Defined benefit vesting is the minimum length of service members need to qualify for a future retirement benefit. Members are vested under the defined benefit component of the Hybrid Retirement Plan when they reach five years (60 months) of service credit. VRS Plan 1 or VRS Plan 2 members with at least five years (60 months) of service credit who opt into the Hybrid Retirement Plan will stay vested.

Defined contribution vesting is the minimum length of service members need to be eligible to withdraw employer contributions from the defined contribution component of the plan. Members are always 100% vested in the contributions that they make.

Upon retirement or leaving covered employment, members are eligible to withdraw a percentage of employer contributions. Distribution is not required by law until age 73.

• After two years, members are 50% vested and may withdraw 50% of employer contributions.
• After three years, members are 75% vested and may withdraw 75% of employer contributions.
• After four or more years, members are 100% vested and may withdraw 100% of employer contributions.

Same as in VRS Plan 2, it is used in the retirement formula in the defined benefit component of the plan.

A retirement multiplier is a factor that determines how much a member’s average final compensation will be used to calculate the defined benefit component of their retirement benefit. The member retirement multiplier is 1.0% on any service earned, purchased or granted while a hybrid member.

If a member opted into the Hybrid Retirement Plan from VRS Plan 1 or VRS Plan 2, the applicable multipliers for those plans will be used to calculate their retirement benefit for service earned, purchased or granted while a member of those plans.

Eligible political subdivision and school division members (including opt-ins) will participate in the Virginia Local Disability Program (VLDP) unless their local governing body provides an employer-paid comparable plan for members.

State employees (including opt-ins) in the Hybrid Retirement Plan will be covered under the Virginia Sickness and Disability Program (VSDP). State employees (with the exception of Judicial Retirement Plan members) participating in the Hybrid Retirement Plan will not be eligible for disability retirement.

Members opting into the Hybrid Retirement Plan and covered under VSDP or VLDP will be subject to a one-year waiting period before becoming eligible for non-work related disability benefits. Current VSDP participants opting in with one year of employment will not have a waiting period.

Under the defined benefit component of the plan, service credit includes active service. Members earn service credit for each month they are employed in a covered position. It may also include credit for prior service members may have purchased or additional service credit they were granted. A member’s total service credit is one of the factors used to determine their eligibility for retirement and to calculate their retirement benefit. It may also count toward eligibility for the health insurance credit in retirement, if their employer offers the health insurance credit.

Under the defined contribution component, service credit is used to determine vesting for the employer contribution portion of the plan.

Members may be able to purchase service from previous public employment, active duty military service, an eligible period of leave or VRS refunded service as service credit in their plan. Prior service credit counts toward vesting, eligibility for retirement and the health insurance credit. Only active members are eligible to purchase prior service. Members may also be eligible to purchase periods of leave without pay. Members are not eligible to purchase prior service if you are employed in a non-covered position, are a deferred member or are a retiree.

Under the defined benefit component of the plan, members become eligible for an unreduced retirement benefit when they reach their normal Social Security retirement age and have at least five years (60 months) of service credit, or when their age and service equal 90. Example: Age 60 with 30 years of service credit. For the defined contribution component, members are eligible to receive distributions upon leaving employment, subject to restrictions.

Under the defined benefit component of the plan, members may retire with a reduced benefit as early as age 60 with at least five years (60 months) of service credit.
For the defined contribution component, members are eligible to receive distributions upon leaving employment, subject to restrictions.

Current COLA: 3.0%

July 1, 2023, COLA: 3.0%

The Cost-of-Living Adjustment (COLA) matches the first 2% increase in the CPI-U and half of any additional increase (up to 2%), for a maximum COLA of 3%.

The COLA is not applicable to the defined contribution component.

Eligibility

If a member retires with an unreduced benefit or with a reduced benefit with at least 20 years of service credit, the COLA will go into effect on July 1 after one full calendar year from their retirement date. If a member retires with a reduced benefit with less than 20 years of service credit, the COLA will go into effect on July 1 after one calendar year following their unreduced retirement eligibility date.

Exceptions to COLA Effective Dates

The COLA is effective July 1 following one full calendar year (January 1 to December 31) if a member is in any of the following circumstances:

• The member is within five years of qualifying for an unreduced retirement benefit as of January 1, 2013.

• The member retires on disability.

• The member retires directly from short-term or long-term disability under the Virginia Sickness and Disability Program (VSDP).

• The member is involuntarily separated from employment for causes other than job performance or misconduct and is eligible to retire under the Workforce Transition Act or the Transitional Benefits Program.

• The member dies in service and your survivor or beneficiary is eligible for a monthly death-in-service benefit. The COLA will go into effect on July 1 following one full calendar year (January 1 to December 31) from the date the monthly benefit begins.