State Employee Benefits Amendments

79
49-12-701
49-22-102
63A-17-501
63A-17-503
63A-17-504
63A-17-510
63A-17-514
63A-17-515
63A-17-516
63A-17-805
67-19f-102
67-19f-201
67-22-2
0
State Employee Benefits Amendments
2026 GENERAL SESSION
STATE OF UTAH
Chief Sponsor: Lincoln Fillmore
House Sponsor: Norman K Thurston
LONG TITLE
General Description:
This bill modifies provisions related to state employee benefits.
Highlighted Provisions:
This bill:
beginning on a specified date, establishes a paid time off program under which the
following employees receive paid time off in lieu of annual leave and sick leave:
new agency employees; and
current agency employees who elect to participate;
for each current agency employee who elects to participate in the program, directs the
Division of Finance to convert the employee's accrued annual leave hours to paid time
off hours at a one-to-one ratio;
grants the Division of Human Resource Management authority to make rules governing
the accrual and use of paid time off;
modifies the 401(k) match available to a qualifying employee who participates in the paid
time off program by changing the match rate and increasing the maximum employer
contribution;
requires each agency to establish and administer a leave bank program; and
makes technical and conforming changes.
Money Appropriated in this Bill:
None
Other Special Clauses:
None
Utah Code Sections Affected:
AMENDS:
49-12-701
, as last amended by Laws of Utah 2018, Chapter 415
49-22-102
, as last amended by Laws of Utah 2025, Chapter 298
63A-17-501
, as enacted by Laws of Utah 2021, Chapter 344
63A-17-503
, as renumbered and amended by Laws of Utah 2021, Chapter 344
63A-17-504
, as renumbered and amended by Laws of Utah 2021, Chapter 344
63A-17-510
, as renumbered and amended by Laws of Utah 2021, Chapter 344
63A-17-805
, as last amended by Laws of Utah 2023, Chapter 442
67-19f-102
, as last amended by Laws of Utah 2021, Chapter 344
67-19f-201
, as last amended by Laws of Utah 2023, Chapter 534
67-22-2
, as last amended by Laws of Utah 2025, Chapter 232
ENACTS:
63A-17-514
, Utah Code Annotated 1953
63A-17-515
, Utah Code Annotated 1953
63A-17-516
, Utah Code Annotated 1953
Be it enacted by the Legislature of the state of Utah:
Section 1. Section
49-12-701
is amended to read:
49-12-701
. Early retirement incentive -- Eligibility -- Calculation of benefit --
Payment of costs -- Savings to be appropriated by Legislature -- Restrictions on
reemployment.
(1)
Any member of this system may retire and receive the allowance allowed under
Subsection
(2)
if the member meets the following requirements as of the member's
retirement date:
(a)
the member is eligible for retirement under Section
49-12-401
, or has 25 years of
service credit;
(b)
the member elects to forfeit any stipend for retirement offered by the participating
employer; and
(c)
the member elects to retire from this system by applying for retirement by the date
established under Subsection
(3)(a)
or
(3)(b)
.
(2)
(a)
A member who retires under Subsection
(1)
shall receive 2% of that member's
final average salary for all years of service credit.
(b)
An actuarial reduction may not be applied to the allowance granted under this section.
(3)
In order to receive the allowance allowed by this section, a member shall submit an
application to the office as follows:
(a)
(i)
For state and school employees under Level A, the application shall be filed by
May 31, 1987. The member's retirement date shall then be set by the member on
the 1st or 16th day of July, August, or September, 1987.
(ii)
If a Level A member elects to retire, the executive director or participating
employer may request the member to delay the retirement date until a later date,
but no later than June 30, 1988.
(iii)
If the member agrees to delay the retirement date, the retirement date shall be
delayed, but service credit may not be accrued after the member's original
retirement date elected by the member, and compensation earned after the
member's original retirement date may not be used in the calculation of the final
average salary for determining the retirement allowance.
(b)
(i)
For political subdivision employees under Level B, the application shall be
filed by September 30, 1987.
(ii)
The retirement date shall then be set by the member on the 1st or 16th day of
July, August, September, October, November, or December, 1987.
(4)
(a)
The cost of providing the allowance under this section shall be funded in fiscal
year 1987-88 by a supplemental appropriation in the 1988 General Session based on
the retirement contribution rate increase established by the consulting actuary and
approved by the board.
(b)
The cost of providing the allowance under this section shall be funded beginning
July 1, 1988, by means of an increase in the retirement contribution rate established
by the consulting actuary and approved by the board.
(c)
The rate increase under Subsections
(4)(a)
and
(b)
shall be funded:
(i)
for state employees, by an appropriation from the account established by the
Division of Finance under Subsection
(4)(d)
, which is funded by savings derived
from this early retirement incentive and a work force reduction;
(ii)
for school employees, by direct contributions from the employing unit, which
may not be funded through an increase in the retirement contribution amount
established in
Title 53F, Chapter 2, State Funding -- Minimum School Program
;
and
(iii)
for political subdivisions under Level B, by direct contributions by the
participating employer.
