Brick Township officials are hoping longtime employees will take advantage of a new “targeted for attrition” program that allows them to retire at 62, but keep their health benefits for life.
The Township Council was expected to approve a resolution at the Sept. 23 council meeting to authorize the program, which would apply only to employees with at least 20 years of service.
“We are going to give them the option to retire now,” Mayor Stephen C. Acropolis said. “It’s a way to reduce the payroll in town and the personnel.”
Some employees work until age 65 simply to retain their health benefits, the mayor said.
“If the people stayed and we did nothing, we would have to pay full benefits and full salaries for the next three years,” Acropolis said. “If they leave now, we only have to pay their health benefits.”
Currently all Brick employees who retire with 25 years of service receive paid township health benefits for the rest of their lives.
Any eligible employees who opt for the new early retirement option will also receive lifetime health benefits, the mayor said.
“Here’s the deal,” Acropolis said. “You pay for both (salaries and benefits) or you pay for one. Without this incentive, no one is going to leave. The higher the salary, the more savings there are, because the health benefits are the same. And if somebody does retire, it gives us an opportunity to reduce the workforce without going through layoffs.”
There are between 12 to 16 people on the township payroll who are eligible for the retirement incentive, Acropolis said.
“We’ve had five people that have expressed a pretty good interest in it,” he said. “Until we get this (resolution) through and it’s final, we really won’t know what the numbers are. We hope to have a least 50 percent.”
Employees who want to take advantage of the incentive must submit retirement papers to the township by Dec. 31 and commit to a retirement date no later than April 1, 2009, the resolution states.
Brick pays roughly $19,000 a year in health care premiums for an employee with family coverage, the mayor said.
In addition to saving on salary costs, the township would not have to pay payroll taxes such as Social Security or make pension contributions, Acropolis said.
“We would be saving a heck of a lot of money, that goes to savings under the new cap,” he said.
Township officials recently announced that for the first time in history, some township employees would be required to contribute to the cost of their health care premiums.
Non-contractual employees, including department and division heads, will be required to contribute at least 1 percent of their salaries toward premium costs, Township Administrator Scott M. Pezarras has said.
The township has also partnered with Marathon Health to establish a “wellness center” for employees at the Civic Center on Chambers Bridge Road. The facility is slated to open at the beginning of next year.