[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.
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.