SERVICE EMPLOYEES INTERNATIONAL UNION LOCAL 721 (SEIU) - FULL-TIME (2019-2022)

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applicable to any employee shall be changed or deemed to have been changed by reason thereof. As a result, the City will not treat these payments as ordinary income and, thus will not withhold Federal or State income tax from said payments. The City has received an opinion or ruling from the Internal Revenue Service (IRS) confirming that these payments are deferred compensation, not ordinary income. 2. "New" Members As required by PEPRA, the City shall participate in equal cost sharing by paying fifty percent (50"/0) of the normal cost, as established by CalPERS in its annual valuation report. B. Employee Contributions 1. "Classic" Members The employee contribution rate shall be eight percent (8.0%) of compensation earneble. All employee contributions are paid towards the employer portion of the City's CalPERS contribution. This payment shall be paid in accordance with Government Code §20516(f) as cost sharing. 2. "New" Members As required by PEPRA, the employee contribution rate shall be fifty percent (50%) of the normal cost, as rounded to the nearest quarter of a percent by CalPERS in its annual valuation. C. Pre -Taxable Benefit To the extent permitted by CalPERS and IRS regulations, the City shall make any employee contributions as a pre-tax deduction. 12.3 CalPERS Benefit Options The City contracts with CalPERS to provide the following additional optional benefits: A. Credit for Unused Sick Leave (Govemment Code &20965) Upon retirement, an employee may have accumulated, but unused, sick leave converted to additional service credit at the rate of 0.004 years of service credit for every eight (8) hours of unused sick leave up to a maximum of sixteen hundred (1600) hours. The City must report only those days of unused sick leave that were accrued by the employee during the normal course of employment. This section applies to 2019-2022 MOU City of Santa Ana & SEIU Full -Time Employees Unit Page 71 �(\ �V`