Wisconsin Act 10 - Implementation of WRS Contributions by Local Government Employees
2011-3/17 Dean R. Dietrich                                                               Printer Friendly PDF Version

A number of clients have contacted us with questions regarding the requirements in Wisconsin Act 10 relating to employee payment of contributions to the Wisconsin Retirement System. 

Please follow this link for a series of questions and answers that may help clarify the obligations of local government employees and local government employers regarding WRS contributions.

While it is clear that the new law will not become effective until March 28, 2011, the required contributions must start in the first full pay period that occurs after March 13, 2011.  For some employers, the pay period may start the next day, and for some employers, the pay period may not start until two weeks after March 13 when the next full pay period starts (March 27).  The exact pay period will depend upon your payroll system and how you have established pay periods.

There are questions as to whether the March 13 date should be changed because the law will not be effective until March 28.  While this is a subject of potential clarification, the legislation still references March 13 and has a provision that local government employers must collect the WRS contributions on or before July 1 if it cannot be implemented immediately in the first full pay period after March 13.  Based upon this consideration, we are of the opinion that the March 13 date is firm, even though the legislation does not become effective until March 28.

A number of questions have been asked about the exemption for employees who are subject to a collective bargaining agreement.  The language of the new law states the following:

The treatment of Sections… 40.05(1)(a)… and (b)… first apply to employees who are covered by a collective bargaining agreement that contains provisions inconsistent with those sections on the day on which the agreement expires or is terminated, extended, modified, or renewed, whichever occurs first.

This language allows the local government employer to not impose the WRS contribution until the day when a collective bargaining agreement expires or is terminated or is extended, modified, or renewed, whichever occurs first.  The definition of “collective bargaining agreement” is not clearly defined in this statutory provision.  There are open questions whether this provision would apply to different types of “agreements” that are provided to employees who are not subject to a requirement of collective bargaining under Section 111.70 (the Municipal Employment Relations Act).  This will depend on the manner in which the local government employer has treated the employees and is a very fact-specific determination. 

There is also a significant legal question as to whether this new legislation would be applicable to situations where an individual employee has an employment contract covering terms and conditions of employment with the local government employer.  Those situations must be addressed on a case-by-case basis depending upon the exact language in the individual employment contract and the circumstances surrounding the term of the individual employment contract.

We hope this information provides some clarification for our local government clients.  Ruder Ware is planning Special Briefings on Monday, March 21, at the Great Dane Pub & Brewing Co. in Wausau, and Thursday, March 24, at the Avalon Hotel & Conference Center in Chippewa Falls, starting at 6:00 p.m.  The Agenda for this presentation is very open-ended, so if you have questions about Wisconsin Act 10, you should attend this event.

For further information, please contact Attorney Dean Dietrich, who prepared this article, or any of the attorneys within the Local Governments and Municipalities Focus Group of Ruder Ware: Ron Rutlin, Jeff Jones, Mary Ellen Schill, or Christopher Toner.

© 2011 Ruder Ware, L.L.S.C. Accurate reproduction with acknowledgment granted. All rights reserved.
This document provides information of a general nature regarding legislative or other legal developments. None of the information contained herein is intended as legal advice or opinion relative to specific matters, facts, situations, or issues, and additional facts and information or future developments may affect the subjects addressed.