Effective July 1, 2024, an individual who retired on or before December 31, 2023 (January 1, 2024 retirees are ineligible) and has not been employed or retained as an independent contractor by the employer from which the member retired for 90 consecutive days can return to certain public safety related positions for up to 36 consecutive months. The subsequent employment must begin no earlier than July 1, 2024, and no later than June 30, 2027. The retiree’s pension, including any cost-of-living adjustment (COLA) shall continue to be paid for up to 36 consecutive months. The retiree shall not become a member and shall not accrue service credit. The retiree (and affiliated employer) are required to make non-refundable contributions. The retiree shall have no seniority based on pre-retirement employment. If the retiree remains employed beyond 36 consecutive months, the retirees pension will be suspended beginning in month 37 until all PERA-related employment ends.

Retirees who were re-employed before July 1, 2010, were grandfathered in under the laws in place when they were re-employed. Re-employed retirees will continue to receive both a pension and a salary. These re-employed retirees will remain grandfathered in for as long as they continue working for the employer who hired them without a break in service. If you terminate employment you will lose "grandfathered" status. If you begin working again you must suspend your pension. Additionally, re-employed retirees and their employer are required to make contributions during re-employment and these contributions are not refundable to the member.

Effective July 1, 2010, the pension of a retiree who returns to work for a PERA affiliate is suspended. No longer can a retired member collect both a salary and their retirement benefit. If a retired member decides to return to work for a PERA affiliate they have the following options:

PERA retirees who become employed with an NMERB related employer will not be required to pay NMERB contributions nor will they accrue service. PERA retirees are also eligible to receive a COLA while employed with a NMERB employer. PERA retirees do have the option to suspend their PERA pension benefit and becoming a contributing member of NMERB. This action would allow the PERA member to accrue service credit tied to the employee contributions being withheld during employment, however the member is not eligible to draw a pension at the same time he/she is accruing service credit and TIER statuses are nontransferable. PERA retirees considering suspending pension benefits should contact NMERB for additional information about possible benefits and applicable conditions relating to potential future employment. As a reminder, members retire from the last system (PERA or NMERB) the member is employed with, which may subject the member to different retirement eligibility requirements. If the PERA retiree does not suspend his/her pension, the member will not accrue NMERB service credit.

The only retired members who are exempt, or excluded, from the return-to-work provisions are:

There are no limits on the amount of time you may work for an employer not affiliated with PERA. No contributions are due, and your monthly benefit will not be affected.

Retirees may provide services to a PERA-covered employer as an independent contractor. A professional services agreement or contract must be submitted to PERA’s Legal Division at least 15 working days before the effective date of the contract. PERA evaluates the contract to determine whether you are an “employee” or an “independent contractor.” PERA utilizes the common law control test in the Social Security Handbook to determine your status. In this evaluation, PERA considers whether or not the work you are contracting to perform is a continuation of a former employment relationship among many other factors.A clear scope of work must be established in a professional services agreement. As an independent contractor, you must have your own state tax identification number and bill the employer directly. Compensation must be stated hourly or by a defined project. Independent contractors are not paid through the employer’s payroll system and do not accrue employee benefits such as annual and sick leave or overtime. The professional services agreement must contain a release that holds the employer harmless of any liability or claims arising from the agreement. Renewals, amendments and modifications to a previously approved post-retirement contact must also be submitted to PERA for evaluation at least 15 working days before the effective date of the renewal, amendment or modification.You will be notified in writing of PERA’s determination of whether you are an employee or an independent contractor. If PERA determines that you are an employee and you disagree with PERA, you have the right to appeal the determination.

For more information regarding working as an independent contractor, please contact the Office of General Counsel at (505) 616-1756.