Pension Eligible Compensation

The Wyoming Retirement System (WRS) has defined what constitutes pension eligible compensation. WRS will review contributions and employee compensation to ensure compliance with applicable law and regulation.

WRS cannot accept retirement contributions on nonrecurring payments to employees. Nonrecurring payments are considered equivalent to bonuses paid in addition to base salary and have the potential to "spike" retirement benefits without providing the consistent funding necessary to pay future benefits.

Below is a chart describing the most common pay type’s employer’s encounter and whether the pay is pension eligible?

Pay Type	Description/Examples	Pension Eligible	Explanation
Bonuses	Financial compensation above and beyond the normal payment expectations of the recipient.	No
Cell Phone	Cell phone reimbursement stipends: a sum of money given to employees to purchase a cell phone or a cell phone plan.	No
Comp Time  Compensatory Time	Paid time off given to an employee instead of overtime pay in compensation for extra hours of work.	Yes	If used in the calendar year earned.
Disability Benefits  Disability Insurance	Disability insurance: replaces a certain percentage of an employee’s gross monthly income.	No
Early Retirement Incentive Pay (ERIP)	Pay intended as incentive for employees approaching or at retirement age to retire earlier than they might have otherwise.	No
Extra Duty Payments	An allowance payable to employees who are given special assignments or perform additional duties.   Examples: coaching, summer school, activity bus driving, etc.	Yes
Fringe Benefits	An extra benefit supplementing an employee's salary. Examples: company car, subsidized meals, health insurance, etc.	No
Housing Allowances	Reimbursement to an employee for basic living expenses.	No
Medical Insurance (paid by the employer)	Employer paid health insurance premiums.	No
National Board Certification (NBC)	NBC is a voluntary, advanced teaching credential that goes beyond state licensure.	Yes	If paid in the calendar year earned.
On-Call Pay	Pay issued to an employee while on-call.	Yes
Retroactive Compensation	Examples: court orders, arbitration awards, grievance settlements. Etc.	Yes
Service Rendered Pay	Pay earned by an employee for service rendered.	Yes
Severance Pay	Lump sum payment to an employee upon dismissal or discharge from employment.	No
Transportation Expenses	Specific reimbursement for the cost of business transportation by car, plane, train, etc.  Examples: vehicle expenses, fuel, mileage, parking fees, lodging, meals or telephone charges.	No
Unused Leave	Lump sum payout of unused time. Examples: lump sum payout at the end of employment for unused sick, annual, or admin leave.	No
Used Leave	Pay for use of accrued paid time off.  Examples: administrative, sabbatical, annual, sick, vacation, or personal leave;	Yes
Workers Compensation (non-State Agency)	Benefits to an employee who suffers a work-related injury or illness. Helps pay for medical care, wages from lost work, etc.	No
Workers Compensation (State Agency)	Benefits to an employee who suffers a work-related injury or illness.	Yes	Up to six months per Wyo. Stat. 9-2-1022(g).

• Payments received by an employee in lieu of previously employer-provided fringe benefits under an agreement between the employee and participating employer entered into within sixty (60) months before retirement, or any other payment which may reasonably be construed to be a fringe benefit are not pension eligible.
• Any payment made during any three-year period of employment which is deemed to increase highest average salary for the primary purpose of increasing a retirement benefit is not pension eligible.
• Nonrecurring lump sum payments to employees who have reached the highest level of pay in their pay grade (i.e. “red lined”) are not pension eligible

Pay Type	Description/Examples	Pension  Eligible	Eligibility Reason
Hazard Pay	Additional pay for performing hazardous duty or work involving physical hardship (as defined by the Fair Labor Standards Act – FSLA).	Yes	This pay is reoccurring in nature and is usually required to be included in the employee’s rate of pay.
Hazard Pay	Bonus compensation or reimbursement for hazard pay not used.	No	This pay is nonrecurring and is usually related to pandemic circumstances and not the job itself.
Families First Coronavirus Act - COVID 19 paid sick leave	Compensation at employee's rate of pay for time not worked pursuant to Federal Guidelines.	Yes	This pay type is consistent with employee earned sick leave.
Families First Coronavirus Act - COVID 19 paid expanded family and medical leave	Payment not related to employee's rate of pay for reimbursement, severance pay, hazard or medical expenses, bonus, etc.	No	This type of pay is consistent with nonrecurring payments (fringe benefits and reimbursements) and is not eligible compensation.