School employers, retired teachers, administrators and other personnel should use caution when entering into emergency contracts for temporary, post-retirement employment. Generally, employers may hire retired teachers, administrators and other personnel under temporary contracts when there is an emergency, or in the event of a shortage of appropriate personnel. However, the Pennsylvania Public School Employees’ Retirement System (“PSERS”) may not accept the determination of the employer that the requisite emergency or shortage exists to justify the contract. In such cases, PSERS may adjust the employee’s retirement benefit and/or require the employee to repay benefits paid during the term of the emergency contract. While the law does not expressly require the employer or the employee to obtain authorization from PSERS before entering into such a contract, doing so may avoid problems for the employer and the employee if PSERS is consulted and pre-approves the emergency contract. The issue of whether PSERS has authority to interfere with the employer’s determination that an emergency or shortage exists is currently on appeal in the Commonwealth Court. For more information about how this issue may impact you, please contact our office.
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