The formula used to calculate a NYSLRS pension varies by tier and plan, but your credited service and final average earnings (FAE) are the main factors. You earn service credit for paid service with participating employers, and you also may purchase credit for previous public employment. Your FAE is the average wage you earned during the period when your earnings were highest (36 consecutive months for Tier 5 and 60 consecutive months for Tier 6).
Your FAE can include overtime pay you earn during that period, but for Tier 5 and 6 members there are limits to how much overtime can be used to calculate your pension.
You can still earn overtime pay beyond the limit — it just won’t be used in your FAE. Members also aren’t required to make contributions on overtime pay that is above the limit.
Tier 5 Overtime Limits
The overtime limit for Tier 5 Employees’ Retirement System (ERS) members increases each calendar year by 3 percent. In 2022, the limit for Tier 5 ERS members is $21,386.41.
For Tier 5 Police and Fire Retirement System (PFRS) members, the overtime limit is 15 percent of your regular earnings each calendar year.
Tier 6 Overtime Limits
The overtime limit for Tier 6 ERS members increases each calendar year based on the annual increase of the Consumer Price Index (CPI). In 2022, the limit for Tier 6 ERS members is $18,233.
For Tier 6 PFRS members, the overtime limit is 15 percent of your regular earnings each calendar year.
Learn More
Find more information about the overtime limit, FAE and retirement calculations in your retirement plan booklet, available on our Publications page.
I’m in Tier 6 and recently it was posted that the vesting for Tier 5 and 6 was changed from 10 years to 5 years but I can’t seem to find any information on that change on the website.
As of April 9, 2022, Tier 5 and 6 members only need five years of service credit to be vested. You can find more information on our Are You Vested? page and our blog post, Becoming Vested.
I’m in tier 6 police and fire. I get paid for 13 holidays a year and receive longevity payments starting at 7 years of service thru retirement. Are longevity and holiday pay considered part of my base salary or is it part of the 15% cap (overtime).
Generally, holiday pay and longevity payments would be pensionable. For account-specific information about your particular retirement plan, please email our customer service representatives using our secure email form. Filling out the secure form allows them to safely contact you about your personal account information.
Will there be an incentive this year?
The New York State Legislature (not NYSLRS) occasionally enacts statewide retirement incentive programs, which must be approved by both houses and then signed into law by the Governor. The Retirement System (NYSLRS) administers programs that are signed into law.
If a State retirement incentive program is approved by both houses of the Legislature and signed into law by the Governor, NYSLRS will notify your employer and provide details for our members on our website and on social media.
When will an updated Tier 6 Overtime Limit be provided for the 2019 calendar year?
The 2019 calendar year limit should be available early in 2019.
We recommend keeping an eye on this blog, NYSLRS social media feeds and our Overtime Limits for Tier 6 web page for an announcement when the 2019 limit is released.
I’ve see that there are overtime limits when conducting Retirement calculations for Tier 5 and Tier 6. Might I presume that there are no overtime limits for Tier 4 members when calculating retirement benefits? Was the OT limits changed recently for Tier 4 members?
The calculation of a Tier 4 member’s Final Average Salary (FAS) can include overtime earned in the FAS period (36 consecutive months). Please read our Tier 4 plan publication for more information about FAS.