(d)
(i)
Each year, any excess savings derived from this early retirement incentive
which are above the costs of funding the increase and the costs of paying insurance
, sick leave, compensatory leave, and vacation
and
leave under Subsections
(4)(c)(i)
and
(ii)
shall be reported to the Legislature and shall be appropriated as
provided by law.
(ii)
In the case of Subsection
(4)(c)(i)
, the Division of Finance shall establish an
account into which all savings derived from this early retirement incentive shall be
deposited as the savings are realized.
(iii)
In the case of Subsection
(4)(c)(ii)
, the State Board of Education shall certify the
amount of savings derived from this early retirement incentive.
(iv)
The State Board of Education and the participating employer may not spend the
savings until appropriated by the Legislature as provided by law.
(5)
A member who retires under this section is subject to Section
49-11-504
and
Chapter
11, Part 12, Postretirement Reemployment Restrictions Act
.
(6)
The board may adopt rules to administer this section.
(7)
The Legislative Auditor General shall perform an audit to ensure compliance with this
section.
Section 2. Section
49-22-102
is amended to read:
49-22-102
. Definitions.
As used in this chapter:
(1)
"Benefits normally provided" means the same as that term is defined in Section
49-12-102
.
(2)
(a)
"Compensation" means the total amount of payments made by a participating
employer to a member of this system for services rendered to the participating
employer, including:
(i)
bonuses;
(ii)
cost-of-living adjustments;
(iii)
other payments currently includable in gross income and that are subject to social
security deductions, including any payments in excess of the maximum amount
subject to deduction under social security law;
(iv)
amounts that the member authorizes to be deducted or reduced for salary deferral
or other benefits authorized by federal law; and
(v)
member contributions.
(b)
"Compensation" for purposes of this chapter may not exceed the amount allowed
under Internal Revenue Code, Section 401(a)(17).
(c)
"Compensation" does not include:
(i)
the monetary value of remuneration paid in kind, including a residence or use of
equipment;
(ii)
the cost of any employment benefits paid for by the participating employer;
(iii)
compensation paid to a temporary employee or an employee otherwise ineligible
for service credit;
(iv)
any payments upon termination, including accumulated
vacation, sick
leave
payments, severance payments, compensatory time payments, or any other special
payments;
(v)
any allowances or payments to a member for costs or expenses paid by the
participating employer, including automobile costs, uniform costs, travel costs,
tuition costs, housing costs, insurance costs, equipment costs, and dependent care
costs; or
(vi)
a teacher salary bonus described in Section
53F-2-513
.
(d)
The executive director may determine if a payment not listed under this Subsection
(2)
falls within the definition of compensation.
(3)
"Corresponding Tier I system" means the system or plan that would have covered the
member if the member had initially entered employment before July 1, 2011.
(4)
(a)
"Final average salary" means the amount calculated by averaging the highest five
years of annual compensation preceding retirement subject to Subsections
(4)(b)
,
(c)
,
(d)
,
(e)
, and
(f)
.
(b)
Except as provided in Subsection
(4)(c)
, the percentage increase in annual
compensation in any one of the years used may not exceed the previous year's
compensation by more than 10% plus a cost-of-living adjustment equal to the
decrease in the purchasing power of the dollar during the previous year, as measured
by a United States Bureau of Labor Statistics Consumer Price Index average as
determined by the board.
(c)
In cases where the participating employer provides acceptable documentation to the
office, the limitation in Subsection
(4)(b)
may be exceeded if:
(i)
the member has transferred from another agency; or
(ii)
the member has been promoted to a new position.
(d)
If the member retires more than six months from the date of termination of
employment, the member is considered to have been in service at the member's last
rate of pay from the date of the termination of employment to the effective date of
retirement for purposes of computing the member's final average salary only.
(e)
If the member has less than five years of service credit in this system, final average
salary means the average annual compensation paid to the member during the full
period of service credit.
(f)
The annual compensation used to calculate final average salary shall be based on a
period, as determined by the board, consistent with the period used to determine
years of service credit in accordance with Subsection
(8)
.
(5)
"Participating employer" means an employer that meets the participation requirements
of:
(a)
Sections
49-12-201
and
49-12-202
;
(b)
Sections
49-13-201
and
49-13-202
;
(c)
Section
49-19-201
; or
(d)
Section
49-22-201
or
49-22-202
.
(6)
(a)
"Regular full-time employee" means an employee:
(i)
whose term of employment for a participating employer contemplates continued
employment during a fiscal or calendar year;
(ii)
whose employment normally requires an average of 20 hours or more per week,
except as modified by the board; and
(iii)
who receives benefits normally provided by the participating employer.
