TN HB0313

Retired members of the Tennessee retirement system may return to temporary employment while continuing to receive retirement benefits if they had a bona fide separation of service (no prearranged return-to-work agreement and at least 60 calendar days separation)

Temporary reemployment is limited to 120 days per year with compensation capped at 60% of the retiree's final annual salary, adjusted by 5% for each year since retirement; substitute teachers in public schools may exceed the 120-day limit

Retirees may be reemployed in certified "hard-to-fill positions" without day limits, but their retirement benefit is reduced to 70% during reemployment, and the employer must pay additional contributions to the retirement system

Members who retired in fiscal years 2022-2025 without a bona fide separation will be treated as receiving an in-service distribution for tax purposes; after July 1, 2025, they may be temporarily reemployed following proper separation

Most provisions take effect July 1, 2025, with the repeal of Sections 8-36-821 and 8-36-822 taking effect January 1, 2026