2010 California Code
Government Code
Chapter 7. Compensation

20630.  (a) As used in this part, "compensation" means the
remuneration paid out of funds controlled by the employer in payment
for the member's services performed during normal working hours or
for time during which the member is excused from work because of any
of the following:
   (1) Holidays.
   (2) Sick leave.
   (3) Industrial disability leave, during which, benefits are
payable pursuant to Sections 4800 and 4850 of the Labor Code, Article
4 (commencing with Section 19869) of Chapter 2.5 of Part 2.6, or
Section 44043 or 87042 of the Education Code.
   (4) Vacation.
   (5) Compensatory time off.
   (6) Leave of absence.
   (b) When compensation is reported to the board, the employer shall
identify the pay period in which the compensation was earned
regardless of when reported or paid. Compensation shall be reported
in accordance with Section 20636 and shall not exceed compensation
earnable, as defined in Section 20636.



20631.  A contracting agency may report an amount for each member
that is equal to a uniformly applied percentage of salary in lieu of
computing and reporting the actual compensation attributable to each
individual member if the contracting agency has agreed in a
memorandum of understanding reached pursuant to Chapter 10
(commencing with Section 3500) of Division 4 of Title 1 that the
aggregate amount to be reported by the contracting agency for all
members within a membership classification bears a reasonable
relation to the aggregate amount that would otherwise be required to
be reported pursuant to Section 20636.



20632.  For state employees in classifications designated by the
Director of the Department of Personnel Administration who are also
excluded from, or otherwise not subject to, collective bargaining,
and for employees in bargaining units for which a memorandum of
understanding has been agreed to by the state employer and the
recognized employee organization to become subject to this section,
compensation for uniforms shall not constitute "compensation" for the
purposes of the computation of retirement contributions by employees
and the state or for the purposes of the calculation of retirement
benefits.


20633.  Notwithstanding any other provision of this part,
compensation includes salary withheld by the employer in accordance
with Section 45165 or 88164 of the Education Code, which provide for
continuation of salary payments during a period in which the member
renders no service. The withheld salary shall be reported as earned.




20634.  For a university member appointed under a health sciences
compensation plan of the university, "compensation" shall not include
past or future supplemental payments made pursuant to any health
sciences compensation plan.


20635.  When the compensation of a member is a factor in any
computation to be made under this part, there shall be excluded from
those computations any compensation based on overtime put in by a
member whose service retirement allowance is a fixed percentage of
final compensation for each year of credited service. For the
purposes of this part, overtime is the aggregate service performed by
an employee as a member for all employers and in all categories of
employment in excess of the hours of work considered normal for
employees on a full-time basis, and for which monetary compensation
is paid.
   If a member concurrently renders service in two or more positions,
one or more of which is full time, service in the part-time position
shall constitute overtime. If two or more positions are permanent
and full time, the position with the highest payrate or base pay
shall be reported to this system. This provision shall apply only to
service rendered on or after July 1, 1994.



20635.1.  Notwithstanding Section 20635, and Section 45102 of the
Education Code, when the compensation of a school member is a factor
in any computation to be made under this part, there shall be
excluded from those computations any compensation based on overtime
put in by a member whose service retirement allowance is a fixed
percentage of final compensation for each year of credited service.
For the purposes of this part, overtime for school members is the
aggregate service performed by an employee as a member for all school
employers and in all categories of employment in excess of 40 hours
of work per week, and for which monetary compensation is paid.
   If a school member concurrently renders service in two or more
positions, one or more of which is full time, service in the
part-time position shall constitute overtime. If two or more
positions are permanent and full time, the position with the highest
payrate or base pay shall be reported to this system.



