Kentucky Statutes 78.540 – Membership — Cessation
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Membership in the system shall consist of the following:
(1) (a) All persons who become employees of a participating county after the date the county first participates in the system, except that:
1. Mayors and members of city legislative bodies may decline prior to their participation in the system; and
2. City managers or other appointed local government executives who participate in a retirement system, other than Social Security, may decline prior to their participation in the system;
(b) All persons who are employees of a county on the date the county first participates in the system, either in service or on authorized leave from service, and who elect within thirty (30) days next following the county’s participation, or in the case of persons on authorized leave, within thirty (30) days of their return to active service, to become members and thereby agree to make contributions as provided in KRS § 78.520 to
78.852;
(c) All persons who are employees of a county who did not elect to participate within thirty (30) days of the date the county first participated in the system or within thirty (30) days of their return to active service and who subsequently elect to participate the first day of a month after the county’s date of participation;
(d) All persons who declined participation as provided by paragraph (a) of this subsection and who later elect to participate. Persons who elect to participate under this paragraph may purchase service credit for any prior years in accordance with KRS § 61.552(5)(a), provided the person began participating in the system prior to January 1, 2014. The service shall not be included in the member’s total service for purposes of determining benefits under KRS § 78.5536; and
(e) All persons electing coverage in the system under KRS § 78.530(3)(d).
(2) The provisions of subsection (1)(a) to (c) of this section notwithstanding, cities which participate in the CERS and close existing local pension systems to new, or all members pursuant to the provisions of KRS § 78.530, 95.520, 95.621, or
95.852 shall not be required to provide membership in the County Employees Retirement System to employees in any employee category not covered by a city pension system at the date of participation.
(3) Membership in the system shall not include:
(a) Persons who are not eligible to participate in the system as provided by
KRS § 78.535; or
(b) Employees who are simultaneously participating in another state-administered defined benefit plan within Kentucky other than those administered by the Kentucky Retirement Systems or the County Employees Retirement System.
(4) (a) The membership of any person in the system shall cease:
1. Upon withdrawal of his or her accumulated account balance at or any time after termination of employment, regardless of length of
service;
2. Upon retirement;
3. Upon death;
4. For persons hired prior to August 1, 2000, upon termination of employment with prejudice, as defined by paragraph (b) of this subsection; or
5. For persons hired on or after August 1, 2000, upon conviction of a felony relating to the person’s employment as provided in paragraph (c) of this subsection.
(b) For purposes of KRS § 78.510 to KRS § 78.852, termination of employment with prejudice shall mean termination as the result of conviction of the member in a court of competent jurisdiction of embezzlement or larceny of public funds or property or malfeasance in office, or the forcing of a member to make restitution for any funds or property criminally taken by the member at the time of termination of employment.
(c) Notwithstanding any provision of law to the contrary, an employee hired on or after August 1, 2000, who participates in the system and who is convicted, in any state or federal court of competent jurisdiction, of a felony related to his or her employment shall forfeit rights and benefits earned under the system, except for the return of his or her accumulated contributions and interest credited on those contributions. The payment of retirement benefits ordered forfeited shall be stayed pending any appeal of the conviction. If the conviction is reversed on final judgment, no retirement benefit shall be forfeited. The employer shall notify the system when an employee is convicted under the provisions of this subsection.
(d) When membership ceases, except in the case of retirement, the member shall thereafter lose all right to any retirement allowance or benefits under KRS § 78.510 to KRS § 78.852 arising from service prior to the date of such cessation of membership.
Effective:April 1, 2021
History: Amended 2021 Ky. Acts ch. 102, sec. 19, effective April 1, 2021. — Amended 2020 Ky. Acts ch. 79, sec. 35, effective April 1, 2021. — Amended
2017 Ky. Acts ch. 32, sec. 18, effective June 29, 2017. — Amended 2015 Ky. Acts ch. 28, sec. 9, effective June 24, 2015. — Amended 2013 Ky. Acts ch. 120, sec. 74, effective July 1, 2013. — Amended 2004 Ky. Acts ch. 36, sec. 33, effective July 13, 2004. — Amended 2002 Ky. Acts ch. 270, sec. 2, effective April
9, 2002. — Amended 2000 Ky. Acts ch. 385, sec. 34, effective July 14, 2000. — Amended 1998 Ky. Acts ch. 105, sec. 22, effective July 15, 1998. — Amended
1994 Ky. Acts ch. 485, sec. 26, effective July 15, 1994. Amended 1992 Ky. Acts ch. 240, sec. 54, effective July 14, 1992. — Amended 1990 Ky. Acts ch.
