(1) The rate of contribution of each active member of the system employed by the employer who is covered by such policy or agreement shall uniformly be six percent of salary regardless of the amount of monthly salary.

(2) The full amount of required employee contributions assumed or paid by the employer on behalf of its employees shall be considered "salary," as defined in ORS 238.005, only for the purpose of computing a member’s "final average salary," as defined in ORS 238.005, and shall not constitute additional "salary" or "other advantages," as defined in ORS 238.005, for any other purpose.

(3) The full amount of required employee contributions "picked-up" by the employer on behalf of its employees shall be considered "salary," as defined in ORS 238.005, for the purpose of calculating the amount of the contribution, for the purpose of computing a member’s "final average salary," as defined in ORS 238.005, and for all other purposes.

(4) The full amount of required employee contributions "picked-up," assumed or paid by the employer on behalf of its employees shall be added to the member accounts of the members for their annuities and shall be considered employee contributions for all other purposes of this chapter.

(5) For the purposes of this section:

(a) Employee contributions are "picked-up" if the written employment policy or agreement described in subsection (1) of this section provides that employee compensation will be reduced to generate the funds needed to make the employee contributions; and

(b) Employee contributions are "assumed or paid" by an employer if the written employment policy or agreement described in subsection (1) of this section provides that additional amounts shall be paid by the employer for the purpose of making the employee contributions, and employee compensation will not be reduced for the purpose of generating the funds needed to make the employee contributions.

(6) A participating public employer must give written notice to the Public Employees Retirement Board at the time that a written employment policy or agreement described in subsection (1) of this section is adopted or changed. The notice must indicate whether the employer will "pick-up" or "assume or pay" the employee contributions as described in subsection (5) of this section. Any change in the manner in which employee contributions are to be paid applies only to employee contributions made on and after the date the notice is received by the board. [Formerly 237.075; 1997 c.175 §8; 2001 c.945 §44; 2003 c.67 §2]