Empower’s Plan Service Center (PSC) is your central hub for plan administration, resources, and tools designed to help you complete tasks accurately and efficiently. In the PSC, you can:

• Visit the Action Center to help you stay on top of outstanding tasks.
• Use the Case Management Tool to submit common plan requests and check the status of open cases.
• Navigate to the Participants menu to search for and manage your employees’ information.
• Process Payroll to submit wage and contribution information.
• View Reports to identify opportunities for targeted education and engagement to improve retirement outcomes.
• Manage Plan Contacts to ensure the right people at your municipality have the system access they need.

Watch this PSC Overview to learn more about the key features available online.

1. Employer reports eligible employee 
   When an employee becomes eligible to participate in the MERS Defined Contribution Plan (newly hired or transferred divisions), report the employee to Empower through the payroll process in the Plan Service Center (PSC).If your plan allows employees to make a one-time election of required pre-tax contributions, you may have the employee complete this Contribution Election form to retain for your records. This form does not need to be submitted to MERS or Empower.
2. Employee receives instructions to create their online account
   MERS recordkeeper Empower will send the employee communications encouraging them to create their online account. If you added an email address, the employee will receive electronic communications. If there is no email address on file, the employee will receive a postcard at their home address.
3. Employee creates their online account
   The employee visits empower.com/MERS and selects “Register” to create their online account. They will be asked to verify their account (enter SSN, date of birth, and zip code), add their contact information (personal email and mobile phone number), create a username and password, and complete any other prompts.
4. Employee receives ongoing communications from MERS and Empower
   The newly enrolled employee will receive a confirmation of enrollment, followed by ongoing communications about the best next steps (designate beneficiaries, download the Empower app, etc.) to help them make the most of their plan.

 Participant Handbook

If your municipality’s plan has a probationary period, begin reporting the employee when they are hired. They will start accruing service (for vesting purposes) as of their actual hire date. Contributions (if applicable) will begin after the probationary period ends.

Rehired employees (that are not considered “retirees” for purposes of the MERS Defined Benefit Plan) are placed in the open active plan even if it is different from the plan they retired from. Please refer to the “New Hire” section on this page for more information.

When you have an employee transferring from one division to another, the standard rules place them into the active plan at the time of a transfer. Treating transferred employees the same will provide consistency and effortless recordkeeping during transitions. Your municipality may adopt the plan continuation rules using the Employer Resolution Establishing a Uniform Transfer Provision.

Standard Transfer Rules and Plan Continuation Rules
Under the Standard Transfer Rules, if an employee transfers from one division to another, they must participate in the open, active retirement plan of the new division. Under the Plan Continuation Rules, your municipality will enroll a transfer or rehired employee into the closed plan that is the same plan type as the plan the employee transferred from (or was formerly enrolled in), whether open or closed, if such plan exists. When both open and closed plans of that type exist, the employee will be enrolled in the open plan. If the same plan type does not exist, the employee is enrolled in the open plan for that division, regardless of plan type.

Under either rule, where a plan offers an option in employee contributions, the plans’ default rate will apply to the returning or transferring employee.

A Participant Transfer Certification form is required regardless of which rules are adopted.

Do you have an employee who is leaving your municipality? Whether it’s for retirement or any other reason, you must update their change in employment status when you submit their last payroll information in the Plan Service Center (PSC). Reporting this information as soon as administratively feasible ensures the employee receives timely information on how to use their account.

When to report terminations:

• Terminated from employment
• Retired
• Terminated due to disability
• Employee has died

It is important to note that terminated employees do NOT have to roll out their MERS account balance upon termination. In fact, there are many benefits to keeping their money with MERS even throughout retirement. For more information on these benefits, view our rollover information.

If a participant in your municipality’s plan is deceased, please contact the MERS team at Empower by calling 833.500.6377.

If known, please provide the following information:

• Participant’s name
• Social Security number
• Date of death
• Family contact information

An original or certified copy of the death certificate must be submitted to Empower.

One of the most important things employees can do for themselves and their families is to name a beneficiary. Equally important is to make sure beneficiary information remains up-to-date. Employees can name their beneficiaries and update contact information through their online account at empower.com/MERS.

