Your New York State and Local Employees' Retirement System (ERS) retirement benefit is based on your service credit, your final average salary (FAS) and the rules specified in your retirement plan. Service crediting is fairly straightforward: you earn service credit for the time you work for a public employer. But the rules for calculating your FAS are a little more involved.
FAS is your highest average annual wages earned during a period of consecutive years. For Tier 1 through 5 members, it is three years; for Tier 6 members, it is five years. And those years can be from any period during your public service, as long as they are consecutive. If you earned more money earlier in your career than you do right before you retire, we will use the earlier years to determine your FAS.
There are some limitations depending on your tier, and any amount over the limit cannot be included in the FAS calculation.
- Tier 1: If your date of membership is June 17, 1971, or later, the earnings in any 12-month period cannot exceed the earnings in the previous 12-month period by more than 20 percent.
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Tier 2: Earnings in any year included in the FAS cannot exceed the average of the previous two years' earnings by more than 20 percent.
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Tiers 3, 4 and 5: Earnings in any year included in the FAS cannot exceed the average of the previous two years' earnings by more than 10 percent.
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Tier 6: Earnings in any year included in the FAS cannot exceed the average of the previous four years' earnings by more than 10 percent.
Lump sum payments for unused sick leave, termination pay and pay for time not worked usually cannot be included in FAS calculations.
Each tier also has specific rules about payments that can be included. For example, Tier 2 members cannot use lump sum vacation payments toward their FAS, and the retirement plans for Tier 5 and 6 members limit the amount of overtime pay that can be used in the FAS calculation.
For general information about your FAS, including calculation examples, visit our Final Average Salary page at www.osc.state.ny.us/retire/members/final_average_salary.php. For specific information about how your FAS is calculated based on your retirewment plan, read your plan booklet on our Publications page at www.osc.state.ny.us/retire/publications/index.php.