§ 399 — Special annuity and custodial account programs authorized

New York § 399

• Jurisdiction: New York
• Law EDN: Education
• Title 1: General Provisions Article 1 Short Title and Definitions (§§
• Art. 8-C: Special Annuity

Text

§ 399. Special annuity and custodial account programs authorized. 1.\nAn employer is hereby authorized to establish by resolution special\nannuity and custodial account programs which shall provide for the\npurchase of contracts or establishment of custodial accounts providing\nretirement and death benefits for or on behalf of employees electing to\nenter into an agreement with such employer providing for a reduction of\nannual salary for the purpose of purchasing such contracts or for making\ncontributions to such custodial accounts.\n 2. Where the employer has established a special annuity and/or\ncustodial account program authorized by this article, any employee may\nenter into an agreement with his employer for the reduction of his\nsalary which is earned after the effective date of such agreement and\nfor contributions to the purchase of an annuity contract or to a\ncustodial account for such employee by his employer in an amount equal\nto the reduction in salary so agreed on. The employer shall purchase the\nannuity contract or make contributions to the custodial account for such\nemployee entering into such an agreement from the insurer or custodian\ndesignated pursuant to subdivision four of this section. Such annuity\ncontract shall be issued to, and become the property of, such employee\nwhose rights therein shall be non-forfeitable except for failure to pay\nfuture premiums or such custodial account shall be established on behalf\nof such employee whose rights therein are non-forfeitable. Neither the\nstate, or a political subdivision thereof, nor an employer shall be a\nparty to any annuity contract purchased or custodial account established\nin whole or in part with payments pursuant to said agreement, and no\nretirement, death or other benefit shall be payable by the state, or\npolitical subdivision thereof, or by an employer under such agreement or\nsuch annuity contract or custodial account.\n 3. Subject to approval and filing, as hereinafter provided by the\ncomptroller, any such agreement shall specify the amount of such\nreduction, and the effective date thereof, and shall be binding and\nirrevocable as to both parties thereto during the continuation of such\nemployee's employment with the employer; provided, however, that such\nagreement may be terminated in accordance with university guidelines\nupon notice in writing by either party. Such termination shall take\neffect at the beginning of the payroll period the first day of which is\nnearest to the thirtieth day following the day on which such\nnotification of termination was (i) received by the employer, in the\nevent such termination is initiated by the employee, or (ii) sent to the\nemployee in the event such termination is initiated by the employer.\n 4. The board of trustees of state university with respect to the state\nuniversity and the community colleges, and the board of trustees of the\ncity university with respect to employees of the city university of New\nYork, shall designate the insurer or insurers from which such annuity\ncontracts or in the case of custodial accounts, the company or companies\nfrom whom regulated investment company shares shall be purchased. In\nmaking such designation, due consideration shall be given to (a) the\nnature and extent of the rights and benefits to be provided by contracts\nfor such special annuity or custodial account for employees and their\nbeneficiaries, (b) the relation of such rights and benefits to the\namount of contributions to be made for such contracts, (c) the\nsuitability of such rights and benefits to the needs and interests of\nemployees, and to the interests of employers in the employment and\nretention of employees, and (d) the authority and ability of the\ndesignated insurer or insurers or designated company or companies to\nprovide rights and benefits under such contracts or custodial accounts.\n 5. The board of trustees of state university, with respect to the\nstate university and the community colleges, and the board of trustees\nof the city of New York with respect to the city university, are hereby\nauthorized to provide for the administration of a program for the\npurchase of such special annuities or establishment of custodial\naccounts, and to perform or authorize the performance of such functions\nas may be necessary for such purpose in accordance with this section.