How Pre-Retirement Missteps Can Lead to Forfeiting Pension Benefits
Planning for retirement is one of the most significant undertakings of an administrator’s career. Most members spend years carefully tracking service credit, consulting with financial advisors, and reviewing their collective bargaining agreements to ensure they receive every benefit they have earned. What often receives far less attention — until it is too late — is what happens after the retirement date itself, and how decisions made in the weeks and months leading up to that date can jeopardize the very pension benefits a member spent decades accumulating.
The New York State Teachers’ Retirement System and the Employees’ Retirement System have both significantly tightened their scrutiny of retirees who return to work and whether the employee displayed a bona fide termination of employment when they filed for retirement benefits. In plain terms, this means that your retirement must be a real retirement, not a temporary absence followed by a pre-arranged return. NYSTRS and NYSERS are actively looking for evidence that a member genuinely intended to leave employment permanently at the time of retirement, and they have the authority to withhold or reclaim pension benefits if they conclude otherwise.
A recent case out of the Hudson Valley illustrates just how serious – and how unexpected – this problem can be. A longtime elementary principal submitted his retirement paperwork for a June 30, 2025, effective date. He had followed the proper steps, filed on time, and done everything right on paper. Before his retirement date, however, he agreed informally to be placed on his former district’s substitute administrator list. He did not think much of it. He was simply being helpful, as school administrators so often are. What he did not know was that the board of education had formally voted to approve that substitute list in April 2025, two months before he retired. When NYSTRS reviewed his retirement, his name was already on an officially approved district document indicating his availability for post-retirement work. NYSTRS rejected his retirement application on the grounds that he lacked a bona fide intent to retire.
The lesson is one that every administrator approaching retirement needs to hear clearly: it is not only your own conduct that matters. A board vote, a resolution, an email chain, a formal approval, if they reference your post-retirement availability and predate your retirement, can be used as evidence that your retirement was not genuine.
SAANYS recommends that members approaching retirement observe a minimum one-month separation period from their former employer and, critically, avoid any discussions, informal agreements, or documented arrangements regarding post-retirement employment until after the retirement date has passed and the separation is fully established. This includes what may seem like casual conversations with a superintendent or a request from a board member to stay available. If those conversations get memorialized anywhere – in meeting minutes, in an email, in a board resolution – they become part of the record that NYSTRS will review.
The retirement process can be stressful enough without the added burden of a rejected application or a clawback of pension benefits. If you are approaching retirement and have questions about how post-retirement employment might affect your pension, or if your district has already approached you about returning in any capacity, contact the SAANYS Legal Department before you respond.