Employers' Pensions and Benefits Administration Manual (EPBAM)
Winter 2003
   

 

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How to Join One of the
State-administered Retirement Systems
 
and the Role of the Division of Pensions
and Benefits as Administrator of the
State's Social Security Agreement


In order for a new public employer to participate in the public retirement systems administered by the Division, that employer must first be included in the State of New Jersey's agreement with the Social Security Administration.

The following are the required steps that new public employers must take to be included under our agreement, and ultimately to become a participating employer in one of our retirement systems.

  1. The new public entity must submit to the Division a resolution from the governing body stating that the employer will be responsible for the remittance of the employer's share for Social Security coverage. A copy of the statute or ordinance that created or authorized the creation of the entity must accompany the resolution.

  2. The new public entity must provide a statement which includes:
    1. The Employer Identification Number (EIN) from the IRS.
    2. The effective date requested for Social Security coverage (usually the date of the employer's first hire.)
    3. The number of employees to be covered.
    4. The name, address, phone number, fax number and title of the person who will be the Division's contact (usually the certifying officer.)

  3. After the required information is received, the Division executes a formal modification to extend Social Security coverage under Section 218 of the state's Social Security coverage agreement.

  4. The Secretary of Health, Education and Welfare approves the modification. This process may take two or more months.

  5. Once the Division receives notice of the successful modification, a copy of the modification is sent to the contact person. Copies of the modification are also sent to the Enrollment Bureau, the State Health Benefits Bureau and the Publications/Benefits and Employer Education (PBE) Unit of the Client Services Bureau within the Division.

Upon receipt of a copy of the modification, PBE requests a location number to be assigned for each retirement system in which the new employer has enrolled. The Division uses the location number to create and identify the new employer in our data based systems. Most pension documents submitted to the Division by the employer will request this location number. The Division cannot accept or process any forms from the employer, including enrollment applications, until we assign a location number.

With the appropriate location number, PBE can then determine which materials should be included in the new employer package forwarded to the new location. Materials sent may include: the administration manual, member handbooks, enrollment and transfer applications, annual reports, newsletters, fact sheets and other forms needed by employers to provide information to employees and complete their duties in delivering the pension programs.

The package will include information regarding our Employer Education Programs and a cover letter providing the name and phone number of a contact person within the PBE Unit should the employer have any questions or need more information. An important component of the cover letter will be the location number(s). The employer may now use this number to submit enrollment and transfer forms to the Division.

The assignment of a location number(s) and subsequent receipt of an enrollment application(s) will create a master file for the new location in our data based system. This will then generate any enrollment certifications for payroll deductions and the quarterly Report of Contributions (ROC) form.

Because the Division does not have complete control of the process involved in granting approvals for accepting a new employer into the pension system, this procedure may take many months to complete. During that time the employer will have employees eligible for membership, but not able to be enrolled. This means that when the employer receives a certification to withhold pension contributions, the employee will have a pension contribution liability to take them back to their eligible date. 

However, the Division does not promote withholding of pension contributions from employees before a certification is issued, and we cannot accept pension contributions withheld by the employer in an effort to avoid a hardship resulting from back deductions.

Social Security Office Locator

The Social Security Administration offers a Social Security Office Locator, enabling you or your employees to find the Social Security Office nearest to their home address. To use this, simply provide your zip code. The Locator can be found at http://s3abaca.ssa.gov/pro/fol/fol-home.html

 

 

 

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Last Updated: August 4, 2003