(a) The state board of regents is hereby authorized to develop and implement a phased-retirement program for unclassified employees of state educational institutions under the management of the board in accordance with the provisions of this act. Subject to rules and regulations adopted by the state board of regents, each state educational institution may enter into phased-retirement agreements under this section with unclassified employees of the institution. Such agreements shall provide that the unclassified employee shall accept an appointment in a position which is less than the employee’s current appointment but which is at least 1/4 time, and the state educational institution shall pay on behalf of the employee: (1) The amount specified by the Kansas state employees health care commission under Kan. Stat. Ann. § 75-6508, and amendments thereto, as if the employee is serving under a full-time appointment as an employee of the state educational institution and participating in the state health care benefits program to provide for such participation of the employee; (2) the amount of contributions required under subsection (1)(c) of Kan. Stat. Ann. § 74-4925, and amendments thereto; and (3) the amount required as contributions under subsection (2) of Kan. Stat. Ann. § 74-4927a, and amendments thereto. For each unclassified employee who has entered into a phased-retirement agreement with a state educational institution under this section, the compensation that the employee would have been entitled to receive based upon the employee’s percentage appointment immediately preceding entry into phased-retirement shall be utilized for the purposes of calculating all employer provided benefits, including but not limited to, compensation for accumulated sick leave, the insured death benefit and the insured disability benefit under Kan. Stat. Ann. § 74-4927, and amendments thereto, final average salary as defined in subsection (17) of Kan. Stat. Ann. § 74-4902, and amendments thereto, and retirement plan contributions under subsection (1)(c) of Kan. Stat. Ann. § 74-4925, and amendments thereto.

(b) For the purposes of this section, the term “unclassified employee” means an employee of a state educational institution, except health care employees, who is within the unclassified service under the Kansas civil service act, who is a participant in the retirement plan of the state board of regents, as provided in subsection (1)(a) of Kan. Stat. Ann. § 74-4925, and amendments thereto, and who meets minimum age and service requirements as determined and prescribed by the board of regents.