Guidelines
Membership with this retirement system is automatic for all employees of the City of Northampton, Forbes Library and the Northampton Housing authority, that meet the criteria for eligibility.
Eligibility requires that an employee must have either a full-time or part-time status, at a scheduled minimum of 20 hours per week, and is not considered intermittent, seasonal, provisional or temporary.
Teachers cannot be members of this system and must be enrolled with MTRB (Massachusetts Teachers' Retirement Board).
Groups
Members are categorized into four different groups. As stated in the Massachusetts Public Employee Retirement Guide, these are definied as follows:
- Group 1 members are officials and general employees including clerical, administrative and technical workers, laborers, mechanics, and all others not otherwise classified.
- Group 2 includes certain employees with hazardous occupations, such as ambulance attendants, licensed electricians, and mental health hospital attendants.
- Group 3 is made up of state police officers.
- Group 4 consists of public safety officers, officials, and employees, such as police officers, firefighters, and certain correction officers.
Each group has unique guidelines for benefits. The Northampton Retirement System currently does not have any Group 2 members. Group 3 is not applicable to this system.
Deductions
Retirement deductions are taken on all regular pay, including retro and incentive pay. Deductions are not taken on overtime pay or severance pay (including sick and vacation payouts).
Deduction Rates
Members contribute at one of four deduction rates depending on the date first enrolled with a Massachusetts retirement system:
5%- prior to 1/1/1975
7%- 1/1/1975 - 12/31/1983
8%- 1/1/1984 - 6/30/1996
9%- on or after 7/1/1996
New members that have prior membership can only retain their original deduction rate if they did not refund their accumulated deductions from their prior membership.
An additional 2% incremental deduction is withheld for all employees (with a membership date on or after January 1, 1979) earning $30,000 a year or more. The two percent is taken from salary in excess of $30,000. For example, an employee earning $32,000 a year is subject to an additional 2% deduction on $2,000. The 2% is deducted each pay period by annualizing the salary rate of that pay period.