July 1, 2014
Correction of Errors under G.L. c. 32, § 20(5)(c)(2)
In all cases of correction of an error by the Concord Retirement Board of an underpayment or non-payment of a pension or benefit to a member or beneficiary of the Concord Retirement System which results in a onetime retroactive payment of benefits, such payment shall include interest for such period of underpayment or non-payment at the rate annually determined for such period by the Public Employee Retirement Administration Commission pursuant to G.L. c. 32, § 22(6).
In all cases of correction of an error by the Concord Retirement Board of an overpayment of a pension or benefit to a member or beneficiary of the Concord Retirement System, the amount of overpayment shall be due from the member or beneficiary, along with interest for said period of overpayment at the rate annually determined by the Public Employee Retirement Administration Commission pursuant to G.L. c. 32, § 22(6).
Pursuant to the judgment of the Supreme Judicial Court in Herrick v. Essex Regional Retirement Board, 465 Mass. 801 (2013) and PERAC Memorandum #32/2013, said interest shall be deemed to be the actuarial equivalent of the adjustment to the pension or benefit as set forth in G.L. c. 32 § 20(5)(c)(2).
In cases where a member’s contribution is insufficient, the member shall not be charged interest for the first 12 months following the discovery of the error. If total payment is not completed within 12 months after the error is discovered, actuarial interest will be applied to the unpaid balance until payment is completed.In cases where contributions are withheld in error, the Board will refund the erroneous deductions and the member will receive that portion of the annuity savings account interest attributable to the excess contributions.