Reduction-In-Force Guide to Benefits

One of the first concerns you will have when you have been notified of Reduction in Force will be your benefits. There are many benefits associated with a reduction in force. You should arrange to discuss the variety of benefits for which you may be eligible with someone in your HR office. The information listed below should answer many of your questions. If you have specific questions regarding issues not addressed below, make sure you discuss these issues with your agency Health Benefits Representative.

Individual/Health Coverage

One of the first concerns you will have when you have been notified of Reduction in Force will be your benefits. There are many benefits associated with a reduction in force. You should arrange to discuss the variety of benefits for which you may be eligible with someone in your HR office. The information listed below should answer many of your questions. If you have specific questions regarding issues not addressed below, make sure you discuss these issues with your agency Health Benefits Representative.

Health Coverage

State Health Plan website

If you have 12 months of service in a position subject to the State Human Resources Act and are a participating member of the health plan at the time of separation because of reduction in force, the State of North Carolina will pay the employer portion of your health coverage for up to twelve months following your separation. After this, you may continue coverage on a fully contributory basis for as long as you desire. If you have dependent coverage, it also may be continued on a fully contributory basis.

Employees who elect not to continue coverage under reduction-in-force priority directly after separation may not obtain coverage at a later date. Eligibility for coverage under RIF priority ends when employees are re-employed by the State and are eligible for coverage on a partially contributory basis. If employees do not have 12 months of consecutive service, health coverage may be continued for employee and eligible dependents under the State Health Plan’s COBRA provisions. Information regarding continuation rights under COBRA will be mailed to the RIFed employee’s home address directly from the State Health Plan once the employer-provided health coverage ends.

Annual Leave

If you are separated as a result of reduction-in-force, you will be paid for the vacation leave you have accumulated up to a maximum of 240 hours.  You will receive your check on the earliest payroll possible following your separation.  For specific information on when you will receive your payment for accumulated vacation leave, see your Health Benefits Representative.

Bonus Leave

Bonus leave balance will be paid in addition to regular annual leave if you leave state government as a result of reduction-in-force.  You will receive your check on the earliest payroll possible following your separation.  For specific information on when you will receive your payment for accumulated bonus leave, see your Health Benefits Representative.

Sick Leave

You cannot be paid for accumulated sick leave if you are separated.  However, if you return to state employment within five years from your separation date, it will be reinstated.  If you transfer to another agency or department, your sick leave transfers with you.

Longevity

If you are eligible to receive longevity pay and are separated from state government, you will receive a prorated amount on the earliest payroll possible following the date of your separation.  If you are transferred to another agency or department, you will receive longevity on your regularly scheduled eligibility date.

Payroll deductions

If you are enrolled in any group life, accident, disability income, or cancer coverage insurance plans paid through payroll deduction, you will need to contact the company that provides the service. 

NCFlex

The American Recovery and Reinvestment Act (ARRA) provided a COBRA premium reduction for eligible individuals who were involuntarily terminated from employment through the end of May 2010. Due to the statutory sunset, the COBRA premium reduction under ARRA is not available for individuals who experience involuntary terminations after May 31, 2010. However, individuals who qualified on or before May 31, 2010 may continue to pay reduced premiums for up to 15 months, as long as they are not eligible for another group health plan or Medicare.

Retirement

Service Retirement (Unreduced Benefits)

You may retire with unreduced service retirement benefits after:

  • you reach age 65 and complete five years of creditable service, or
  • you reach age 60 and complete 25 years of creditable service, or
  • you complete 30 years of creditable service, at any age.

Early Retirement (Reduced Benefits)

You may retire early with a reduced benefit after:

  • you reach age 50 and complete 20 years of creditable service, or
  • you reach age 60 and complete five years of creditable service.

Your early retirement benefit is determined by the same formula as a service retirement.  However, because benefits may be paid over a longer period of time, they will be reduced.  The amount of reduction depends on your age at retirement.

Discontinued Service Retirement

Discontinued Service Retirement Statute

Contingent on approval by the State Budget Officer and the Director of the Office of State Human Resources, state employees who are 55 years of age and have 20 years of creditable service, and who are separated due to a RIF, may be eligible for full retirement without a reduction in benefits as an alternative to severance pay.  This is referred to as “discontinued service retirement”.  You may also be eligible for reduced retirement benefits if you are 50 years of age and have 20 years of creditable service.  Approval of this option depends primarily on the financial ability of the State of North Carolina to fund discontinued service retirement. You may receive either a discontinued service retirement or severance salary continuation.  You cannot receive both.