\n 6. No agreement for reduction of salary as authorized by this section\nor any termination thereof shall become effective until approved by and\nfiled with the comptroller. Upon such approval and filing the\ncomptroller shall reduce an employee's salary pursuant to said agreement\nand pay an amount equal to the amount agreed upon for such salary\nreduction as an employer contribution to the designated insurer or\ninsurers or designated custodian or custodians. Notwithstanding the\nreductions of salary authorized by this article, (i) the amount of\nemployer and employee contributions otherwise required on behalf of an\nemployee electing the optional retirement program pursuant to articles\neight-B or one hundred twenty-five-A of this chapter, as the case may\nbe, shall continue to be made on the basis of the salary of such\nemployee without regard to such reduction, or (ii) in the event a member\nof a public retirement system in this state agrees to a reduction of his\nsalary in accordance with this subdivision, such agreement shall not\ncause him to lose any benefits under such public retirement system to\nwhich he would be otherwise entitled had he not agreed to reduce his\nsalary for the purpose of having a special annuity purchased or\ncontributions to a custodial account made on his behalf, and any\nrequired employer and employee contributions shall continue to be made\non the basis of the salary of such employee without regard to such\nreduction. Any survivor's benefit payable pursuant to the civil service\nlaw shall be based upon the salary of such employee without regard to\nthe reduction authorized by this article.\n 7. Any payroll deduction, other than income tax withholdings as\nrequired by law, which may be required or authorized pursuant to law,\ncontract, agreement, or any other instrument, the amount of which is\ndetermined in relation to an employee's earnings, shall be based on the\nsalary of such employee without regard to reduction thereof pursuant to\nany agreement authorized by this article.\n 8. An employee agreeing to have his salary reduced in accordance with\nthis article shall be paid an amount equal to his salary less the amount\nof the reduction pursuant to such agreement and any deductions\nauthorized by law, such amount to be paid in equal installments in\naccordance with the payroll procedure otherwise appropriate.\n 9. Payments for contracts providing for a special annuity or custodial\naccount shall be made by the comptroller to the designated insurer or\ninsurers or designated custodians out of moneys otherwise available in\naccordance with law for salaries of the employees for whom such\nannuities are purchased or contributions to such custodial accounts are\nmade.\n 10. Nothing contained in this section shall impair or prevent any\nagreements which have heretofore, or may hereafter be, entered into\nbetween Alfred university and any employee of the state college of\nceramics under the management and control of Alfred university as the\nrepresentative of the state university trustees, or between Cornell\nuniversity and any employee of the state colleges of agriculture, home\neconomics, veterinary medicine or industrial and labor relations, the\nstate agricultural experiment station at Geneva, or any other\ninstitution or agency under the management and control of Cornell\nuniversity as representative of the state university trustees for\nreduction of the basic annual salary of any such employee as otherwise\nfixed by or pursuant to law and purchase of a special annuity or\ncontribution to a custodial account on his behalf. In the case of any\nsuch employee whose salary is paid directly to him by the state, the\ncomptroller is hereby authorized to reduce his salary in accordance with\nany such agreement as certified on the appropriate payroll and upon the\naudit and warrant of the comptroller the amount of any such reduction\nshall be paid to Alfred university or Cornell university, as the case\nmay be, out of moneys appropriated and otherwise available for the\npayment of such employee's salary, for the purchase by such university\nof a special annuity or contribution to a custodial account for such\nemployee. No agreement for reduction of salary and purchase of a special\nannuity or contribution to a custodial account by any employee to whom\nthis subdivision is applicable shall cause him to lose any benefits to\nwhich he would otherwise be entitled by reason of membership in the New\nYork state and local employees' retirement system and any required\nemployer and employee contributions to such system shall continue to be\nmade on the basis of the salary of such employee without regard to such\nreduction. In the case of any such employee electing the optional\nretirement program the amount of employer and employee contributions\notherwise required shall continue to be made on the basis of the salary\nof such employee without regard to such reduction. Any survivor's\nbenefit payable pursuant to the civil service law shall be based on the\nsalary of any employee to whom this subdivision is applicable without\nregard to his agreement for reduction thereof. Subdivisions seven and\neight of this section shall apply to employees to whom this subdivision\nis applicable who enter into agreements for reduction of salary and\npurchase of special annuities or contribution to a custodial account.\n