, for all other participants, of the participant’s required contribution accumulation reserved for a variable annuity over the amount to which the contributions would have accumulated if not so reserved. If the participant’s required contribution accumulation reserved for a variable annuity is less than the amount to which the contributions would have accumulated if not so reserved, the annuity shall be reduced by the amount which could be provided by a sum equal to 200 percent of the deficiency.

40.23(2)(b) (b) A monthly annuity in the normal form computed on the basis of the participant’s final average earnings and creditable service, if the annuity becomes effective on or after the normal retirement date of the participant, determined by multiplying the participant’s final average earnings by the participant’s creditable service and the following applicable percentage:

40.23(2)(b)1. 1. For each participant for creditable service of a type not otherwise specified in this paragraph, 1.3 percent.

40.23(2)(b)2. 2. For each participant for creditable service as an elected official and for executive service, as defined under s. 40.02 (31), 1985 stats., 1.8 percent.

40.23(2)(b)3. 3. For each participant, subject to Titles II and XVIII of the federal social security act, for service as a protective occupation participant, 1.8 percent.

40.23(2)(b)4. 4. For each participant not subject to Titles II and XVIII of the federal social security act, for service as a protective occupation participant, 2.3 percent.

40.23(2)(c) (c) The amount, if any, which can be provided by accumulated employee and employer additional contributions credited to the participant’s account.

40.23(2)(d) (d) If the annuity effective date is prior to the normal retirement date of the participant, the annuity amount computed under par. (b) shall be reduced, as recommended by the actuary and approved by the board, by a percentage or percentages of the amount of the annuity for each month and any major portion of a month between the effective date of the annuity and the participant’s normal retirement date.

40.23(2)(e) (e) The amount of the annuity computed under par. (b) shall be reduced by the amounts, determined under s. 42.244 (4) (b) and (c), 1979 stats., s. 42.246 (1) (e), 1979 stats., s. 42.77 (3) (b) and (c), 1979 stats., and s. 42.79 (1) (e), 1979 stats., for those teacher participants specified in those sections.

40.23(2m) (2m) The following provisions apply only to participants who are participating employees after March 9, 1984:

40.23(2m)(a) (a) The retirement annuity in the normal form is a straight life annuity payable for the life of the annuitant.

40.23(2m)(b) (b) Except as provided in s. 40.26, subject to the limitations under section 415 of the Internal Revenue Code, the initial amount of the normal form annuity shall be an amount equal to 70 percent, or 65 percent for participants whose formula rate is determined under par. (e) 3. or 85 percent for participants whose formula rate is determined under par. (e) 4., of the participant’s final average earnings plus the amount which can be provided under pars. (c) and (d) or, if less, shall be in the monthly amount equal to the sum of the amounts determined under pars. (c), (d) and (e) as modified by par. (f) and in accordance with the actuarial tables in effect on the annuity effective date. If the participant has creditable service under both par. (e) 4. and another category under par. (e), the percent applied under this paragraph shall be determined by multiplying the percent that each type of creditable service is of the participant’s total creditable service by 85 percent and 65 percent or 70 percent, respectively, and adding the results, except that the resulting benefit may not be less than the amount of the normal form annuity that could be paid based solely on the creditable service under par. (e) 4.

40.23(2m)(c) (c) The annuity which can be provided from a sum equal to 200 percent of the excess accruing after June 30, 1966, for teacher participants, or December 31, 1965, for all other participants, of the participant’s required contribution accumulation reserved for a variable annuity over the amount to which the contributions would have accumulated at the core annuity division effective rate if not so reserved. If the participant’s required contribution accumulation reserved for a variable annuity is less than the amount to which the contributions would have accumulated at the core annuity division effective rate if not reserved, the annuity shall be reduced by the amount which could be provided by a sum equal to 200 percent of the deficiency.

40.23(2m)(d) (d) The amount, if any, which can be provided by accumulated employee and employer additional contributions credited to the participant’s account.

40.23(2m)(e) (e) A monthly annuity in the normal form computed on the basis of the participant’s final average earnings and creditable service, if the annuity becomes effective on or after the normal retirement date of the participant, determined by multiplying the participant’s final average earnings by the participant’s creditable service and the following applicable percentage:

40.23(2m)(e)1. 1. For each participant for creditable service of a type not otherwise specified in this paragraph that is performed before January 1, 2000, 1.765 percent; for such creditable service that is performed on or after January 1, 2000, 1.6 percent.

40.23(2m)(e)2. 2. For each participant for creditable service as an elected official or as an executive participating employee that is performed before January 1, 2000, 2.165 percent; for such creditable service that is performed on or after January 1, 2000, but before June 29, 2011, 2 percent; and for such creditable service that is performed on or after June 29, 2011, 1.6 percent.

40.23(2m)(e)3. 3. For each participant subject to titles II and XVIII of the federal Social Security Act, for service as a protective occupation participant that is performed before January 1, 2000, 2.165 percent; for such creditable service that is performed on or after January 1, 2000, 2 percent.

40.23(2m)(e)4. 4. For each participant not subject to titles II and XVIII of the federal Social Security Act, for service as a protective occupation participant that is performed before January 1, 2000, 2.665 percent; for such creditable service that is performed on or after January 1, 2000, 2.5 percent.

40.23(2m)(em) (em)

40.23(2m)(em)1. 1. For the purpose of determining the applicable percentage rate under par. (e), all of the following shall apply:

40.23(2m)(em)1.a. a. Any creditable service forfeited by a participating employee before January 1, 2000, and which is subsequently reestablished by the participating employee under s. 40.285 (2) (a), shall be considered to have been performed before January 1, 2000.

40.23(2m)(em)1.b. b. Any creditable service received under s. 40.285 (2) (b), which is based on service performed before January 1, 2000, shall be considered to have been performed before January 1, 2000.

40.23(2m)(em)1.c. c. Any creditable military service received under s. 40.02 (15) (c), which is based on creditable service performed before January 1, 2000, shall be considered to have been performed before January 1, 2000.