An Act To Exclude Collectively Bargained Salary and Job Promotion Increases from the Earnable Compensation Limitation for Retirement Purposes
Maine Legislature, Session 129, LD 1620
Committee: Labor and Housing
Sponsors: JACKSON
Amends: 5 MRSA §17001

Legislative Document
No. 1620
S.P. 517
In Senate, April 23, 2019
An Act To Exclude Collectively Bargained Salary and Job 
Promotion Increases from the Earnable Compensation Limitation 
for Retirement Purposes
Reference to the Committee on Labor and Housing suggested and ordered printed.
DAREK M. GRANT
Secretary of the Senate
Presented by President JACKSON of Aroostook.
Be it enacted by the People of the State of Maine as follows:
Sec. 1.  5 MRSA §17001, sub-§13, ¶C, as repealed and replaced by PL 1999, c. 
489, §2, is amended to read:
C.  The following provisions govern limitations on earnable compensation.
(1)  Notwithstanding the other provisions of this subsection, except as provided 
in subparagraph (3), for the purposes of determining average final compensation, 
"earnable compensation" does not include any increase that exceeds the prior 
year's earnable compensation by more than 5% or that results in a total increase 
of more than 10% during the 3-year period used in the calculation of average 
final compensation, unless the cost of the additional actuarial liability arising 
from the excess increase is paid by the employer as provided in section 17154.  
Any payment made under paragraph B, subparagraph (1) must be included in 
determining the amount of increase in the year in which the payment is made.  
This subparagraph does not apply to excess increases resulting from 
compensation paid prior to July 1, 1993, from compensation paid in accordance 
with an individual employment contract executed prior to July 1, 1993 or a 
collective bargaining agreement executed or ratified in its final form by final vote 
of one party to the agreement prior to July 1, 1993 for the initial term of that 
contract or agreement or from other action by the governing body of a school 
administrative unit in effect on July 1, 1993.  This subparagraph does not apply to 
increases in compensation of state employees during fiscal year 1993-94 and 
fiscal year 1994-95.  In all circumstances in which this subparagraph does not 
apply to earnable compensation of state employees and teachers, the provisions 
of this subparagraph that were in effect prior to June 30, 1993 apply.  This 
subparagraph does not apply to earnable compensation of employees of 
participating local districts.
(2)  Effective October 1, 1999, the 5% limitation and the 10% limitation on 
increases in earnable compensation set out in subparagraph (1) may not be 
changed to a lower percentage for members who, on October 1, 1999 or 
thereafter, meet the creditable service requirement for eligibility to receive a 
service retirement benefit, at the applicable age if so required, under section 
17851 or section 17851-A, subsection 2.
(3) Collectively bargained salary or wage increases pursuant to Title 26, chapter 
9-A, 9-B or 12 or job promotion may not be considered in calculating salary or 
wage increases for the purposes of subparagraph (1).
SUMMARY
This bill restores 2 exclusions from the calculation of salary or wage increases for the 
purpose of determining average final compensation under the Maine Public Employees 
Retirement System that were in statute before significant changes were made in 1993.