Lump sum payments must be reported in the month they were earned using the appropriate earnings code.
The following types of payments may be made as a lump sum:
- Buy back
- Settlement agreement*
- Holiday
- Maintenance (clothing, housing, automobile)
- Noncompensatory overtime**
- Overtime**
- Personal leave
- Pre-shift briefing
- Production bonus
- Retirement bonus/termination pay
- Unused, unpaid sick leave
- Vacation***
- Workers’ compensation
* If an employee receives a settlement, you must submit the settlement agreement or court documents to NYSLRS for review before making any payments or adjustments. If the payment is pensionable, you will then be required to submit the appropriate payments and adjustments.
** For a definition of overtime, visit the Overtime Compensation page. For information about overtime limits for members of Tiers 5 and 6, visit the Overtime Limits page.
*** For members of most tiers and plans, a lump sum payment for up to 30 unused vacation days can be included in the calculation of their pension benefit.
Lump Sum Payments at Separation or Retirement
After you have made final payments to the employee and submitted your monthly report with these final payments, complete the Accrued Payments and Leave Credits page.
We need final payment and service information to:
- Reconcile your employees’ reported earnings.
- Ensure allowable payments are included in their Final Average Earnings (FAE) calculation.
- Determine whether your employees should receive additional service credit for unused, unpaid sick leave.
- Ensure your employees receive an accurate and timely pension benefit.
Rev. 1/26