Janesville65.8°

Rehiring retired employees becoming more common

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Stacy Vogel
January 12, 2008
— When the village of Jackson rehired its administrator a month after he retired, a few people complained, said Village President Scott Mittelsteadt.

“Some people did squawk about it, until we explained to them that it did save the community money,” he said.


That was two years ago, and the commotion has died down, Mittelsteadt said. Meanwhile, the village is saving $9,000 a year in benefits it doesn’t have to pay its administrator, and the administrator is pulling in both a salary and a pension.


“It’s really a benefit to the community,” Mittelsteadt said.


The city of Milton is thinking of making a similar move after this week’s retirement of Police Chief Tom Gilland.


The Milton Police Commission announced Wednesday night that it didn’t appoint an interim chief because of the chance Gilland could return to work after 30 days.


Rehiring a retired government employee is becoming increasingly common in Wisconsin, said Michelle Baxter with the Wisconsin Department of Employee Trust Funds.


The department received 1,100 applications from people retired from government jobs who planned to return to the public sector in 2006, Baxter said. Most of those employees end up receiving wages on top of pension payments, she said.


The federal government requires a “good-faith” retirement of 30 days before a retiree can return to work and still receive pension payments, said John Vincent, also with the Department of Employee Trust Funds.


During that time, the employer and employee aren’t supposed to come to a written or verbal agreement. They’re also not supposed to discuss an arrangement before the employee retires, he said.


Milton city officials and the police commission have been considering asking Gilland to return since he announced his retirement in a letter dated Dec. 5, but they haven’t come to any arrangement, said City Administrator Todd Schmidt.


He declined to say if the city has discussed the idea with Gilland, and Gilland declined to comment on the matter.


But Schmidt said he believes if Gilland is offered the job, he will give it serious consideration.


“He has indicated his willingness to help out in any way, and he hasn’t indicated that he’s not willing to come back,” Schmidt said.


Rehiring Gilland would benefit both Gilland and the city, Schmidt said. After 29 years of service with the department, Gilland was probably close to maxing out his pension, if he wasn’t already there, he said.


At that point, “it just simply doesn’t make a lot of economic sense to continue working in terms of what your retirement pension will be,” Schmidt said.


But if the city rehires Gilland after he retires, the city retains Gilland’s expertise while avoiding paying into a retirement account, Schmidt said. In 2007, the city paid more than $10,000 into Gilland’s pension.


If hired, Gilland still would be eligible for city-sponsored health insurance because the city covers retired employees, although he might have to pay a higher premium, Schmidt said.


“It’s hard for me to understand why, if all these circumstances work out for a community, why that would be a bad thing,” he said.


The city is preparing to move quickly after Gilland becomes eligible to enter into a contract Feb. 7. The city council will discuss at its meeting Tuesday what terms it will include in Gilland’s contract if the police commission decides to appoint him, Schmidt said.


Although Schmidt has solicited proposals from private consulting firms to aid in a possible search for a chief, he hasn’t gone through the three he received so far, he said.


The police commission has received letters from several people interested in the chief position, but it hasn’t established a list of criteria for the job and probably won’t until it decides whether or not to appoint Gilland, Chairman Stephen Tupper said.


Tupper expects the commission to make a decision quickly after Gilland becomes eligible, he said.


“I don’t see any point in delaying that,” he said.


CHIEF TIMELINE

Dec. 5, 2007: Chief Tom Gilland sends a letter to the city announcing his intent to retire effective Jan. 7.


Dec. 13: The Milton Police Commission appoints former Chief Terry Hawkins interim chief. The meeting is declared illegal because the commission failed to notify the public before it took place.


Dec. 18: The commission appoints Hawkins interim chief in a legal meeting. The city council meets that night and agrees on terms of a contract to offer Hawkins.


Dec. 28: The city announces Hawkins declined the offer. Hawkins says he could not accept the position under the terms offered by the council. The city and Hawkins decline to specify the terms.


Jan. 3, 2008: The Milton Police Commission meets and decides not to appoint an interim chief. Instead, the department’s sergeants will handle day-to-day operations, and the commission will oversee the department through commission member Dave Ostrowski.


Jan. 7: Gilland retires effective 12:01 a.m.


Jan. 9: After questions from The Janesville Gazette, the city issues a news release stating the lack of an interim chief is meant to be a short-term situation as the city waits to see if it will rehire Gilland.


Jan. 15: The Milton City Council will discuss in closed session what terms it will offer Gilland if the police commission decides to appoint him chief.


Feb. 7: Gilland will become eligible to enter an employment agreement with the city.



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