(b)
"Regular full-time employee" includes:
(i)
a teacher whose term of employment for a participating employer contemplates
continued employment during a school year and who teaches half time or more;
(ii)
an education support professional:
(A)
who is hired before July 1, 2013; and
(B)
whose employment normally requires an average of 20 hours per week or
more for a participating employer, regardless of benefits provided;
(iii)
an appointive officer whose appointed position is full time as certified by the
participating employer;
(iv)
the governor, the lieutenant governor, the state auditor, the state treasurer, the
attorney general, and a state legislator;
(v)
an elected official not included under Subsection
(6)(b)(iv)
whose elected position
is full time as certified by the participating employer;
(vi)
a faculty member or employee of an institution of higher education who is
considered full time by that institution of higher education; and
(vii)
an individual who otherwise meets the definition of this Subsection
(6)
who
performs services for a participating employer through a professional employer
organization or similar arrangement.
(c)
"Regular full-time employee" does not include:
(i)
a firefighter service employee as defined in Section
49-23-102
;
(ii)
a public safety service employee as defined in Section
49-23-102
;
(iii)
an education support professional:
(A)
who is hired on or after July 1, 2013; and
(B)
who does not receive benefits normally provided by the participating
employer even if the employment normally requires an average of 20 hours per
week or more for a participating employer;
(iv)
an education support professional:
(A)
who is hired before July 1, 2013;
(B)
who did not qualify as a regular full-time employee before July 1, 2013;
(C)
who does not receive benefits normally provided by the participating
employer; and
(D)
whose employment hours are increased on or after July 1, 2013, to require an
average of 20 hours per week or more for a participating employer; or
(E)
who is a person working on a contract:
(I)
for the purposes of vocational rehabilitation and the employment and
training of people with significant disabilities; and
(II)
that has been set aside from procurement requirements by the state
pursuant to
Section
63G-6a-805
or the federal government
pursuant to
41
U.S.C. Sec. 8501 et seq.
(7)
"System" means the New Public Employees' Tier II Contributory Retirement System
created under this chapter.
(8)
"Years of service credit" means:
(a)
a period consisting of 12 full months as determined by the board;
(b)
a period determined by the board, whether consecutive or not, during which a regular
full-time employee performed services for a participating employer, including any
time the regular full-time employee was absent on a paid leave of absence granted by
a participating employer or was absent in the service of the United States government
on military duty as provided by this chapter; or
(c)
the regular school year consisting of not less than eight months of full-time service
for a regular full-time employee of an educational institution.
Section 3. Section
63A-17-501
is amended to read:
63A-17-501
. Definitions.
As used in this part:
(1)
"Continuing medical and life insurance benefits" means the state provided policy of
medical insurance and the state provided portion of a policy of life insurance, each
offered at the same:
(a)
benefit level and the same proportion of state/member participation in the total
premium costs as an active member as defined in Section
49-11-102
; and
(b)
coverage level for a member, two person, or family policy as provided to the
member at the time of retirement.
(2)
"Converted sick leave" means leave that has been converted from unused sick leave in
accordance with Section
63A-17-506
which may be used by an employee in the same
manner as:
(a)
paid time off;
(a)
(b)
annual leave;
(b)
(c)
sick leave; or
(c)
(d)
unused accumulated sick leave after the employee's retirement for the purchase
of continuing medical and life insurance benefits under Sections
63A-17-507
,
63A-17-508
, and
63A-17-804
.
(3)
"Paid time off" means the same as that term is defined in Section 63A-17-515.
Section 4. Section
63A-17-503
is amended to read:
63A-17-503
. Accumulated annual leave or paid time off -- Conversion to
deferred compensation plan.
(1)
The division shall implement a program whereby an employee may, upon termination
of employment or retirement, elect to convert any unused annual leave
or paid time off

into any of the employee's designated deferred compensation accounts that:
(a)
are sponsored by the Utah State Retirement Board; and
(b)
are qualified under Section 401(k) or Section 457 of the Internal Revenue Code.
(2)
Any annual leave
or paid time off
converted under Subsection
(1)
shall be converted
into the employee's deferred compensation account at the employee's pay rate at the time
of termination or retirement.
(3)
No employee may convert hours of accrued annual leave
or paid time off
to the extent
that any hours so converted would exceed the maximum amount authorized by the
Internal Revenue Code for each calendar year.
Section 5. Section
63A-17-504
is amended to read:
63A-17-504
. Accumulated annual leave or paid time off -- Annual conversion to
deferred compensation plan.
(1)
If the Legislature in an annual appropriations act with accompanying intent language
specifically authorizes and fully funds the estimated costs of this use, the division shall
implement a program that allows an employee, in the approved calendar year, to elect to
convert up to 20 hours of annual leave
or paid time off
, in whole hour increments not to
exceed $250 in value, into any of the employee's designated deferred compensation
accounts that:
(a)
are sponsored by the Utah State Retirement Board; and
(b)
are qualified under Section 401(k) or Section 457 of the Internal Revenue Code.
(2)
Any annual leave
or paid time off
converted under Subsection
(1)
shall be:
(a)
converted into the employee's deferred compensation account at the employee's pay
rate at the time of conversion; and
(b)
calculated in the last pay period of the leave year as determined by the Division of
Finance.
