§233. Earnable compensation

A. The provisions of this Section shall apply to the following public retirement or pension systems, funds, and plans:

(1) Firefighters' Retirement System.

(2) Sheriffs' Pension and Relief Fund.

(3) Parochial Employees' Retirement System of Louisiana.

(4) Assessors Retirement Fund.

B.(1) Except as provided in Paragraph (4) of this Subsection, and without repealing comparable provisions contained within the individual laws governing retirement or pension systems, funds, and plans referenced in Subsection A hereof but superseding any such provisions which conflict with the provisions of this Section, for purposes of calculation of the amount of contributions payable by an employer and employee and for computation of average compensation, earnings or earned or earnable compensation, or its equivalent, shall mean the full amount earned by an employee for a given pay period.

(2) Earnings or earned or earnable compensation shall not include:

(a) Overtime unless it is required to be worked in the employee's regular tour of duty;

(b) Operating expenses;

(c) Use of automobile or motor vehicles;

(d) The cost of any insurance paid by the employer;

(e) Any allowance for expenses incurred as an incident of employment;

(f) Payments made in lieu of unused annual or sick leave; and

(g) Bonuses, terminal pay, severance pay, deferred salary, or any other type of irregular or nonrecurring payment.

(3) Notwithstanding the provisions of Subparagraph (2)(g) of this Subsection amounts deducted for deferred salary shall be included to calculate the amount of contributions payable by an employer and employee and to compute average compensation with respect to the Firefighters' Retirement System, the Sheriffs' Pension and Relief Fund, and the Parochial Employees' Retirement System of Louisiana.

(4)(a) To the extent there is a conflict between the provisions of this Subsection and R.S. 11:1902 as to "earnings", the provisions of R.S. 11:1902 shall prevail.

(b) To the extent there is a conflict between the provisions of this Subsection and R.S. 11:2252 as to "earnable compensation", the provisions of R.S. 11:2252 shall prevail.

C. Contributions required to be made by the employer shall not be considered as part of the employee's rate of pay or compensation.

D.(1) In addition to other applicable limitations set forth in the plan, and notwithstanding any other provision of the plan to the contrary, for plan years beginning on or after January 1, 1994, the annual compensation of each employee taken into account under the plan shall not exceed the annual compensation limit provided in Internal Revenue Code Section 401(a)(17), of one hundred fifty thousand dollars, as adjusted by the Commissioner of Internal Revenue for increases in the cost-of-living in accordance with Internal Revenue Code Section 401(a)(17)(B). The cost-of-living adjustment in effect for a calendar year applies to any period, not exceeding twelve months, over which compensation is determined (determination period) beginning in such calendar year. If a determination period consists of fewer than twelve months, the annual compensation limit provided in Internal Revenue Code Section 401(a)(17) will be multiplied by a fraction, the numerator of which is the number of months in the determination period, and the denominator of which is twelve.

(2)(a) For plan years beginning on or after January 1, 1994, any reference in this plan to the limitation under Internal Revenue Code Section 401(a)(17) shall mean the annual compensation limit of Internal Revenue Code Section 401(a)(17) as set forth in this Subsection.

(b) If the compensation for a prior determination period is taken into account in determining an employee's benefits accruing in the current plan year, the compensation for that prior determination period is subject to the annual compensation limit provided in Internal Revenue Code Section 401(a)(17) in effect for that prior determination period. For this purpose, for determination periods beginning before the first day of the first plan year beginning on or after January 1, 1994, the annual compensation limit provided in Internal Revenue Code Section 401(a)(17) is one hundred fifty thousand dollars.

(c) Effective for plan years beginning before January 1, 1997, the annual compensation limit provided in Internal Revenue Code Section 401(a)(17) shall apply in the aggregate to highly compensated employees and family members, and the allocation of compensation among such family members as spouses and children under age of nineteen years, shall be made in proportion to their compensation before the application of this Section, except that family members who are not eligible to participate in the plan, who participate but are not eligible to share in the benefit accrual because such persons are not members of the eligible class of employees or have completed fewer than the requisite number of hours of service or have terminated employment with the employer, shall not be allocated any portion of the Internal Revenue Code Section 401(a)(17) compensation limit for the year. The aggregation of compensation among family members shall not apply for plan years beginning on or after January 1, 1997.

Acts 1986, No. 1059, §1; Acts 1987, No. 911, §1; Redesignated from R.S. 42:710.2 by Acts 1991, No. 74, §3, eff. June 25, 1991; Acts 1997, No. 691, §1, eff. July 1, 1997; Acts 2006, No. 508, §1, eff. June 22, 2006; Acts 2008, No. 261, §1, eff. June 17, 2008.