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Resolution 2016-13, Retirees as Independent Contractors


It is the intent of the Montana Association of Counties to seek legislation eliminating the requirement that employers pay contributions to the Public Employees Retirement System for retirees working as independent contractors.

WHEREAS, HB 105 of the 2013 legislative session instituted a  requirement for employers to pay contributions on retirees in the Public Employees Retirement System working as Independent Contractors; and

WHEREAS, the term “independent contractor” is not defined under pension law; and

WHEREAS, there is no distinction within the retirement law on contribution payments to separate payments on time and/or materials for retirees working as independent contractors; and

WHEREAS, the lack of definition and clarity causes overpayment of employer contributions; and

WHEREAS, employers may have to challenge applicability to obtain clarification and/or refunds; and

WHEREAS, ambiguous applicability causes unnecessary additional employer time and expense;

WHEREAS, there are no additional benefits applied to the retiree for these contributions; and

WHEREAS, MCA §19-3-1106(7)(a), requires employer contributions on work performed by a retiree through a professional employer arrangement, an employee leasing arrangement, or a temporary service contractor.

NOW, THEREFORE BE IT RESOLVED that the Montana Association of Counties will seek legislation to eliminate the requirement that employers pay contributions to the Public Employees Retirement System for retirees working as independent contractors.

2016 ACTION

SPONSOR:  MACo Staff
REFERRED TO: MACo Tax, Finance & Budget Committee
ADOPTED:  Annual Conference, Billings, MT, September 21, 2016