(3)
An employee may not convert hours of accrued annual leave
or paid time off
to the
extent that any hours converted would:
(a)
exceed the maximum amount authorized by the Internal Revenue Code for the
calendar year; or
(b)
cause the employee's balance of accumulated annual leave
or paid time off
to drop
below the maximum accrual limit provided by rule.
Section 6. Section
63A-17-510
is amended to read:
63A-17-510
. Annual leave -- Definitions -- Previously accrued hours --
Recognition of liability.
(1)
As used in this section:
(a)
(i)
"Annual leave II" means leave hours an employing agency provides to an
employee, beginning on the change date established in Subsection
(2)
, as time off
from work for personal use without affecting the employee's pay.
(ii)
"Annual leave II" does not include:
(A)
legal holidays under Section
63G-1-301
;
(B)
time off as compensation for actual time worked in excess of an employee's
defined work period;
(C)
sick leave;
(D)
paid or unpaid administrative leave; or
(E)
other paid or unpaid leave from work provided by state statute, administrative
rule, or by federal law or regulation.
(b)
"Change date" means the date established by the Division of Finance under
Subsection
(2)
when annual leave II begins for a state agency.
(2)
In accordance with the
Title 63G, Chapter 3, Utah Administrative Rulemaking Act
, the
Division of Finance shall establish a date that is no later than January 2, 2016, when a
state agency shall offer annual leave II in lieu of annual leave to an employee who is
eligible to receive paid leave.
(3)
An employing agency shall allow an employee who has an unused balance of accrued
annual leave before the change date, to use the annual leave under the same rules that
applied to the leave on the change date.
(4)
(a)
At the time of employee accrual of annual leave II, an employing agency shall set
aside the cost of each hour of annual leave II for each eligible employee in an amount
determined in accordance with rules made by the Division of Finance.
(b)
The rules made under Subsection
(4)(a)
shall consider:
(i)
the employee hourly rate of pay;
(ii)
applicable employer paid taxes that would be required if the employee was paid
for the annual leave II instead of using it for time off;
(iii)
other applicable employer paid benefits; and
(iv)
adjustments due to employee hourly rate changes, including the effect on accrued
annual leave II balances.
(c)
The Division of Finance shall provide that the amount of costs set aside under
Subsection
(4)(a)
and deposited into the fund increase by at least the projected
increase in annual leave liability for that year, until the year-end trust fund balances
are reached as required under Subsection
67-19f-201(3)(b)
.
(5)
The cost set aside under Subsection
(4)
shall be deposited by the Division of Finance
into the State Employees' Annual Leave Trust Fund created in Section
67-19f-201
.
(6)
For annual leave hours accrued before the change date, an employing agency shall
continue to comply with the Division of Finance requirements for contributions to the
termination pool.
(7)
In accordance with
Title 63G, Chapter 3, Utah Administrative Rulemaking Act
:
(a)
the division shall make rules for the accrual and use of annual leave II provided
under this section; and
(b)
the Division of Finance shall make rules for the set aside provisions under
Subsections
(4)
and
(5)
.
(8)
The provisions of this section are subject to the provisions of Section
63A-17-515
.
Section 7. Section
63A-17-514
is enacted to read:
63A-17-514
. One time leave program election.
(1)
As used in this section:
(a)
"Active member" means the same as that term is defined in Section
49-11-102
.
(b)
"Change date" means the same as that term is defined in Section
63A-17-515
.
(c)
"Current employee" means an agency employee who is employed by an agency as of
the change date.
(d)
"Legacy program" means:
(i)
accruing annual leave II as defined in Section
63A-17-510
and sick leave under
the same or substantially the same rules in place on the day immediately
preceding the change date; and
(ii)
for a qualifying employee, being eligible for the employer matching retirement
contribution available to a legacy qualifying employee under Section
63A-17-805
.
(e)
"Paid time off program" means:
(i)
accruing paid time off in lieu of annual leave II and sick leave, as provided in
Section
63A-17-515
; and
(ii)
(A)
for a qualifying employee who is an active member in Tier I as defined in
Section
49-11-102
, being eligible for the employer matching retirement
contribution available to a legacy qualifying employee under Section
63A-17-805
; or
(B)
for a qualifying employee who is an active member in Tier II as defined in
Section
49-11-102
, being eligible for the employer matching retirement
contribution available to a Tier II qualifying employee under Section
63A-17-805
.
(f)
"Qualifying employee" means the same as that term is defined in Section
63A-17-805
.
(2)
(a)
On or before the deadline established by the Division of Finance, each agency
employee shall elect whether, on and after the change date, the employee will
participate in the legacy program or the paid time off program.
(b)
After the deadline to make an election under Subsection
(2)(a)
, an employee may not
modify the employee's election.
(c)
If an employee does not submit a timely election under Subsection
(2)(a)
, the
employee shall participate in the paid time off program.
(3)
In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
Division of Finance shall makes rules governing the process for the election described in
this section, including establishing:
(a)
the deadline for an employee to submit the employee's election under Subsection
(2)(a)
; and
(b)
if necessary, the deadline for an agency to report each employee's election to the
Division of Finance.
Section 8. Section
63A-17-515
is enacted to read:
63A-17-515
. Paid time off.
