All Roll Calls
Yes: 39 • No: 0
TennesseeSB 0251114th General Assembly (2025-2026)SenateWALLET
AN ACT to amend Tennessee Code Annotated, Section 8-25-213 and Title 8, Chapter 36, Part 8, relative to reemployment after retirement.
Sponsored By: Sponsor information unavailable
Signed by Governor
Public Employees
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Bill Overview
Analyzed Economic Effects
3 provisions identified: 0 benefits, 0 costs, 3 mixed.
Hard-to-fill jobs mean smaller retiree pensions
Beginning July 1, 2025, qualifying retirees can fill hard-to-fill covered jobs and receive wages plus 70% of their normal pension. They need 60 calendar days away from all covered work, no prearranged return, and cannot receive disability retirement. Employers must document hiring difficulties, specialized qualifications, high market demand, the job's critical role, or other recruitment problems. Before each work period, employers must notify the retirement division and certify the retiree's qualifications and lack of another reasonably available qualified person. Each period lasts up to one year; annual renewals require fresh certification of these requirements. Employers must pay the greater of their normal active-member pension contribution or 5% of the retiree's earnable pay. Retirees earn no additional pension benefits from this work.
Retirees can work but face limits
Beginning July 1, 2025, eligible Tennessee public retirees can work temporarily while collecting their pension. This includes prior class members and retirees from covered local retirement funds. Retirees need 60 calendar days away from all covered work and no prearranged return-to-work agreement. Those receiving disability retirement cannot use this path. Work is generally capped at 120 days in 12 months, with equivalent-hour limits for educational staff. Higher-education teaching is capped at 24 quarter or 18 semester credit hours. Pay is capped at 60% of the prior full-time annual salary from the year before the last paid covered workday. That limit rises 5% for each year since that day, unless the state treasurer and human resources commissioner set another percentage. Substitute teachers can exceed 120 days, but cannot earn above the substitute rate or a prorated average salary in their discipline. Exceeding work or pay limits reduces the monthly pension by the greater of two amounts: 1/20 of the monthly pension per excess day, or a proportional reduction for excess pay. The system can recover overpaid benefits through pension deductions. Employers must certify the work period, days or hours, pay, expected end date, and absence of a prearranged return. Retirees must acknowledge the certification and provide hours and pay statements on request; records remain subject to audit. Retirees can use state 401(k) and 457(b) savings plans, but earn no added pension service or benefits. The law also applies these work and pay limits through a related deferred-compensation rule. It exempts five listed return-to-work paths from a separate subsection whose requirements are not described in the supplied text. Beginning January 1, 2026, it repeals two former return-to-work sections; their specific effects are not described.
Recent retirees face tax-reporting corrections
The law covers retirements effective in fiscal years 2022-23, 2023-24, and 2024-25, running July 1 through June 30. If the retirement system finds no genuine separation from work, it must classify payments as distributions received while still employed. It must correct prior-year tax reporting, which can affect the retiree's taxes; no tax amount is specified. After July 1, 2025, identified members can return to temporary covered work only after a genuine separation. That requires at least 60 calendar days away from all covered work and no prearranged return-to-work agreement.
Sponsors & Cosponsors
Sponsors
There is no primary sponsor on record.
Cosponsors
Reeves
Affiliation unavailable
Roll Call Votes
Senate vote • 3/10/2025
FLOOR VOTE: Motion to Adopt 3/10/2025
Yes: 30 • No: 0
Senate vote • 3/4/2025
SENATE STATE & LOCAL GOVERNMENT COMMITTEE
Yes: 9 • No: 0
Actions Timeline
Effective date(s) 07/01/2025, 01/01/2026
5/2/2025Pub. Ch. 159
5/2/2025Signed by Governor.
4/11/2025SenateTransmitted to Governor for action.
4/3/2025SenateSigned by H. Speaker
4/2/2025HouseSigned by Senate Speaker
4/2/2025SenateEnrolled and ready for signatures
4/1/2025SenatePassed H., Ayes 93, Nays 0, PNV 2
3/31/2025HouseSubst. for comp. HB.
3/31/2025HouseRcvd. from S., held on H. desk.
3/13/2025HouseEngrossed; ready for transmission to House
3/10/2025SenatePassed Senate, Ayes 30, Nays 0
3/10/2025SenatePlaced on Senate Consent Calendar 2 for 3/10/2025
3/7/2025SenateRecommended for passage, refer to Senate Calendar Committee
3/4/2025SenatePlaced on Senate State and Local Government Committee calendar for 3/4/2025
2/25/2025SenateSponsor(s) Added.
2/18/2025SenateSponsor change.
2/18/2025SenatePassed on Second Consideration, refer to Senate State and Local Government Committee
2/10/2025SenateIntroduced, Passed on First Consideration
1/27/2025SenateFiled for introduction
1/22/2025Senate
Bill Text
Enrolled / Public Chapter
Fiscal Note
Introduced
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