Adding Unused Sick Pay to Info Made Public by Local Governments Right Before Retirement for IMRF Employees

David McSweeney

State Rep. David McSweeney has House Bill 303 ready for a vote in the Illinois House of Representatives.

Now, it appears that revelation of last minute payments to employees enrolled in the Illinois Municipal Retirement Fund that would increase their pension does not include accumulated sick leave.

If McSwneey’s bill becomes law that additional information will become transparent.


Adding Unused Sick Pay to Info Made Public by Local Governments Right Before Retirement for IMRF Employees — 12 Comments


  2. Yawn! Much ado about nothing as said the Bard of Avon and the actions of a former state rep from this area demonstrated for almost two decades.

    Example: A sheriff’s deputy whose final rate of earnings is $100K who retires under IMRF SLEP with 30 years of service gets a pension of 75% of his final rate of earnings. That is the max. If he/she has a year of unused sick leave on the books, he/she loses that. AFAIK there is no provision for that to be bought back (at least not here in McHenry County). If that sick leave had been taken over the years it would amount to a years’ salary at whatever the current rate might have been at the time it was used.

    For the sake of argument let’s say that Deputy Smith retired at age 50 with 26 years of service and his final rate of earnings (FE) was determined to be $85K AND he used his sick leave up every single year. His pension would be 65% of $85K or $55,250. If he managed to accumulate a full year of sick leave and turned that in upon his retirement, he would receive an additional 2.5% of his FRE which would make his pension amount $58,225 or $2,975 additional each year.

    Let’s also assume that (using what I imagine is a low ball figure) that had he used up his sick leave as he went along that one year of work, paid out as sick leave over his career would have netted him $60,000. Considering the additional 2.5% added to his pension, he would have to collect his pension for approximately 20 years to break even.

    IMRF is probably the strongest, most fiscally sound public employee pension program in the state. Funding is >92% and has been on an upward trend. There are no last day pay schemes permitted. FRE is determined by the highest CONSECUTIVE 96 months of pay (8 years) of the final TEN years of employment. COL increases is the lower of 3% or 1/2 the increase of the CPI (Urban) based upon the payment made in the retirees first full year of retirement. There is no compounding of the COLA.

    So if Deputy Smith used his unused sick leave to boost his pension, he would see, a COLA of $1,747 annual each and every year. That amount would never increase.

    Something else to consider about the reduction in sick leave taken rather than accumulated is the overtime costs incurred to meet staffing requirements.

    I hope that McSweeney’s bill will illuminate the entire picture and that it’s not just a cheap shot by a politician seeking to distract the public from the root cause of the pension problem in this state: Lying politicians saying they will do one thing and then doing another, i.e. raising taxes to cover pension debt and other obligations and then ignoring those debts and spending money on pork barrel project and programs designed to get themselves reelected.

  3. I’m glad you succinctly responded to a three sentence article with a seven paragraph comment.

    Now I sleep…

  4. IMRF allows accumulated sick leave to be exchanged for years of service credit.

    So if one plans to retire with 30 years of service credit, work 29 years, and exchange 1 years worth of unused sick days for 1 years of service credit.

    The result in that example would be 30 years of service.


    20 sick days = 1 month of IMRF service.

    20 sick days x 12 months = 240 sick days.

    So 240 sick days can be exchanged for 1 years of service credit.


    The number of sick days allotted annually is specified in the collective bargaining agreement (for union members) and in administrator contracts.

  5. 4 years consecutive in a 10 year period, is what is used to average the monthly wage.

    Cary doesn’t allow accumulation of sick time anymore, one a month is awarded and they pay for 25% of unused sick time at the end of the year, per contract.

    Vacation time can only be saved to a tad over twice what is awarded each year, saves on the end of employment big payouts.

  6. Absolutely crazy.

    No way should accumulated unused sick pay be used for pension calculations.

  7. Sick day rules in the McHenry County Sheriff Deputy cba.

    Starting with some cba basics.


    A collective bargaining agreement (cba) is an agreement between an employer and union local.

    Other names for a cba include:

    – negotiated contract

    – contract

    – negotiated agreement

    – agreement

    – labor contract.

    – labor agreement.


    Sick day rules are included in the cba.


    The cba’s are posted on employer websites.