(1)
As used in this section:
(a)
"Annual leave II" means the same as that term is defined in Section
63A-17-510
.
(b)
"Change date" means the date established by the Division of Finance under
Subsection
(2)
.
(c)
(i)
"Paid time off" means leave hours an agency provides to an employee
beginning on the change date, as time off from work for personal use without
affecting the employee's pay.
(ii)
"Paid time off" does not include:
(A)
legal holidays under Section
63G-1-301
;
(B)
time off as compensation for actual time worked in excess of an employee's
defined work period;
(C)
sick leave;
(D)
paid or unpaid administrative leave; or
(E)
other paid or unpaid leave from work provided by state statute, administrative
rule, or by federal law or regulation.
(d)
"PTO employee" means an agency employee who:
(i)
in accordance with Section
63A-17-514
, elects to participate in the paid time off
program as defined in Section
63A-17-514
;
(ii)
fails to submit a timely election in accordance with Section
63A-17-514
; or
(iii)
is hired or rehired on or after the change date.
(2)
In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
Division of Finance shall establish a date that is not later than July 1, 2027, beginning on
which an agency shall offer each PTO employee paid time off in lieu of:
(a)
annual leave II; and
(b)
the sick leave offered to employees as of the change date.
(3)
(a)
Except as provided in Subsection
(3)(b)
, the provisions of this section do not
affect a PTO employee's balance or use of leave hours accrued before the change date.
(b)
On the change date, the Division of Finance shall convert each PTO employee's
accrued annual leave balance to paid time off at a one-to-one ratio.
(4)
(a)
At the time a PTO employee accrues paid time off, the agency shall set aside the
cost of each hour of paid time off for the PTO employee in an amount determined in
accordance with rules the Division of Finance makes in accordance with Title 63G,
Chapter 3, Utah Administrative Rulemaking Act.
(b)
In making rules under Subsection
(4)(a)
, the Division of Finance shall consider:
(i)
the PTO employee's hourly rate of pay;
(ii)
applicable employer paid taxes that would be required if the PTO employee were
paid for the paid time off instead of the PTO employee using the paid time off for
leave;
(iii)
other applicable employer paid benefits; and
(iv)
adjustments due to employee hourly rate changes, including the effect on accrued
paid time off balances.
(c)
The Division of Finance shall deposit money set aside in accordance with Subsection
(4)
into the State Employees' Leave Trust Fund created in Section
67-19f-201
.
(d)
Subsection
(4)(a)
does not apply to paid time off hours that were converted from
annual leave in accordance with Subsection
(3)
, if:
(i)
for converted hours that were not annual leave II hours, the agency continues to
comply with the Division of Finance requirements for contributions to the
termination pool; or
(ii)
for converted hours that were annual leave II hours, the agency complied with the
requirements of Subsection
63A-17-510(4)
when the annual leave II hours were
accrued.
(5)
In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
division shall make rules governing the accrual and use of paid time off provided under
this section.
Section 9. Section
63A-17-516
is enacted to read:
63A-17-516
. Agency leave bank program.
(1)
Each agency shall establish and administer a leave bank program.
(2)
Each agency shall ensure that the agency's leave bank program established in
accordance with this section:
(a)
allows an employee to voluntarily donate the employee's paid time off to a
centralized leave bank administered by the agency; and
(b)
directs the agency to distribute leave from the leave bank to an employee who
satisfies the agency's eligibility criteria.
(3)
An employee may not donate sick leave to a leave bank established in accordance with
this section.
(4)
The division shall create a model leave bank program policy that complies with this
section and make a copy of the model policy available to other agencies.
(5)
In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
division may make rules governing leave bank programs described in this section.
Section 10. Section
63A-17-805
is amended to read:
63A-17-805
. State employee matching supplemental defined contribution benefit.
(1)
As used in this section:
(a)
"Active member" means the same as that term is defined in Section
49-11-102
.
(b)
"Change date" means the same as that term is defined in Section 63A-17-515.
(c)
"Legacy employee" means an agency employee who, in accordance with Section
63A-17-514
, elects to participate in the legacy program as defined in Section
63A-17-514
.
(d)
"Legacy qualifying employee" means:
(i)
a qualifying employee who is an active member in Tier I, as defined in Section
49-11-102
; or
(ii)
a legacy employee.
(a)
(e)
"Qualifying account" means:
(i)
a defined contribution plan qualified under Section 401(k) of the Internal Revenue
Code, which is sponsored by the Utah State Retirement Board;
(ii)
a deemed Individual Retirement Account authorized under the Internal Revenue
Code, which is sponsored by the Utah State Retirement Board; or
(iii)
a similar savings plan or account authorized under the Internal Revenue Code,
which is sponsored by the Utah State Retirement Board.
(b)
(f)
"Qualifying employee" means an employee who is:
(i)
in a position that is:
(A)
receiving retirement benefits under
Title 49, Utah State Retirement and
Insurance Benefit Act
; and
(B)
accruing paid leave benefits that can be used in the current and future calendar
years; and
(ii)
not an employee who is reemployed as that term is:
(A)
defined in Section
49-11-1202
; or
(B)
used in Section
49-11-504
.