Deferred Retirement

You may still receive a retirement benefit, even if you leave early or before service retirement.  You are entitled to a benefit at a later date if you leave for any reason at any age after you have completed five years of creditable service, provided you do not withdraw your contributions.

Your benefit is determined by the formula in effect at the effective date of your retirement.  It is based on your average final compensation and years of creditable service.  You can apply for deferred payments to begin when you reach age 60.

If you have at least 20 years of creditable service when you leave, you can apply for early payments beginning at age 50.  However, your benefit is reduced because you may receive payments for a longer period of time.

If you leave the State of North Carolina before you have five years of creditable service in the retirement system, the only payment you will receive is a refund of your contributions.

Refund of Retirement Contributions

If you have five years of member service, you have the option of leaving your contributions in the retirement system and maintaining all of the creditable service you have as of the date of separation.  Please note that if you elect to leave your contributions in the retirement system, and you have made contributions for at least five years, you are entitled to retirement benefits at a later date.

If you leave state employment, you also have the option to receive a refund of your contributions to the retirement system.  It is important to note that if you have your contributions refunded and are re-employed by the State at a later date, you have to contribute five years to the retirement system before you are eligible to buy back your prior state service.  Buying back prior state service can be expensive.  If you have at least five years as a contributing member, interest will be added to your refund.  Your refund application will be forwarded to the retirement system once your Health Benefits Representative has processed your final pay information for time worked and accumulated vacation leave.  State law does not permit the retirement system to make refunds earlier than 60 days after your application is received.  Your HR office can provide you with a refund application.

If you transfer to an agency under the Local Government Employees’ Retirement System, you can transfer your contributions and creditable service as long as you are an eligible member of the system to which you are transferring and have not received a refund of your contributions from the Teachers’ and State Employees’ Retirement System.  Your HR office can provide you with a transfer application.  If you transfer to another state agency, your retirement number will remain the same, and you have no option of withdrawal.

ORBIT

Orbit

This is the link to your Online Retirement Benefits through Integrated Technology website with the N.C. Teachers’ and State Employees’ Retirement System.

Severance Salary Continuation

Contingent on approval by the Office of State Budget and Management, you may be eligible for severance salary continuation if you are separated and there is a savings to the economies of the state and there is no foreseeable opportunity for reemployment.  Should you be eligible for retirement and apply for retirement before separation, you would not be entitled to severance pay.

Unemployment Benefits

Division of Employment Security

Employees separated due to Reduction in Force may collect unemployment insurance provided they meet the normal eligibility requirements. Contact the Division of Employment Security (DES) for more information. The customer call center phone number for DES is 888-737-0259. 

 

BEACON Employee Self-Service (ESS)

Beacon Self-Service Portal

The BEACON portal provides you with the tools you need to better access and manage your state benefits and personal information. For additional support information, visit the BEST (BEACON Enterprise Support Team) Shared Services website at www.osc.nc.gov/best.  If you need assistance while using the site, please call the BEST Shared Services Center from 8 a.m. to 5:00 p.m., Monday through Friday, at 707-0707 if local to Raleigh or 1-866-NCBEST4(U) (1-866-622-3784) outside the Raleigh area.

Workers' Compensation

Vacation/Sick Leave

While on workers’ compensation leave you will continue to accumulate vacation and sick leave to be credited to your account for use upon return to work.  If you do not return to work, vacation and sick leave accumulated during the first twelve months of workers’ compensation leave will be paid in a lump sum along with other unused vacation/bonus credit which was earned prior to the injury.

Hospitalization Insurance  

While on workers’ compensation leave, you are in pay status and will continue coverage under the State’s health insurance program. The State will pay the portion of the monthly premium covered under the State Health Plan.  Premiums for any dependent coverage must be paid directly by you.

Performance Increases

Upon reinstatement, your salary will be computed based on the last salary plus any legislative increases to which you are entitled.  Any performance increases which would have been given had you been at work may also be included in the reinstatement salary, or it may be given on any payment date following reinstatement.

Longevity  

While in workers’ compensation leave status you continue to receive longevity credit and, if eligible, shall receive annual payments.

Retirement Service Credit  

While on workers’ compensation leave you do not receive retirement service credits.  As a member of the Retirement System, you may purchase credits for the period of time out on an approved leave of absence.  Upon your request the Retirement System will provide a statement of the cost and a date by which purchase must be made.