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2000 SESSION
008675548Be it enacted by the General Assembly of Virginia:
1. That § 51.1-144 of the Code of Virginia is amended and reenacted as follows:
§ 51.1-144. Member contributions.
A. Each member shall contribute five percent of his creditable compensation for each pay period for which he receives compensation, and such contribution shall be paid by the member's employer and not charged to the member. Such payments shall be credited to the member's contribution account. These contributions shall not be considered wages for purposes of Chapter 7 (§ 51.1-700 et seq.) of this title, nor shall they be considered salary for purposes of this chapter.
The employer shall deduct the contribution payable by the member. Every
employee accepting employment shall be deemed to consent and agree to any deductions
from his compensation required by this chapter. No deduction shall be taken from the
compensation of a member after his normal retirement date if the member elects
not to contribute.
B. In determining the creditable compensation of a member in a payroll period, the Board may consider the rate of compensation payable to the member on the date of entry or removal of his name from the payroll as having been received throughout the month if service for the month is creditable. If service for the month is not creditable, the Board may consider any compensation payable during the month as not being creditable compensation.
C. The minimum compensation provided by law for any member shall be reduced by
the deduction required by this section. Except for any benefits provided by this
chapter, payment of compensation minus the deductions shall be a full and complete
discharge of all claims for services rendered by the member during the period
covered by the payment.
D. No deduction shall be made from any member's compensation if the employer's
contribution is in default.
EC. The Board may modify the method of collecting the contributions of members
so that the employer may retain the such amounts deducted from members'
salaries and have a corresponding amount deducted from state funds otherwise
payable to the employer.
F. Any employer may elect to pay an equivalent amount in lieu of all member
contributions required of its employees. Such payments shall be credited to the
members' contribution account. These contributions shall not be considered
wages for purposes of Chapter 7 (§ 51.1-700 et seq.) of this title, nor shall
they be considered to be salary for purposes of this chapter.
G. Any employer whose employees are paying member contributions to the
retirement system on a salary reduction basis in accordance with § 414 (h) of
the Internal Revenue Code may pay a portion of the member contributions on
behalf of all of its employees upon notification to the Board of the employer's
intent to make such partial payment. Any employer paying a portion of the
member contributions for its employees (i) shall do so in such manner that the
entire member contribution for all of its employees shall be paid by the
employer starting not later than three years from the commencement of such
partial payment and (ii) shall not pay a portion of the member contribution in
any incremental amount with a fractional part of less than one-half of one
percent of creditable compensation.
H. Any employer that, by resolution of its governing body, elects to provide
retirement coverage for its employees in accordance with § 51.1-130 on or after
September 1, 1998, shall allow its employees to pay member contributions to the
Retirement System on a salary reduction basis in accordance with § 414 (h) of
the Internal Revenue Code in lieu of paying the member contribution on behalf of its
employees in accordance with the provisions of subsection F.