(g)
"Tier II qualifying employee" means a qualifying employee who:
(i)
is an active member in Tier II, as defined in Section
49-11-102
; and
(ii)
is not a legacy employee.
(2)
Subject to the requirements of Subsection
(3)
and applicable federal law
, an employer
shall make a biweekly matching contribution to every qualifying employee's defined
contribution plan qualified under Section 401(k) of the Internal Revenue Code,
subject
to federal requirements and limitations,
which is sponsored by the Utah State
Retirement Board
.
, as follows:
(a)
before the change date, at a 100% match rate; or
(b)
on or after the change date:
(i)
for a legacy qualifying employee, at a 100% match rate; and
(ii)
for a Tier II qualifying employee, at a 100% match rate for the first $26 the
employee contributes and at a 50% match rate for any amount the employee
contributes above $26.
(3)
(a)
In accordance with the requirements of this Subsection
(3)
, each qualifying
employee shall be eligible to receive the same dollar amount for the contribution
under Subsection
(2)
.
(b)
(a)
A qualifying employee who is hired before July 1, 2023:
(i)
shall receive the contribution amount determined under Subsection
(3)(f)
(3)(e)
if
the qualifying employee makes a voluntary personal contribution to one or more
qualifying accounts in an amount equal to or greater than the employer's
contribution amount determined under Subsection
(3)(f)
(3)(e)
;
(ii)
shall receive a partial contribution amount that is equal to the qualifying
employee's personal contribution amount if the employee makes a voluntary
personal contribution to one or more qualifying accounts in an amount less than
the employer's contribution amount determined under Subsection
(3)(f)
(3)(e)
; or
(iii)
may not receive a contribution under Subsection
(2)
if the qualifying employee
does not make a voluntary personal contribution to a qualifying account.
(c)
(b)
(i)
An employer shall automatically enroll a qualifying employee who is hired
on or after July 1, 2023, to make a personal contribution to a defined contribution
plan qualified under Section 401(k) of the Internal Revenue Code, which is
sponsored by the Utah State Retirement Board, in an amount equal to
the lesser of:
(A)
the employer's contribution amount determined under Subsection
(3)(f)
.
(3)(e); or
(B)
$26.
(ii)
A qualifying employee who makes a personal contribution in accordance with
Subsection
(3)(c)(i)
(3)(b)(i)
shall receive
the lesser of:
(A)
the contribution amount determined under Subsection
(3)(f)
.
(3)(e); or
(B)
$26.
(d)
(c)
(i)
A qualifying employee who is hired on or after July 1, 2023, may opt out
of the automatic enrollment by choosing not to make any future personal
contributions.
(ii)
A
Subject to Subsection
(3)(d)
, a
qualifying employee who opts out of automatic
enrollment in accordance with this Subsection
(3)(d)
(3)(c)
may not receive a
contribution under Subsection
(2)
.
(e)
(d)
(i)
A qualifying employee who is hired on or after July 1, 2023, may modify
the automatic enrollment by opting to make future personal contributions:
(A)
in an amount other than the amount determined under Subsection
(3)(f)
(3)(b)
;
or
(B)
to a qualifying account other than the defined contribution plan qualified
under Section 401(k) of the Internal Revenue Code, which is sponsored by the
Utah State Retirement Board.
(ii)
A qualifying employee who opts to make a personal contribution for less than the
amount determined under Subsection
(3)(f)
(3)(b)
shall receive a partial
contribution that is equal to the qualifying employee's personal contribution
amount.
(f)
(e)
(i)
Subject to the maximum limit under Subsection
(3)(f)(iii)
(3)(e)(iii) or (iv)
,
the Legislature shall annually determine the contribution amount that an employer
shall provide to each qualifying employee under Subsection
(2)
.
(ii)
The division shall make recommendations annually to the Legislature on the
contribution amount required under Subsection
(2)
, in consultation with the
Governor's Office of Planning and Budget and the Division of Finance.
(iii)
The
Before the change date, the
biweekly matching contribution amount
required under Subsection
(2)
may not exceed $26 for each qualifying employee.
(iv)
On or after the change date, the biweekly matching contribution amount required
under Subsection
(2)
may not exceed:
(A)
for a legacy qualifying employee, $26; or
(B)
for a Tier II qualifying employee, the greater of 2% of the qualifying
employee's biweekly salary or $26.
(4)
A qualifying employee is eligible to receive the biweekly contribution under this section
for any pay period in which the employee is in a paid status or other status protected by
federal or state law.
(5)
The employer and employee contributions made and related earnings under this section
vest immediately upon deposit and can be withdrawn by the employee at any time,
subject to Internal Revenue Code regulations on the withdrawals.
(6)
In accordance with
Title 63G, Chapter 3, Utah Administrative Rulemaking Act
, the
director shall make rules establishing procedures to implement the provisions of this
section.
Section 11. Section
67-19f-102
is amended to read:
67-19f-102
. Definitions.
