Frequently Asked Questions About the ERP

Yes, biweekly paid employees are eligible for two Duke retirement plans — the Employees' Retirement Plan and the Faculty and Staff Retirement Plan. The Employees' Retirement Plan is a traditional defined benefit pension plan designed to provide you with a guaranteed monthly income at your retirement, paid for entirely by Duke.  You are also eligible to participate in the Duke Faculty and Staff Retirement Plan which is a 403(b) plan, by making voluntary contributions from your paycheck.

The Employees' Retirement Plan is paid for entirely by Duke. Employees do not contribute to this Plan.  However, you may make voluntary contributions from your paycheck into the Faculty and Staff Retirement Plan.

You are eligible to become a member in the Employees' Retirement Plan as a biweekly paid Duke employee, if you:

• Have reached age 21, and
• Have worked at least 1,000 hours of service during your first year of employment or in any future fiscal year.

Membership in the Plan is automatic once you meet the eligibility requirements.  There are no enrollment forms to complete.  You will receive a letter notifying you of your membership date.  Prior time worked as a monthly paid employee counts towards membership eligibility.

Being vested means you own, or have a nonforfeitable right to, the value of your retirement benefit.  Participants are 100% vested in the ERP upon:

• Completion of five years of continuous service
• Attainment of age 65 while employed by Duke
• Hired after age 65

If you have prior time worked as a monthly paid employee, that time counts towards vesting.

The benefit you receive from the plan is based on a formula.  The factors that determine your benefit are:  your years of credit in the Plan, your average final salary, and your age.

• Continuous Service - You earn a year of continuous service in the ERP for each fiscal year in which you work 1,000 hours or more.  At Duke the fiscal year runs from July 1 through June 30.  Continuous service is counted from your date of hire and used to determine plan membership and vesting. 
• Credited Service - Credited service is all of the years of continuous service you earn after you become a member of the ERP.  The years of credited service will never equal your years of continuous service.  Credited services is used in calculating your benefit.

• Normal - Normal retirement is age 65.  This is when you would receive your full benefit.
• Early - You may retire and receive the benefit early if you are age 45 or older with at least 15 years of credited service.  The benefit will be reduced based on your age at the time benefits start.
• Deferred – If you continue working at Duke past the age of 65 you will receive an additional 10% for credit earned over the age of 65.

The Retirement Planning Guide has been prepared to assist you in planning for your retirement.  We encourage you to review the Retirement Planning Guide which can be found on the HR website for a timeline of when you should take action on various items as you approach retirement. This guide also provides information on what happens with all of your Duke benefits in retirement.

Approximately 40-60 days prior to retirement call the Human Resource Information Center at 919- 684-5600 or register online to schedule an appointment to complete required paperwork for those benefits that you are eligible to continue after retirement.

You will generally receive an estimate of your ERP benefit in your Annual Benefits Statement that is mailed to you each spring.  Or, you may generate an estimate online at the Duke@Work website (under My Benefits) by entering various retirement dates or ages.

No. The Rule of 75 is only used as a factor in determining eligibility for retiree health insurance, dental insurance, and tuition grant benefits as a retiree. The ERP has its own set of rules for when you may receive a benefit.

No. You are not paid for your sick pay/COB balance.  However, if you are an active Plan member paid on the biweekly payroll when you leave Duke, it is used in calculating your final retirement benefit. Your years of credited service are increased by the number of unused hours. [Example: You have 20 years of credited service and 1,000 hours of sick/COB time. When your final calculation is done we would use 20.481. (1000 ÷ 2080=.481) years of credited service.] It is not used to determine your eligibility for early retirement or to help you retire earlier.

There are several payment options available for receiving your benefit.

• A single life annuity is a monthly payment amount you will receive every month for the rest of your lifetime.  All payments stop at your death.  There is no beneficiary under this payment option.
• The Joint and Survivor payment option is designed so that you will receive a payment amount every month for the rest of your life, and at your death your beneficiary would then begin to receive either 50% , 75%, or 100% of what you were receiving.  If you choose a beneficiary that is much younger than you, such as a child, there is a larger age gap between you and your beneficiary that may significantly impact the benefit amount you receive. Also, if your beneficiary passes away before you, your benefit will continue every month for the rest of your lifetime only.
• The level income option at age 62 or 65 is designed so that you receive a higher amount every month until age 62 or age 65, depending on which option you choose.  This payment option might appeal to those who are retiring early and may not be starting Social Security, or would like to have the higher payment amount each month prior to turning age 62 or 65.   There is no beneficiary under this payment option.
• A lump sum payment may be available if the total lump sum value is $10,000 or less.  An example in this scenario might be someone who worked bi-weekly for a very short period of time, and then transferred to a monthly position at Duke or worked at Duke long enough to be vested, but did not have much service beyond that point.

No, once your benefit begins you can not change your designated beneficiary as the benefit is calculated based on your date of birth and your beneficiary’s date of birth.  If your beneficiary passes away before you, the benefit will continue for your lifetime time with no payments after your death.

No, once your payments begin your payment option becomes irrevocable and you can not change or cancel your election. 

A lump sum payment is only available if the lump sum value is $10,000 or less.

If you return to work at Duke while receiving you ERP benefit, the benefit will continue as long as you work less than 1,000 hours during a fiscal year.  A guideline is to work 19 hours or less per week.  If you work more than 1,000 hours during a fiscal year, your ERP payment will stop until you leave employment with Duke.

If you become disabled, and apply for Long Term Disability at Duke and are approved, you will continue to earn credit under the plan as if you continued working at your same rate of pay and work schedule.  You cannot draw retirement and disability at the same time.

When you transfer to a monthly position, you stop earning credit under the ERP and may become eligible to receive Duke’s contribution in the Faculty and Staff Retirement Plan. Under the ERP, your service as a monthly employee is used for vesting and eligibility for early retirement, but that time is not used in calculating your benefit amount from the ERP.

No, you cannot take a distribution from the plan while you are employed at Duke, according to IRS regulations.

No, loans are not permitted from the ERP.

Yes, you are also eligible to participate in the Duke Faculty and Staff Retirement Plan which is a 403(b) plan, by making voluntary contributions from your paycheck.

Refer to the Summary Plan Description for more detailed information.