PERA-Includable Salary

You and your employer contribute a percentage of your monthly salary to your PERA Defined Benefit (DB) Plan account. State law defines the salary that is subject to PERA contributions in Section 24-51-101(42) of the Colorado Revised Statutes. PERA-includable salary is then used in determining your Highest Average Salary (HAS) for purposes of calculating your retirement benefit.

PERA-includable salary is compensation for services rendered to an employer and includes:

  • Regular salary or pay
  • Any pay for administrative, sabbatical, annual, sick, vacation, or personal leave
  • Pay for compensatory time or holidays
  • Payments by an employer from grants
  • Amounts deducted from pay pursuant to tax-sheltered savings or retirement programs
  • Amounts deducted from pay for a health savings account as defined in 26 U.S.C. Sec. 223, as amended, or any other type of retirement health savings account program
  • Performance or merit payments, if approved by the Board
  • Special pay for work-related injuries paid by the employer prior to termination of membership
  • Retroactive salary payments pursuant to court orders, arbitration awards, or litigation and grievance settlements

PERA-includable salary does not include:

  • Commissions
  • Compensation for unused sick leave converted at any time to cash payments
  • Compensation for unused sick, annual, vacation, administrative, or other accumulated paid leave contributed to a health savings account as defined in 26 U.S.C. Sec. 223, as amended, or a retirement health savings program
  • Housing allowances
  • Uniform allowances
  • Automobile usage
  • Insurance premiums
  • Dependent care assistance
  • Reimbursement for expenses incurred
  • Tuition or any other fringe benefits, regardless of federal taxation
  • Bonuses for services not actually rendered, including, but not limited to, early retirement inducements, Christmas bonuses, cash awards, honorariums and severance pay, damages, except for retroactive salary payments paid pursuant to court orders or arbitration awards or litigation and grievance settlements, or payments beyond the date of a member’s death.