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In Pennsylvania, the state systems and plans are self administered, and plan benefits may be divided between the participant or member and that person’s spouse. The plans are the Pennsylvania State Employees’ Retirement Systems (SERS), the Pennsylvania Municipal Retirement System (PMRS), and the Public School Employees’ Retirement System (PSERS).
To pay benefits to a divorce spouse, each of these plans requires a Domestic Relations Order based on Pennsylvania law.
Under Pennsylvania law, SERS honors DROs attaching members’ retirement benefits for the equitable distribution of marital assets.
SERS is not subject to the Retirement Equity Act of 1984, the federal law that prescribes the form and content of DROs for private, non-governmental pension plans. The State Employees’ Retirement Code (71 Pa. C.S. §§ 5101 through 5956) specifies the requirements for approvable DROs affecting “the marital property rights of the spouse or former spouse of a member.” The Retirement Code sets limits on the types of orders SERS may honor, mandating that such orders meet certain requirements to be certified as approved DROs and providing a process for amending approved DROs.
SERS is a defined benefit plan, funded through a combination of employee and employer contributions, as well as investment earnings. The employee contribution rate is set in the Retirement Code. On an annual basis, the SERS Board establishes the employer contribution rate based on a recommendation by its actuary.
DROs affect the distribution of retirement benefits of SERS members after they retire, die or otherwise terminate state service. Payments may be made in accordance with a DRO only after one of those three events occurs.
SERS cannot comply with DROs that conflict with the Retirement Code. Learn more by reading our FAQs below.
A. Depending on the divorce decree, a spouse may be awarded a portion of the pension benefits. The marital portion of the benefit may also be offset by another asset.
A. No. SERS payments are made only when the member spouse ends his or heremployment, or applies for a benefit or refund, and his or her benefits become payable.
A. If the member decides on monthly payments, the former spouse must accept the same payment regime.
A. SERS requires a certified copy of the marriage dissolution or separate order dividing the SERS pension (or a temporary retraining order preventing the application for a refund) before dividing the monthly pension.
A. No. A pension benefit cannot be revoked or changed. For example, if a former spouse is named survivor, payments continue to him or her after the member’s death.
A. Yes. A portion of the pension benefits may be granted as a permanent division of marital property in lieu of liquid assets; therefore, upon the former spouse’s death, payments continue to the estate until the death of the member spouse.
A. An approvable DRO for equitable distribution must specify what portion and in what form SERS pays a member’s retirement benefit to an alternate payee (usually a former spouse) after a divorce. These orders are not effective until approved by SERS. No money can be paid to an alternate payee until the member terminates state service and applied for a refund of contributions or a retirement benefit or dies.
A. In the absence of an appropriate court order, a SERS member may take any action permitted by the Retirement Code, including a change of beneficiary without any notice to or consent from anyone, including a spouse.
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