HI SB1269

Amends the definition of "compensation" for the Employees' Retirement System (ERS) effective July 1, 2011, with different rules for employees hired before and after that date.

For employees hired before July 1, 2011, compensation includes normal periodic payments, overtime and differentials, bonuses and lump sum salary supplements, and elective salary reduction contributions.

For employees hired after June 30, 2011, compensation is narrowed to only normal periodic payments, shortage differentials, elective salary reduction contributions, and twelve-month differentials for Department of Education employees.

Excludes overtime, supplementary payments, bonuses, lump sum salary supplements, and most other differentials (stand-by duty, temporary hazards, compression) from compensation calculations for new employees hired after June 30, 2011.

Bonuses and lump sum supplements for pre-July 1, 2011 employees exceeding one-twelfth of annual compensation must be earned over at least twelve months, either per employer-employee agreement or automatically over the prior twelve months.