If an employee does not wish to go online to make changes, they may contact the MERS team at Empower by calling 833.500.6377 to obtain a Beneficiary Designation form. You may also access the form by signing in to the Plan Service Center (PSC) and navigating to “Participants” and “Employee forms.” Then, select “Beneficiary Designation.”

If an employee is actively employed, they must change their contact information by contacting you, their employer. This information will be reported through your ongoing payroll reports to Empower through the Plan Service Center (PSC).

Once an employee separates from employment, they must change their contact information directly through Empower (either online at empower.com/MERS or by calling 833.500.6377).

All voluntary after-tax contributions must be initiated by the employee via their online account at empower.com/MERS or by calling the MERS team at Empower at 833.500.6377. You may share this guide with your employees to help them change their voluntary after-tax contributions.

When an employee changes their voluntary after-tax contributions, you will receive a notification with updated information, enabling you to adjust payroll withholding accordingly. An email notification will be sent every Monday morning that summarizes requests submitted by your employees. These changes are also available on the “To-Do” list inside the Plan Service Center (PSC).

View IRS-established retirement plan contribution limits and reporting data (pdf) for the current year.

Unless otherwise adopted by the employer, defined contribution plans earn service based on elapsed time. Elapsed time looks at only the date of hire and the date of termination to calculate time toward meeting vesting. One year of vesting service is granted for every twelve months of work.

Example: If an employee has a hire date of 10/1/2024 and a termination date of 10/5/2025, one year of service is earned toward vesting. If the termination date was 9/15/2025, no service would be earned.

Employees may combine MERS-to-MERS service to meet vesting and eligibility requirements if they meet both of the following requirements:

• Have at least one year (12 months) of service credit with each MERS employer. If the employee left employment with one employer and is hired by another in the same month, only one month will be counted toward the 12-month requirement.
• Have no break in service longer than 20 years (240 months).

Employees who would like to verify MERS-to-MERS time for inclusion in defined contribution (DC) service should contact the MERS Service Center at 800.767.6377 or fill out and submit the MERS-to-MERS Service Verification Form (form MD-016). MERS-to-MERS time will only apply before a DC distribution is taken or a forfeiture occurs, ensuring that employers will not incur future liabilities.

Please note the following for employees who retire with a MERS Defined Contribution Plan (DC) and plan to return to work with the same employer they retired from:

• An employee with a DC plan is considered a retiree when they have separated from service on or after reaching normal retirement age. Typically, this is age 60, but your municipality may have elected a different age.
• The employee must have a bona fide retirement before returning to work, per IRS rules. Bona fide separation is defined as no formal or informal agreement to return to work prior to retirement, and they must have a 60 day separation between termination and returning to work.
• If they are considered an eligible employee (meets the definition of a DC plan retiree, has a bona fide retirement, and is rehired AFTER 9/26/2022), they must be re-enrolled into the defined contribution plan. Retirees rehired PRIOR to 9/26/2022 are not eligible to enroll in the open retirement plan.
• Retirees are not eligible to re-enroll in a MERS Defined Benefit or Hybrid Plan.
• There is no limit to the hours they may work in a calendar year.
• Distributions are allowed to continue while the individual is actively employed as long as they are age 60 or older.

In the event an employee becomes permanently disabled while actively employed, all funds become fully vested. The Internal Revenue Code definition of disability, Section 72(m)(7), states that “an individual shall be considered to be disabled if they are unable to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment which can be expected to result in death or to be of long-continued and indefinite duration.”

To request a distribution, the employee must obtain a signed letter verifying his or her qualification under the Internal Revenue Code definition of disability, Section 72(m)(7), from his or her physician. When the employee has received this document, they will need to submit it, along with a completed Disability Withdrawal Request form, to MERS’ recordkeeper, Empower. This form is available through the employee’s online account or by contacting the MERS team at Empower by calling 833.500.6377.

Empower will follow up with any additional instructions or documentation needed to complete the review process.

It is important to monitor your defined contribution (DC) forfeiture balance throughout the year to ensure you use your funds in accordance with Internal Revenue Service (IRS) guidelines.

What is a forfeiture?