    McHenry County (unit of government) cba’s are posted here:


    The “current” cba’s on that website are mostly expired.

    That is not an unusual occurrence.

    Probable reasons for that:

    – Negotiations are on-going

    – An agreement has been reached but is under legal review

    – The legal review is complete but the agreement is not posted for whatever reason.


    McHenry County Sheriff Deputy’s belong to the Fraternal Order of Police (FOP) labor union.

    The FOP represents three bargaining units in McHenry County:

    – Sheriff Deputy’s (aka FOP Unit 1)

    – Corrections (aka FOP Unit II)

    – Sheriff Civilians (aka FOP Unit III).


    An FYI about Sheriff Civilians.

    Police civilians are typically non sworn employees but in this case can also be sworn employees in non peacekeeping positions.

    Examples of positions covered in Sheriff Civilians FOP Unit III: Auto Technician, Auto Technician Assistant, Clerk II (e.g. Civil Process, Records, Switchboard, Warrants, Work Release), Clerk III (e.g. Civil Process, Records Warrants), Custodian, Court Security (e.g. Security Guard, Magnetometer Operator), Process Server, Radio Dispatcher, and Secretary II.

    Sworn police typically refers to those with a firearm, badge, and the power to arrest.


    The current cba for McHenry County Sheriff Deputy’s (FOP Unit 1) (FOP Unit I) is located here:

    The term of that agreement is December 1, 2014 – November 30, 2018.


    Sick Leave rules for McHenry County Sheriff Deputy’s are outlined in Article XXII Sick Leave of that document.

    Article XXII begins on pdf page 31 of 58.

    Included in that section:

    “Section 3: Unused Leave on Retirement

    If an employee terminates employment at a time when the employee is eligible to receive pension benefits from the Illinois Municipal Retirement Fund, then the employee may use up to two hundred forty (240)sick days,

    or the maximum allowed under IMRF regulation,

    which ever is greater,

    accumulated for the purpose of service credit upon retirement.

    Thereafter, if an employee still has accumulated sick days,

    he may exchange for cash on the basis of (2) sick days for (1) day of pay.”


    IMRF SLEP = IMRF Sheriff Law Enforcement Plan.

    SLEP is one of three IMRF plans.

    The other two being:

    – Regular

    – Elected County Official (ECO)

    For each of those plans (and most the public sector pension funds in Illinois) there are two benefit levels.

    – Level 1. Those beginning their service prior to January 1, 2011 (more lucrative benefits).

    – Level 2. Those beginning their career on or after January 1, 2011 (reduced benefits).


    Each employer, and each plan per employer, has its own IMRF percent funded level, and thus by definition its own unfunded liability.

    For example, this from the most recent comprehensive annual financial report (CAFR) for McHenry County, which is the Fiscal Year ended November 30, 2017 (FY 2017).

    Note, net pension liability = unfunded liability = the amount that actuaries calculate should be in the pension fund, but is not.

    The main problem with the missing funds is their is no investment return on the missing funds.

    Obviously, the investment return on zero, is zero.


    Furthermore, the McHenry County FY 2017 CAFR uses IMRF balances as of December 31, 2016.

    That’s due to the timing of the release date the county CAFR.

    Net pension liability (unfunded liability) for McHenry County IMRF.

    The figures are on pdf page 88 of 243.

    IMRF Regular: $26,108,962

    IMRF SLEP: $24,944,180

    Total: $51,053,142.


    Next the discount rate (interest rate) used by IMRF to calculate the estimated return on investment.

    That’s also found on pdf page 88 or 242 of the McHenry County FY 2018 CAFR.



    Next multiple the net pension liability (unfunded liability) by the interest rate, to determine the estimated debt taxpayers racked up for one year of the IMRF pension not being 100% funded.

    $51,053,142 x .075 = $3,828,985.



    There is an interest cost for holding any debt including unfunded liabilities.

    In the case of unfunded liabilities, the interest is an estimate for illustrative purposes only.

    Actually what happens is annually, the actuary uses all sorts of assumptions, estimations, actual results of the past year, and formulas, and the end result is the annual actuarial report including a newly calculated unfunded liability.


    Let’s compare the annual interest on the unfunded liability, to the percent funded.

    To calculate percent funded, we need to know how much we should have (Total Pension Liiability) vs how much we actually have (Plan Fiduciary Net Position).