20636.  (a) "Compensation earnable" by a member means the payrate
and special compensation of the member, as defined by subdivisions
(b), (c), and (g), and as limited by Section 21752.5.
   (b) (1) "Payrate" means the normal monthly rate of pay or base pay
of the member paid in cash to similarly situated members of the same
group or class of employment for services rendered on a full-time
basis during normal working hours, pursuant to publicly available pay
schedules. "Payrate," for a member who is not in a group or class,
means the monthly rate of pay or base pay of the member, paid in cash
and pursuant to publicly available pay schedules, for services
rendered on a full-time basis during normal working hours, subject to
the limitations of paragraph (2) of subdivision (e).
   (2) "Payrate" shall include an amount deducted from a member's
salary for any of the following:
   (A) Participation in a deferred compensation plan.
   (B) Payment for participation in a retirement plan that meets the
requirements of Section 401(k) of Title 26 of the United States Code.
   (C) Payment into a money purchase pension plan and trust that
meets the requirements of Section 401(a) of Title 26 of the United
States Code.
   (D) Participation in a flexible benefits program.
   (3) The computation for a leave without pay of a member shall be
based on the compensation earnable by him or her at the beginning of
the absence.
   (4) The computation for time prior to entering state service shall
be based on the compensation earnable by him or her in the position
first held by him or her in state service.
   (c) (1) Special compensation of a member includes a payment
received for special skills, knowledge, abilities, work assignment,
workdays or hours, or other work conditions.
   (2) Special compensation shall be limited to that which is
received by a member pursuant to a labor policy or agreement or as
otherwise required by state or federal law, to similarly situated
members of a group or class of employment that is in addition to
payrate. If an individual is not part of a group or class, special
compensation shall be limited to that which the board determines is
received by similarly situated members in the closest related group
or class that is in addition to payrate, subject to the limitations
of paragraph (2) of subdivision (e).
   (3) Special compensation shall be for services rendered during
normal working hours and, when reported to the board, the employer
shall identify the pay period in which the special compensation was
earned.
   (4) Special compensation may include the full monetary value of
normal contributions paid to the board by the employer, on behalf of
the member and pursuant to Section 20691, if the employer's labor
policy or agreement specifically provides for the inclusion of the
normal contribution payment in compensation earnable.
   (5) The monetary value of a service or noncash advantage furnished
by the employer to the member, except as expressly and specifically
provided in this part, is not special compensation unless regulations
promulgated by the board specifically determine that value to be
"special compensation."
   (6) The board shall promulgate regulations that delineate more
specifically and exclusively what constitutes "special compensation"
as used in this section. A uniform allowance, the monetary value of
employer-provided uniforms, holiday pay, and premium pay for hours
worked within the normally scheduled or regular working hours that
are in excess of the statutory maximum workweek or work period
applicable to the employee under Section 201 et seq. of Title 29 of
the United States Code shall be included as special compensation and
appropriately defined in those regulations.
   (7) Special compensation does not include any of the following:
   (A) Final settlement pay.
   (B) Payments made for additional services rendered outside of
normal working hours, whether paid in lump sum or otherwise.
   (C) Other payments the board has not affirmatively determined to
be special compensation.
   (d) Notwithstanding any other provision of law, payrate and
special compensation schedules, ordinances, or similar documents
shall be public records available for public scrutiny.
   (e) (1) As used in this part, "group or class of employment" means
a number of employees considered together because they share
similarities in job duties, work location, collective bargaining
unit, or other logical work-related grouping. One employee may not be
considered a group or class.
   (2) Increases in compensation earnable granted to an employee who
is not in a group or class shall be limited during the final
compensation period applicable to the employees, as well as the two
years immediately preceding the final compensation period, to the
average increase in compensation earnable during the same period
reported by the employer for all employees who are in the same
membership classification, except as may otherwise be determined
pursuant to regulations adopted by the board that establish
reasonable standards for granting exceptions.
   (f) As used in this part, "final settlement pay" means pay or cash
conversions of employee benefits that are in excess of compensation
earnable, that are granted or awarded to a member in connection with,
or in anticipation of, a separation from employment. The board shall
promulgate regulations that delineate more specifically what
constitutes final settlement pay.
   (g) (1) Notwithstanding subdivision (a), "compensation earnable"
for state members means the average monthly compensation, as
determined by the board, upon the basis of the average time put in by
members in the same group or class of employment and at the same
rate of pay, and is composed of the payrate and special compensation
of the member. The computation for an absence of a member shall be
based on the compensation earnable by him or her at the beginning of
the absence and for time prior to entering state service shall be
based on the compensation earnable by him or her in the position
first held by him or her in that state service.
   (2) Notwithstanding subdivision (b), "payrate" for state members
means the average monthly remuneration paid in cash out of funds paid
by the employer to similarly situated members of the same group or
class of employment, in payment for the member's services or for time
during which the member is excused from work because of holidays,
sick leave, vacation, compensating time off, or leave of absence.
"Payrate" for state members shall include:
   (A) An amount deducted from a member's salary for any of the
following:
   (i) Participation in a deferred compensation plan established
pursuant to Chapter 4 (commencing with Section 19993) of Part 2.6.
   (ii) Payment for participation in a retirement plan that meets the
requirements of Section 401(k) of Title 26 of the United States
Code.
   (iii) Payment into a money purchase pension plan and trust that