As used in this chapter:
(1)
"Annual leave II" means the same as that term is defined in Section
63A-17-510
.
(2)
"Board of trustees" or "board" means the board of trustees created in Section
67-19f-202
.
(3)
"Income" means the revenues received by the state treasurer from investments of the
trust fund principal.
(4)
"Paid time off" means the same as that term is defined in Section 63A-17-515.
(4)
(5)
"Trust fund" means the State Employees'
Annual
Leave Trust Fund created in
Section
67-19f-201
.
Section 12. Section
67-19f-201
is amended to read:
67-19f-201
. State Employees' Leave Trust Fund -- Creation -- Oversight --
Dissolution.
(1)
There is created a trust fund entitled the "State Employees'
Annual
Leave Trust Fund."
(2)
The trust fund consists of:
(a)
ongoing revenue provided from a state agency set aside for accrued annual leave II
required under Section
63A-17-510
;
(b)
money set aside for accrued paid time off in accordance with Section 63A-17-515;
(b)
(c)
appropriations made to the trust fund by the Legislature, if any;
(c)
(d)
transfers from the termination pool described in Subsection
63A-17-510(6)

made by the Division of Finance to the trust fund for annual leave liabilities accrued
before the change date established under Section
63A-17-510
;
(d)
(e)
income; and
(e)
(f)
revenue received from other sources.
(3)
(a)
The Division of Finance shall account for the receipt and expenditures of trust
fund money.
(b)
The Division of Finance shall make the necessary adjustments to the amount of set
aside costs required under Subsection
63A-17-510(4)(a)
to provide that upon the trust
fund's accrual of funding equal to 10% of the annual leave liability, year-end trust
fund balances remain equal to at least 10% of the total state employee annual leave
liability.
(4)
(a)
The state treasurer shall invest trust fund money by following the procedures and
requirements of
Part 3, Investment of Trust Funds
.
(b)
(i)
The trust fund shall earn interest.
(ii)
The state treasurer shall deposit all interest or other income earned from
investment of the trust fund back into the trust fund.
(5)
The board of trustees created in Section
67-19f-202
may expend money from the trust
fund for:
(a)
reimbursement to the employer of the costs paid to the trust fund in accordance with
Section
63A-17-510
or 63A-17-515
as annual leave II
or paid time off
is used by an
employee;
(b)
payments based on accrued annual leave
and on
,
accrued annual leave II
, and
accrued paid time off
that are made upon termination of an employee;
(c)
refunds for overpayments; and
(d)
reasonable administrative costs that the board of trustees incurs in performing its
duties as trustee of the trust fund.
(6)
The board of trustees shall ensure that:
(a)
money deposited into the trust fund is irrevocable and is expended only for the costs
described in Subsection
(5)
; and
(b)
assets of the trust fund are dedicated to providing annual leave
and
,
annual leave II
,
and paid time off
established by statute and rule.
(7)
A creditor of the board of trustees or a state agency liable for annual leave benefits may
not seize, attach, or otherwise obtain assets of the trust fund.
Section 13. Section
67-22-2
is amended to read:
67-22-2
. Compensation -- Other state officers.
(1)
As used in this section:
(a)
"Appointed executive" means the:
(i)
commissioner of the Department of Agriculture and Food;
(ii)
commissioner of the Insurance Department;
(iii)
commissioner of the Labor Commission;
(iv)
director, Department of Alcoholic Beverage Services;
(v)
commissioner of the Department of Financial Institutions;
(vi)
executive director, Department of Commerce;
(vii)
executive director, Commission on Criminal and Juvenile Justice;
(viii)
adjutant general;
(ix)
executive director, Department of Cultural and Community Engagement;
(x)
executive director, Department of Corrections;
(xi)
commissioner, Department of Public Safety;
(xii)
executive director, Department of Natural Resources;
(xiii)
executive director, Governor's Office of Planning and Budget;
(xiv)
executive director, Department of Government Operations;
(xv)
executive director, Department of Environmental Quality;
(xvi)
executive director, Governor's Office of Economic Opportunity;
(xvii)
executive director, Department of Workforce Services;
(xviii)
executive director, Department of Health and Human Services, Nonphysician;
(xix)
executive director, Department of Transportation;
(xx)
executive director, Department of Veterans and Military Affairs;
(xxi)
advisor, Public Lands Policy Coordinating Office, created in Section
63L-11-201
;
(xxii)
Great Salt Lake commissioner, appointed under Section
73-32-201
; and
(xxiii)
Utah water agent, appointed under Section
73-10g-702
.
(b)
"Board or commission executive" means:
(i)
members, Board of Pardons and Parole;
(ii)
chair, State Tax Commission;
(iii)
commissioners, State Tax Commission;
(iv)
executive director, State Tax Commission;
(v)
chair, Public Service Commission; and
(vi)
commissioners, Public Service Commission.
(c)
"Deputy" means the person who acts as the appointed executive's second in
command as determined by the Division of Human Resource Management.