    In more technical detail:

    1. The Total Pension Liability is the present value estimate of how much we should have now to pay pensions for work already performed.

    In other words, the present value of projected benefit payments to employees based on their past service.

    2. The Plan Fiduciary Net Position is the value of current investments (assets).


    The Total Pension Liability and the Plan Fiduciary Net Position is also found on page 88 of 243 of the FY 2017 McHenry County CAFR.


    Total Pension Liability

    IMRF Regular: $227,755,459

    IMRF SLEP: $128,177,572

    Total: $355,933,031.

    We should have $355,933,301.


    Plan Fiduciary Net Position

    IMRF Regular: $201,646,497

    IMR SLEP: $103,233,392

    Total: $304,879,889.

    We have $304,879,889.


    $304,879,889 / $355,933,301 = 85.7% funded.


    McHenry County IMRF is 85.7% funded.

    McHenry County IRMF is short $51,053,142.

    One year unfunded liability interest is an estimated $3,828,985.

    $3,828,985 is the estimated cost to McHenry County taxpayers for one year for having underfunded IMRF pensions.



    IMRF has a simple 3% interest, not compounded COLA.

    Meaning, the COLA is the same amount every year.

    It does not go up or down.

    The COLA is more accurately called an annual increase


    Although it has no compound COLA, IMRF has the 13th payment, which is a form of COLA.

    That’s because the 13th payment and a COLA are both to combat inflation.



    “The 13th Payment: IMRF’s Unique Benefit”

    “A Hedge Against Inflation

    The 13th Payment exists to reduce the negative impact of inflation on the value of an IMRF pension.”

  9. Lower employer and state contributions to pensions allows higher contributions to salary hikes.

    The hiked pay results in hiked pensions and increases the unfunded pension liability.


    The public sector workers in Illinois are a very powerful political force.

    Their priority was hiking pay and benefits at the expense of funding pensions.

    A credit card with no limit.

    The credit card comes with a state constitutional contract.

    The contract states benefits cannot be diminished or impaired.


    It’s what they don’t tell you that can kill you.


    The benefits can be hiked.

    And were they ever.

    Over and over.

    Each hike is an enforceable contractual relationship courtesy of the taxpayer’s wallet.

    The Illinois Pension Scam.


    The enabling sentence for the irresponsible behavior:

    “Membership in any pension or retirement system of the State,

    any unit of local government or school district,

    or any agency or instrumentality thereof,




    40 words.

    4 commas.




  10. @ nob

    I stand corrected, don’t know where I picked up 96 months when I was looking at the IMRF site.

    Still the point remains that IMRF does not permit crowning an outgoing employee with a huge raise on his or her last day/week/month of work that we have to foot the bill for through inflated pensions until hell freezes over.

    Perhaps that’s why IMRF is in such good shape and the other are not.

  11. Give Us A Break, your comment on 03/18/2019 at 5:56pm has several other errors as pointed out in the comments above.


    And you continue to make errors.

    IMRF does allow pension spiking.

    The employer pays an increased contribution to IMRF, known as an accelerated payment, when pension spiking occurs.



    Pension Spiking and Accelerated Payment


    McHenry County IMRF has several problems.

    It is not 100% funded.

    It is 85.7% funded as of the FY 2017 McHenry County CAFR.

    McHenry County taxpayers owe IMRF $51 million dollars.

    The one year cost of that $51 million debt is $3.8 million dollars.

    See the comments above.

    The McHenry County Board Chair, Jack Franks, ignores the IMRF $51M shortfall and the $3.8M annual cost of that shortfall in his proposals to reduce the Valley Hi surplus of funds by sending some of it to homeowners.


    One of the reasons property taxes are high is because of employer contributions to the IMRF pension fund.

    Looking at pdf pages 86 & 88 of 243 of the McHenry County FY 2017 CAFR.

    The figures are the contribution to the pension fund by the employee and employer, as a percentage of covered annual salary.

    IMRF Regular employee contribution: 4.5% ($2,438,820)

    IMRF Regular employer contribution: 10.24% ($5,337,095)


    IMRF SLEP employee contribution: 7.5% ($819,691)

    IMRF SLEP employer contribution: 26.96% ($2,938,206)

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