meets the requirements of Section 401(a) of Title 26 of the United
States Code.
   (iv) Participation in a flexible benefits program.
   (B) A payment in cash by the member's employer to one other than
an employee for the purpose of purchasing an annuity contract for a
member under an annuity plan that meets the requirements of Section
403(b) of Title 26 of the United States Code.
   (C) Employer "pick up" of member contributions that meets the
requirements of Section 414(h)(2) of Title 26 of the United States
Code.
   (D) Disability or workers' compensation payments to safety members
in accordance with Section 4800 of the Labor Code.
   (E) Temporary industrial disability payments pursuant to Article 4
(commencing with Section 19869) of Chapter 2.5 of Part 2.6.
   (F) Other payments the board may determine to be within "payrate."
   (3) Notwithstanding subdivision (c), "special compensation" for
state members shall mean all of the following:
   (A) The monetary value, as determined by the board, of living
quarters, board, lodging, fuel, laundry, and other advantages of any
nature furnished to a member by his or her employer in payment for
the member's services.
   (B) Compensation for performing normally required duties, such as
holiday pay, bonuses (for duties performed on regular work shift),
educational incentive pay, maintenance and noncash payments,
out-of-class pay, marksmanship pay, hazard pay, motorcycle pay,
paramedic pay, emergency medical technician pay, Peace Officer
Standards and Training (POST) certificate pay, and split shift
differential.
   (C) Compensation for uniforms, except as provided in Section
20632.
   (D) Other payments the board may determine to be within "special
compensation."
   (4) "Payrate" and "special compensation" for state members do not
include any of the following:
   (A) The provision by the state employer of a medical or hospital
service or care plan or insurance plan for its employees (other than
the purchase of annuity contracts as described below in this
subdivision), a contribution by the employer to meet the premium or
charge for that plan, or a payment into a private fund to provide
health and welfare benefits for employees.
   (B) A payment by the state employer of the employee portion of
taxes imposed by the Federal Insurance Contribution Act.
   (C) Amounts not available for payment of salaries and that are
applied by the employer for the purchase of annuity contracts
including those that meet the requirements of Section 403(b) of Title
26 of the United States Code.
   (D) Benefits paid pursuant to Article 5 (commencing with Section
19878) of Chapter 2.5 of Part 2.6.
   (E) Employer payments that are to be credited as employee
contributions for benefits provided by this system, or employer
payments that are to be credited to employee accounts in deferred
compensation plans. The amounts deducted from a member's wages for
participation in a deferred compensation plan may not be considered
to be "employer payments."
   (F) Payments for unused vacation, annual leave, personal leave,
sick leave, or compensating time off, whether paid in lump sum or
otherwise.
   (G) Final settlement pay.
   (H) Payments for overtime, including pay in lieu of vacation or
holiday.
   (I) Compensation for additional services outside regular duties,
such as standby pay, callback pay, court duty, allowance for
automobiles, and bonuses for duties performed after the member's
regular work shift.
   (J) Amounts not available for payment of salaries and that are
applied by the employer for any of the following:
   (i) The purchase of a retirement plan that meets the requirements
of Section 401(k) of Title 26 of the United States Code.
   (ii) Payment into a money purchase pension plan and trust that
meets the requirements of Section 401(a) of Title 26 of the United
States Code.
   (K) Payments made by the employer to or on behalf of its employees
who have elected to be covered by a flexible benefits program, where
those payments reflect amounts that exceed the employee's salary.
   (L) Other payments the board may determine are not "payrate" or
"special compensation."
   (5) If the provisions of this subdivision, including the board's
determinations pursuant to subparagraph (F) of paragraph (2) and
subparagraph (D) of paragraph (3), are in conflict with the
provisions of a memorandum of understanding reached pursuant to
Section 3517.5 or 3560, the memorandum of understanding shall be
controlling without further legislative action, except that if the
provisions of a memorandum of understanding require the expenditure
of funds, those provisions may not become effective unless approved
by the Legislature in the annual Budget Act. No memorandum of
understanding reached pursuant to Section 3517.5 or 3560 may exclude
from the definition of either "payrate" or "special compensation" a
member's base salary payments or payments for time during which the
member is excused from work because of holidays, sick leave,
vacation, compensating time off, or leave of absence. If items of
compensation earnable are included by memorandum of understanding as
"payrate" or "special compensation" for retirement purposes for
represented and higher education employees pursuant to this
paragraph, the Department of Personnel Administration or the Trustees
of the California State University shall obtain approval from the
board for that inclusion.
   (6) (A) Subparagraph (B) of paragraph (3) prescribes that
compensation earnable includes compensation for performing normally
required duties, such as holiday pay, bonuses (for duties performed
on regular work shift), educational incentive pay, maintenance and
noncash payments, out-of-class pay, marksmanship pay, hazard pay,
motorcycle pay, paramedic pay, emergency medical technician pay, POST
certificate pay, and split shift differential; and includes
compensation for uniforms, except as provided in Section 20632; and
subparagraph (I) of paragraph (4) excludes from compensation earnable
compensation for additional services outside regular duties, such as
standby pay, callback pay, court duty, allowance for automobile, and
bonuses for duties performed after regular work shift.
   (B) Notwithstanding subparagraph (A), the Department of Personnel
Administration shall determine which payments and allowances that are
paid by the state employer shall be considered compensation for
retirement purposes for an employee who either is excluded from the
definition of state employee in Section 3513, or is a nonelected
officer or employee of the executive branch of government who is not
a member of the civil service.
   (C) Notwithstanding subparagraph (A), the Trustees of the
California State University shall determine which payments and
allowances that are paid by the trustees shall be considered
compensation for retirement purposes for a managerial employee, as
defined in Section 3562, or supervisory employee as defined in
Section 3580.3.