(2)
(a)
The director of the Division of Human Resource Management shall:
(i)
before October 31 of each year, recommend to the governor a compensation plan
for the appointed executives and the board or commission executives; and
(ii)
base those recommendations on market salary studies conducted by the Division
of Human Resource Management.
(b)
(i)
The Division of Human Resource Management shall determine the salary range
for the appointed executives by:
(A)
identifying the salary range assigned to the appointed executive's deputy;
(B)
designating the lowest minimum salary from those deputies' salary ranges as
the minimum salary for the appointed executives' salary range; and
(C)
designating 105% of the highest maximum salary range from those deputies'
salary ranges as the maximum salary for the appointed executives' salary range.
(ii)
If the deputy is a medical doctor, the Division of Human Resource Management
may not consider that deputy's salary range in designating the salary range for
appointed executives.
(c)
(i)
Except as provided in Subsection
(2)(c)(ii)
, in establishing the salary ranges for
board or commission executives, the Division of Human Resource Management
shall set the maximum salary in the salary range for each of those positions at
90% of the salary for district judges as established in the annual appropriation act
under Section
67-8-2
.
(ii)
In establishing the salary ranges for an individual described in Subsection
(1)(b)(ii)
,
(1)(b)(iii)
, or
(1)(b)(iv)
, the Division of Human Resource Management
shall set the maximum salary in the salary range for each of those positions at
100% of the salary for district judges as established in the annual appropriation act
under Section
67-8-2
.
(3)
(a)
(i)
Except as provided in Subsection
(3)(a)(ii)
or Subsection
(3)(d)
, the
governor shall establish a specific salary for each appointed executive within the
range established under Subsection
(2)(b)
.
(ii)
If the executive director of the Department of Health and Human Services is a
physician, the governor shall establish a salary within the highest physician salary
range established by the Division of Human Resource Management.
(iii)
The governor may provide salary increases for appointed executives within the
range established by Subsection
(2)(b)
and identified in Subsection
(3)(a)(ii)
.
(b)
The governor shall apply the same overtime regulations applicable to other FLSA
exempt positions.
(c)
The governor may develop standards and criteria for reviewing the appointed
executives.
(d)
If under Section
73-10g-702
the governor appoints an individual who is serving in an
appointed executive branch position to be the Utah water agent, the governor shall
adjust the salary of the Utah water agent to account for salary received for the
appointed executive branch position.
(4)
Salaries for other Schedule A employees, as defined in Section
63A-17-301
, that are not
provided for in this chapter, or in Title
67, Chapter 8
, Utah Elected Official and Judicial
Salary Act, shall be established as provided in Section
63A-17-301
.
(5)
(a)
The Legislature fixes benefits for the appointed executives and the board or
commission executives as follows:
(i)
the option of participating in a state retirement system established by Title
49,
Utah State Retirement and Insurance Benefit Act
, or in a deferred compensation
plan administered by the State Retirement Office in accordance with the Internal
Revenue Code and its accompanying rules and regulations;
(ii)
health insurance;
(iii)
dental insurance;
(iv)
basic life insurance;
(v)
unemployment compensation;
(vi)
workers' compensation;
(vii)
required employer contribution to Social Security;
(viii)
long-term disability income insurance;
(ix)
the same additional state-paid life insurance available to other noncareer service
employees;
(x)
the same severance pay available to other noncareer service employees;
(xi)
the same leave, holidays, and allowances granted to Schedule B state employees
as follows:
(A)
sick leave;
(B)
converted sick leave if accrued
prior to
January 1, 2014;
(C)
educational allowances;
(D)
holidays;
and
(E)
annual leave except that annual leave shall be accrued at the maximum rate
provided to Schedule B state employees;
and
(F)
paid time off;
(xii)
the option to convert accumulated sick leave to cash or insurance benefits as
provided by law or rule upon resignation or retirement according to the same
criteria and procedures applied to Schedule B state employees;
(xiii)
the option to purchase additional life insurance at group insurance rates
according to the same criteria and procedures applied to Schedule B state
employees; and
(xiv)
professional memberships if being a member of the professional organization is
a requirement of the position.
(b)
Each department shall pay the cost of additional state-paid life insurance for its
executive director from its existing budget.
(6)
The Legislature fixes the following additional benefits:
(a)
for the executive director of the Department of Transportation a vehicle for official
and personal use;
(b)
for the executive director of the Department of Natural Resources a vehicle for
commute and official use;
(c)
for the commissioner of Public Safety:
(i)
an accidental death insurance policy if POST certified; and
(ii)
a public safety vehicle for official and personal use;
(d)
for the executive director of the Department of Corrections:
(i)
an accidental death insurance policy if POST certified; and
(ii)
a public safety vehicle for official and personal use;
(e)
for the adjutant general a vehicle for official and personal use;
(f)
for each member of the Board of Pardons and Parole a vehicle for commute and
official use; and
(g)
for the executive director of the Department of Veterans and Military Affairs a
vehicle for commute and official use.
Section 14.
Effective Date.
This bill takes effect on
May 6, 2026
.
3-6-26 11:14 PM