A new rule for retirement plans could have negative effects on the City of Athens’ part-time workforce, causing concern for some city officials.
The many departments within the City of Athens umbrella recently met to discuss budgets for fiscal year 2021 at City Hall. During the meeting, Cemetery, Parks and Recreation Director Bert Bradford highlighted the potential issue beginning next month that could affect the department’s part-time workforce.
According to City Clerk Annette Threet, the Retirement Systems of Alabama is implementing a new rule that any part-time employee who has been with one employer for a cumulative 12 months or more must have 6% of each paycheck taken out in order to join the company’s retirement plan.
Threet said not only can employees not opt out, tracking the number of months a part-timer has worked, especially in non-consecutive months across multiple years, will be a “nightmare.”
“We’ve got a lot of part-time people, and effective Oct. 1, 2020, they will have to start participating in the retirement plan,” she said.
Threet said the city will have to pay its portion into these retirement plans as well, with the exact percentage depending on whether the employee is Tier 1 or Tier 2. She said most part-time employees would be Tier 2, so the city would have to contribute 8.81% to the new retirement plans.
Bradford said the city’s parks and rec department relies “heavily” on part-time and temporary workers. He voiced his concern that the deduction from each paycheck could lead to the department losing many of its part-time employees, some of which have been on the books for multiple years.
“We have kids that started at 16 (years old) in our rec program, that come back every year and may even work for us through college,” he said. “That helps because they require less training (each year) and they can help run programs.”
Threet and Bradford discussed some potential solutions to the issue during the meeting, such as raising base pay for part-time workers, but a permanent answer will still need to be researched and implemented.
Bradford said the new Athens Rec Center is already making an impact on both the department and the city as a whole. He said some large groups have already contacted him about hosting events, including travel volleyball and basketball tournaments, at the facility.
Bradford said the parks and recreation department used to be “fairly seasonal,” but the new rec center will change that, as it will be used year-round. He said there are currently 43 fitness classes with contracted instructors offered each week at the rec center, and more than 5,000 people have already been scanned into the building at least once.
Bradford told the City Council that he would like to add three full-time employees to his budget for FY 2021. Threet said this would include a new recreation coordinator and two equipment operators.
Bradford said the 2020 spring season was set to be the busiest for the parks and recreation department that he had seen in his position. However, due to COVID-19 canceling all sports earlier this year, his department was able to instead go down a list and catch up on many items that needed attending, such as painting curbs, pressure washing areas, repairs and ground maintenance.