20636.1.  (a) Notwithstanding Section 20636, and Section 45102 of
the Education Code, "compensation earnable" by a school member means
the payrate and special compensation of the member, as defined by
subdivisions (b) and (c), and as limited by Section 21752.5.
   (b) (1) "Payrate" means the normal monthly rate of pay or base pay
of the member paid in cash to similarly situated members of the same
group or class of employment for services rendered on a full-time
basis during normal working hours. For purposes of this part, for
classified members, full-time employment is 40 hours per week, and
payments for services rendered, not to exceed 40 hours per week,
shall be reported as compensation earnable for all months of the year
in which work is performed. "Payrate," for a member who is not in a
group or class, means the monthly rate of pay or base pay of the
member, paid in cash and pursuant to publicly available pay
schedules, for services rendered on a full-time basis during normal
working hours, subject to the limitations of paragraph (2) of
subdivision (e).
   (A) For the purposes of this section, "classified members" shall
mean members who retain membership under this system while employed
with a school employer in positions not subject to coverage under the
Defined Benefit Program under the State Teacher's Retirement System.
   (B) For the purposes of this section, and Sections 20962 and
20966, "certificated members" shall mean members who retain
membership under this system while employed in positions subject to
coverage under the Defined Benefit Program under the State Teacher's
Retirement System.
   (2) The computation for any leave without pay of a member shall be
based on the compensation earnable by him or her at the beginning of
the absence.
   (3) The computation for time prior to entering state service shall
be based on the compensation earnable by him or her in the position
first held by him or her in state service.
   (c) (1) Special compensation of a school member includes any
payment received for special skills, knowledge, abilities, work
assignment, workdays or hours, or other work conditions.
   (2) Special compensation shall be limited to that which is
received by a member pursuant to a labor policy or agreement or as
otherwise required by state or federal law, to similarly situated
members of a group or class of employment that is in addition to
payrate. If an individual is not part of a group or class, special
compensation shall be limited to that which the board determines is
received by similarly situated members in the closest related group
or class that is in addition to payrate, subject to the limitations
of paragraph (2) of subdivision (e).
   (3) Special compensation shall be for services rendered during
normal working hours and, when reported to the board, the employer
shall identify the pay period in which the special compensation was
earned.
   (4) Special compensation may include the full monetary value of
normal contributions paid to the board by the employer, on behalf of
the member and pursuant to Section 20691, provided that the employer'
s labor policy or agreement specifically provides for the inclusion
of the normal contribution payment in compensation earnable.
   (5) The monetary value of any service or noncash advantage
furnished by the employer to the member, except as expressly and
specifically provided in this part, shall not be special compensation
unless regulations promulgated by the board specifically determine
that value to be "special compensation."
   (6) The board shall promulgate regulations that delineate more
specifically and exclusively what constitutes "special compensation"
as used in this section. A uniform allowance, the monetary value of
employer-provided uniforms, holiday pay, and premium pay for hours
worked within the normally scheduled or regular working hours that
are in excess of the statutory maximum workweek or work period
applicable to the employee under Section 201 et seq. of Title 29 of
the United States Code shall be included as special compensation and
appropriately defined in those regulations.
   (7) Special compensation does not include any of the following:
   (A) Final settlement pay.
   (B) Payments made for additional services rendered outside of
normal working hours, whether paid in lump sum or otherwise.
   (C) Any other payments the board has not affirmatively determined
to be special compensation.
   (d) Notwithstanding any other provision of law, payrate and
special compensation schedules, ordinances, or similar documents
shall be public records available for public scrutiny.
   (e) (1) As used in this part, "group or class of employment" means
a number of employees considered together because they share
similarities in job duties, work location, collective bargaining
unit, or other logical work-related grouping. Under no circumstances
shall one employee be considered a group or class.
   (2) Increases in compensation earnable granted to any employee who
is not in a group or class shall be limited during the final
compensation period applicable to the employees, as well as the two
years immediately preceding the final compensation period, to the
average increase in compensation earnable during the same period
reported by the employer for all employees who are in the same
membership classification, except as may otherwise be determined
pursuant to regulations adopted by the board that establish
reasonable standards for granting exceptions.
   (f) As used in this part, "final settlement pay" means any pay or
cash conversions of employee benefits that are in excess of
compensation earnable, that are granted or awarded to a member in
connection with or in anticipation of a separation from employment.
The board shall promulgate regulations that delineate more
specifically what constitutes final settlement pay.