222, sec. 6, effective July 13, 1990. — Amended 1988 Ky. Acts ch. 11, sec. 12, effective July 15, 1988; and ch. 349, sec. 33, effective July 15, 1988. — Amended 1986 Ky. Acts ch. 90, sec. 24. — Amended 1984 Ky. Acts ch. 177, sec. 12; and ch. 195, sec. 1. — Amended 1982 Ky. Acts ch. 423, sec. 16. — Amended 1976 Ky. Acts ch. 321, sec. 40. — Amended 1972 Ky. Acts ch. 116, sec. 63. — Amended 1964 Ky. Acts ch. 49, sec. 4. — Created 1958 Ky. Acts ch.
167, sec. 4.
(1) (a) All persons who become employees of a participating county after the date the county first participates in the system, except that:
Terms Used In Kentucky Statutes 78.540
- Appeal: A request made after a trial, asking another court (usually the court of appeals) to decide whether the trial was conducted properly. To make such a request is "to appeal" or "to take an appeal." One who appeals is called the appellant.
- City: includes town. See Kentucky Statutes 446.010
- Conviction: A judgement of guilt against a criminal defendant.
- Embezzlement: In most states, embezzlement is defined as theft/larceny of assets (money or property) by a person in a position of trust or responsibility over those assets. Embezzlement typically occurs in the employment and corporate settings. Source: OCC
- Federal: refers to the United States. See Kentucky Statutes 446.010
- Jurisdiction: (1) The legal authority of a court to hear and decide a case. Concurrent jurisdiction exists when two courts have simultaneous responsibility for the same case. (2) The geographic area over which the court has authority to decide cases.
- Month: means calendar month. See Kentucky Statutes 446.010
- public funds: means sums actually received in cash or negotiable instruments from all sources unless otherwise described by any state agency, state- owned corporation, university, department, cabinet, fiduciary for the benefit of any form of state organization, authority, board, bureau, interstate compact, commission, committee, conference, council, office, or any other form of organization whether or not the money has ever been paid into the Treasury and whether or not the money is still in the Treasury if the money is controlled by any form of state organization, except for those funds the management of which is to be reported to the Legislative Research Commission pursuant to KRS §. See Kentucky Statutes 446.010
- Restitution: The court-ordered payment of money by the defendant to the victim for damages caused by the criminal action.
- State: when applied to a part of the United States, includes territories, outlying possessions, and the District of Columbia. See Kentucky Statutes 446.010
1. Mayors and members of city legislative bodies may decline prior to their participation in the system; and
2. City managers or other appointed local government executives who participate in a retirement system, other than Social Security, may decline prior to their participation in the system;
(b) All persons who are employees of a county on the date the county first participates in the system, either in service or on authorized leave from service, and who elect within thirty (30) days next following the county’s participation, or in the case of persons on authorized leave, within thirty (30) days of their return to active service, to become members and thereby agree to make contributions as provided in KRS § 78.520 to
78.852;
(c) All persons who are employees of a county who did not elect to participate within thirty (30) days of the date the county first participated in the system or within thirty (30) days of their return to active service and who subsequently elect to participate the first day of a month after the county’s date of participation;
(d) All persons who declined participation as provided by paragraph (a) of this subsection and who later elect to participate. Persons who elect to participate under this paragraph may purchase service credit for any prior years in accordance with KRS § 61.552(5)(a), provided the person began participating in the system prior to January 1, 2014. The service shall not be included in the member’s total service for purposes of determining benefits under KRS § 78.5536; and
(e) All persons electing coverage in the system under KRS § 78.530(3)(d).
