How is credit earned in each system?
Before answering this question, it is important to understand the types of service credit earned. There are two types of credit in the retirement and pension systems, eligibility service and creditable service. An easy way to remember the difference is that eligibility service is used to determine a members eligibility for a benefit, while creditable service is used in the benefit formula to calculate the benefit. First lets discuss creditable service, in the retirement system, creditable service is awarded to a member for each month in which there are retirement contributions. Service credit is awarded on an ongoing basis and there is no proration for part-time work, as the retirement benefit is based on actual salary. In the pension systems, creditable service is awarded at the end of each fiscal year. Service credit is calculated by dividing the members hours worked by the members standard hours for the fiscal year multiplied by the number of months worked. Based on this formula, pa
