Overtime and Your FAC

Any overtime pay you receive as a state employee in the DB plan may be used in your FAC calculation.

  • If the FAC time period ended before January 1, 2012, the actual overtime you earned each year would be included in your FAC.
  • If your highest three years of earnings (FAC period) starts on or after January 1, 2012, an average of any overtime you earned since January 1, 2009, will be added to your annual earnings.
  • If your highest three years of earnings spans January 1, 2012, wages used in your FAC from before January 1, 2012, will include the actual overtime earned during that time period, but any wages after January 1, 2012, will include a prorated amount equal to the average of your overtime earned since January 1, 2009.
  • After January 1, 2015, the average overtime earnings will be based on overtime earned for the six years immediately before the end of the FAC period.

If you qualify for supplemental pay until age 62, that calculation is made after your initial pension amount is determined.

If your annual overtime earnings are relatively stable from year to year up to the time you retire, there will be little impact on your pension calculation. However, if your overtime earnings are very high for a few years, then very low for a long stretch, you may find that total income earned for a three-year period before January 1, 2012, may give you a higher pension amount.

View the tutorial and read the handout for further information on overtime as well as some examples of how overtime earnings might influence the FAC period.