20637.  "Compensation earnable," with respect to a state member
receiving supplemental payments pursuant to Section 21160 at the time
of retirement or death, means the highest average monthly
compensation paid to the employee in the classification in which the
member was employed at time of becoming eligible for benefits
pursuant to Section 21160, or the average compensation earnable by
the member at time of retirement or death, whichever is higher.



20638.  The average monthly salary during any period of service as a
member of a county retirement system shall be considered
compensation earnable by a member of this system for purposes of
computing final compensation for the member provided:
   (a) (1) Entry into employment in which he or she became a member
in one system occurred on or after October 1, 1957, and within 90
days of discontinuance of employment as a member of the other system.
   (2) This subdivision shall not deny the benefit of this section to
any person retiring after October 1, 1963, who entered membership
prior to October 1, 1957, if he or she entered the employment in
which he or she became a member within 90 days of termination of
employment in which he or she was a member of the other system, and
he or she became a member within seven months of entry into
employment, or, if an employee of a district as defined in Section
31468, became a member at the time the district was included in a
county retirement system .
   (b) He or she retires concurrently under both systems and is
credited with the period of service under the county system at the
time of retirement.



20639.  The compensation earnable during any period of service as a
member of the Judges' Retirement System, the Judges' Retirement
System II, the Legislators' Retirement System, or the Defined Benefit
Program of the State Teachers' Retirement Plan shall be considered
compensation earnable as a member of this system for purposes of
computing final compensation for the member, if he or she retires
concurrently under both systems.
   A member shall be deemed to have retired concurrently under this
system and under the Defined Benefit Program of the State Teachers'
Retirement Plan, if the member is enrolled as a disabled member under
the Defined Benefit Program of the State Teachers' Retirement Plan
and for retirement under this system on the same effective date.