A forfeiture is the non-vested employer contributions of a participant’s account that they give up upon separating from employment before meeting vesting requirements, and:

1. Fulfill a 12-month separation of employment (date of termination + 12 months), OR
2. Take a distribution from their account following termination

You can view which participant accounts are included in the last forfeiture deposit through the “Forfeiture / Unallocated Plan Asset Account Detail” report available in the Plan Service Center (PSC).

How can forfeitures be used?

Per IRS regulations, funds in your forfeiture account must be used no later than the end of the calendar year following the year in which the funds were forfeited and can be used in three ways:

1. Funds may be used to offset future employer contributions – the majority of plans use this option.
2. Funds can be used to offset employee fees.
3. Funds can be equally distributed across all employee accounts.

Forfeitures are pulled from affected participant accounts every week, at the earlier of the participant’s 12-month separation from employment or the participant’s taking a distribution.

Resources

 How to view plan forfeiture balances (video)

 How to offset a payroll with a forfeiture (video)

If your municipalities currently offers the MERS Defined Benefit (or Hybrid) Plan to employees and would like to change to a MERS Defined Contribution Plan – here is what you need to know.

Municipalities interested in closing their defined benefit plan are required to perform an actuarial projection and sustainability analysis. This report will provide the long-term costs of both your current and proposed plans.

Groups can choose either make this change effective for:

1. New hires, transferring employees and rehired employees
   • Active employees would remain in the defined benefit plan, accruing additional benefits and service.
   • Active employees may be given a one-time option to convert from defined benefit to defined contribution. Divisions must meet an 80% funding level to do so.
   • The closed defined benefit plan would be closed to new hires, rehires and transfers.
2. All employees
   • With this option the municipality freezes the defined benefit plan, whereby active employees no longer accrue benefits and service under the defined benefit plan on a moving-forward basis.
   • Active employees may be given a one-time option to convert their defined benefit plan to defined contribution. Divisions must meet an 80% funding level to do so.
   • For those not converting, service earned in the defined contribution plan is used toward meeting vesting and eligibility in the former defined benefit plan and a defined benefit is available once the employee becomes eligible based on the years of service earned in the former, frozen defined benefit plan.
   • Actives, new hires, transfers and rehires would begin a new benefit structure.

It is important to note that by changing to a defined contribution plan, this does not eliminate the defined benefit plan’s unfunded liabilities.The actuarial sustainability analysis that will be included in the projection study will indicate what amortization period is needed and what the employers’ contribution requirements will be.

How do I begin the process?

Step 1: Submit a Request for a Projection Study (Form DB-013b).

The Projection Study:

• Shows the long-term cost of the current benefit plan compared to the long-term cost of the proposed benefit plan.
• Shows how employer contributions would be affected 20 years into the future.
• Provides a sustainability analysis that indicates the amortization period need.

Step 2: Review the results of your Projection Study with MERS and your municipality’s key decision makers and obtain necessary approval from your governing body.

Step 3: Obtain appropriate forms from your MERS Benefit Plan Coordinator.

Step 4: Return all signed forms to your MERS Benefit Plan Coordinator. Once MERS receives these documents, we will update our records and confirm that the change has been made.

Your MERS Regional Team

Our staff are dedicated to helping you make the most out of your plan.

• Benefit Plan Advisor: Assists you with implementing MERS high-quality, cost-effective solutions and serves as a liaison between employers, boards, unions, and consultants throughout the decision-making process.
• Regional Manager: Meets with you to provide consultation regarding plan administration, collective bargaining assistance, governing body education, and plan and benefit changes.
• Benefit Plan Coordinator: Facilitates implementation of plan changes and everyday service needs.
• Benefit Education Specialist: Provides education to your employees to help them understand the MERS plan(s) you offer and prepare for their retirement.

Our Recordkeeper Empower

MERS works with Empower to provide you with access to the Plan Service Center (PSC), your central hub for plan administration, resources, and tools designed to help you complete tasks accurately and efficiently. Throughout the site, you’ll find helpful how-to videos and guides.

If you need assistance, we encourage you to create a case. This will ensure your request goes to the team that can best serve you. Learn more about the case types or watch the video on how to submit cases.

Need help logging in? First, check with the person at your municipality who manages plan contacts to ensure you have been granted access. Then, call 800.840.3272 and ask for “PSC Support.”