[HISTORY: Adopted by the Borough Council of the Borough of Eatontown as indicated in article histories. Amendments noted where applicable.]
[Adopted 9-14-2005 by Ord. No. 19-2005]
This article shall be known as the "Borough of Eatontown Accelerated Payment of Sick Time Compensation Plan," referred to throughout the article as the "plan." It shall be effective immediately upon adoption by the Borough Council.
The primary purpose of this article is to permit employees of the Borough to enter into an agreement which will provide for the employee's election to accelerate payment for accumulated sick time compensation until death or retirement, in accordance with the provisions of Section 457 of the Internal Revenue Code and with other provisions of the Code. The plan will be administered by the Borough's deferred compensation vendors, Equitable and ING.
A. 
Any employee who meets the qualifications set forth below may elect to become a participant in the plan and to accelerate payment for accumulated sick time, up to the threshold amounts set forth in each employee's collective bargaining agreement or employment contract regarding terminal payment for accrued sick time, by executing a written participation agreement and filing it with the Borough. For example, if an employee has 200 accumulated sick days and is entitled to receive 100 accumulated sick days at retirement, the employee may make a one-time election of how these days will be paid. The employee would then be able to receive no more than 1/3 of these days in each of the three succeeding calendar years. Thus an employee would be reimbursed for 33 days of sick leave in year one; 33 days in year two; and 34 days in year three. All of these amounts will be paid into the employee's 457 plan.
B. 
The agreement shall declare a retirement age and date, which may at the age or after which the employee qualified for normal retirement date, but no later than age 70 1/2. This declaration does not compel retirement.
Any employee who has completed 22 years or more of pensionable service in any New Jersey State Pension System may elect to take a portion of his/her accumulated sick leave benefit prior to retirement as explained in § 52-3 and accelerate payment for that amount, which shall not exceed the applicable dollar amount as set forth in 457(e)(15) of the Code, as follows:
A. 
The maximum contribution amount for 2005 is $14,000 plus an age 50+ provision of an additional $4,000 (if the employee qualifies) for a total contribution amount of $18,000 for 2005.
B. 
The maximum contribution amount for 2006 is $15,000 plus an age 50+ provision of an additional $5,000 (if the employee qualifies) for a total contribution amount of $20,000 for 2006.
A participating employee may accelerate payment of an additional amount under this provision for one or more of the last three calendar years ending before attaining the participant's normal or deferred retirement date, herein referred to a "preretirement catch-up." The use of preretirement catch-up is subject to the following restrictions:
A. 
The maximum amount a participating employee may accelerate each calendar year for the last three years of employment to the plan shall not exceed twice the regular dollar limit in effect as set forth in the Code. The maximum amount for 2005 is $14,000 x 2, or $28,000, and for 2006 is $15,000 x 2, or $30,000.
B. 
The preretirement three-year catch-up provision may be used only once by any participating employee.
C. 
Participating employees may continue to make regular contributions after they are no longer eligible to use preretirement catch-up.
D. 
"Deferred retirement date" means the date beyond normal retirement date designated by the participating employee.