MI SB1500

Establishes early retirement option for certain state employees in the legislature, governor's office, judicial system, and unclassified civil service positions if combined age and service equals 75 years, or 65 years with at least 20 years of service.

Requires eligible employees to submit written application between December 1, 2010 and December 31, 2010, naming a retirement date between January 1, 2011 and February 1, 2011, with ability to withdraw application by January 15, 2011.

Calculates retirement allowance at 1.5% of final average compensation per year of service for employees meeting all requirements, or 1.75% for Tier 1 members and 0.25% for Tier 2 members depending on tier membership election status.

Requires accumulated sick leave payouts to be distributed in 60 equal monthly installments beginning February 1, 2011 from appointing authority funds rather than retirement system funds, and treats payments as taxable income.

Prohibits retirees from being hired under contract by the state for 2 years following their separation date; excludes covered positions and conservation officers from eligibility.