(2) The provisions of subsection (1)(a) to (c) of this section notwithstanding, cities which participate in the CERS and close existing local pension systems to new, or all members pursuant to the provisions of KRS § 78.530, 95.520, 95.621, or
95.852 shall not be required to provide membership in the County Employees Retirement System to employees in any employee category not covered by a city pension system at the date of participation.
(3) Membership in the system shall not include:
(a) Persons who are not eligible to participate in the system as provided by
KRS § 78.535; or
(b) Employees who are simultaneously participating in another state-administered defined benefit plan within Kentucky other than those administered by the Kentucky Retirement Systems or the County Employees Retirement System.
(4) (a) The membership of any person in the system shall cease:
1. Upon withdrawal of his or her accumulated account balance at or any time after termination of employment, regardless of length of
service;
2. Upon retirement;
3. Upon death;
4. For persons hired prior to August 1, 2000, upon termination of employment with prejudice, as defined by paragraph (b) of this subsection; or
5. For persons hired on or after August 1, 2000, upon conviction of a felony relating to the person’s employment as provided in paragraph (c) of this subsection.
(b) For purposes of KRS § 78.510 to KRS § 78.852, termination of employment with prejudice shall mean termination as the result of conviction of the member in a court of competent jurisdiction of embezzlement or larceny of public funds or property or malfeasance in office, or the forcing of a member to make restitution for any funds or property criminally taken by the member at the time of termination of employment.
(c) Notwithstanding any provision of law to the contrary, an employee hired on or after August 1, 2000, who participates in the system and who is convicted, in any state or federal court of competent jurisdiction, of a felony related to his or her employment shall forfeit rights and benefits earned under the system, except for the return of his or her accumulated contributions and interest credited on those contributions. The payment of retirement benefits ordered forfeited shall be stayed pending any appeal of the conviction. If the conviction is reversed on final judgment, no retirement benefit shall be forfeited. The employer shall notify the system when an employee is convicted under the provisions of this subsection.
(d) When membership ceases, except in the case of retirement, the member shall thereafter lose all right to any retirement allowance or benefits under KRS § 78.510 to KRS § 78.852 arising from service prior to the date of such cessation of membership.
Effective:April 1, 2021
History: Amended 2021 Ky. Acts ch. 102, sec. 19, effective April 1, 2021. — Amended 2020 Ky. Acts ch. 79, sec. 35, effective April 1, 2021. — Amended
2017 Ky. Acts ch. 32, sec. 18, effective June 29, 2017. — Amended 2015 Ky. Acts ch. 28, sec. 9, effective June 24, 2015. — Amended 2013 Ky. Acts ch. 120, sec. 74, effective July 1, 2013. — Amended 2004 Ky. Acts ch. 36, sec. 33, effective July 13, 2004. — Amended 2002 Ky. Acts ch. 270, sec. 2, effective April
9, 2002. — Amended 2000 Ky. Acts ch. 385, sec. 34, effective July 14, 2000. — Amended 1998 Ky. Acts ch. 105, sec. 22, effective July 15, 1998. — Amended
1994 Ky. Acts ch. 485, sec. 26, effective July 15, 1994. Amended 1992 Ky. Acts ch. 240, sec. 54, effective July 14, 1992. — Amended 1990 Ky. Acts ch.
222, sec. 6, effective July 13, 1990. — Amended 1988 Ky. Acts ch. 11, sec. 12, effective July 15, 1988; and ch. 349, sec. 33, effective July 15, 1988. — Amended 1986 Ky. Acts ch. 90, sec. 24. — Amended 1984 Ky. Acts ch. 177, sec. 12; and ch. 195, sec. 1. — Amended 1982 Ky. Acts ch. 423, sec. 16. — Amended 1976 Ky. Acts ch. 321, sec. 40. — Amended 1972 Ky. Acts ch. 116, sec. 63. — Amended 1964 Ky. Acts ch. 49, sec. 4. — Created 1958 Ky. Acts ch.
167, sec. 4.