MGEC received the Early Retirement Incentive (ERI) MOU from MMB on December 1st, 2020. MGEC has a process that allows our Executive Committee to approve modifications to the contract when additional benefits are provided, and no harm is done to anyone. This approval was completed by the Executive Committee on December 1st, 2020. We provided MMB with the signed MOU on December 2nd, 2020.
MMB will submit the ERI to the legislature’s Subcommittee on Employee Relations (SER).
The employer (MMB or the agencies) will inform employees of the ERI once it is approved by the SER or if thirty days have passed and the SER has not rejected it (around January 4, 2021).
Agencies will decide if they want to offer the ERI to their employees. Agency decisions are not known to us yet. The decision to offer employees an ERI was originally done during a time when the state was expecting a significant budget deficit this fiscal year. Now they are expecting a small surplus this fiscal year but a deficit the following year.
The value of the ERI is different for each individual. Variables that may impact the value of the ERI to each individual:
Years of service
Single or family insurance coverage
Time until retirement
Employees must consider if the benefit they may receive under the ERI will offset their retirement benefit should they choose to retire early. An employee can take the ERI, terminate employment with the State of Minnesota and hold off on taking retirement benefits. Historically, the additional years of age at the time of taking retirement benefits resulted in higher benefits. Employees considering this should talk with MSRS for detailed information.
The employer doesn’t have to offer the ERI to everyone. An employee who has already announced his/her intention to retire may be denied the ERI.
Use of the ERI can provide remaining employees with opportunities to gain experience in new positions by working out of class. Employees with specific interest in doing so should take initiative to share that interest with their supervisor.
If you have any questions, please reach out to MGEC.