Sick leave is an important fringe benefit available to State of Wisconsin employees and employees of certain public authorities. Most employees earn and, depending on usage, will accumulate hours of unused sick leave while they are employed with the state or certain public authorities.
Upon retirement (regular or disability), layoff or death, eligible employees can use their unused sick leave credits to pay post-termination state group health insurance premiums for themselves and their spouse and/or dependents. The employer should verify the employee is covered under the State Group Health Insurance plan (not the Wisconsin Public Employers (local) health insurance plan) prior to retirement to be eligible for their sick leave hours.
The Department of Employee Trust Funds requires that employers submit sick leave certifications to ETF within 30 days of receiving an employee’s termination or retirement. This deadline provides time for you to finalize the employee’s remaining sick leave hours. For Accumulated Sick Leave Conversion Credit Program details, see Chapter 12 of the State Agency Health Insurance Standards, Guidelines, and Administration Employer Manual (ET-1118).
Health insurance coverage and deadlines are governed by state statutes and it’s extremely important that employee benefits are not put at risk because of a failure to provide sick leave certification information.
Follow these steps when submitting the sick leave certification:
Employee is Over Minimum Retirement Age
When an employee terminates employment and is over the minimum retirement age (MRA), you should:
- Encourage the employee to visit etf.wi.gov and submit a request for a retirement estimate, and/or schedule an appointment, or contact ETF for a retirement estimate, appointment, or general retirement information.
- Refer to and complete the Termination Checklist for Retiring State Employees (ET-2500).
- Regardless of whether the employee indicates they are taking their retirement benefit, submit the accumulated sick leave hours through the AcSL system and enter “retirement” as the termination reason.
After the sick leave hours have been converted to a sick leave account for health insurance payments, the employee must then determine what they want to do with their sick leave account.
- An employee who qualifies for sick leave conversion by taking an immediate annuity may either use their credits to pay for health insurance or escrow (save) those credits for later use.
- An employee who has more than 20 years of Wisconsin Retirement System-creditable service may defer their annuity and either use their credits immediately or escrow them.
Employee is Under Minimum Retirement Age
When an employee terminates employment and is under the minimum retirement age (MRA), you should:
- Refer to and complete the Termination Checklist for State Employees (ET-2500s).
- If the employee has fewer than 20 years of WRS-creditable service, review the Sick Leave Transfer Between WRS Agencies chart if the employee is going to other WRS employment. The chart shows which entities accept the transfer of sick leave and which do not. The employee is responsible for verifying information with their current and future agency to determine if their sick leave hours will transfer.
- If the employee has 20 or more years of WRS-creditable service or is an eligible public official, submit a sick leave certification on the AcSL system. The sick leave for these employees is preserved to use when they apply for their retirement annuity.
Note: The Sick Leave Transfer Between WRS Agencies chart is being provided based on information received by ETF from these employers. ETF does not control how or whether sick leave is transferred between state authorities, the UW system, and state employers. Employers and employees should communicate with each other about whether their sick leave may or may not transfer.