Common use of Annuity Plan Clause in Contracts

Annuity Plan. The school corporation agrees to establish and maintain a qualified 403(b) annuity plan (the "Plan") for all certified employees covered under this collective bargaining agreement. The Plan will include provisions for salary reduction contributions and matching employer contributions. The School Corporation’s matching employee contribution will be one percent (1%) of a teacher’s base salary. The employer’s one percent (1%) match will be made each pay date in which a teacher makes an employee contribution (either to a tax-deferred or a Xxxx 403(b))of at least one percent (1%) of his/her base salary pay for that pay period. In the event an employee does not contribute the minimum required salary reduction amount (one percent (1%) of the teacher’s base salary), the corporation contribution will be zero. It is the employee’s responsibility to increase the salary reduction amount to the minimum requirement. The Plan is subject to Internal Revenue Code non-discrimination tests. If an employee is prohibited from making a full contribution to the Plan due to the non-discrimination tests, the school corporation's matching amount shall be paid to the employee. The 403(b) annuity plan vendor(s) shall be selected by mutual agreement. The School District’s contribution will be deposited in the teacher’s account only with the VALIC vendor. The Board’s Matching Annuity Program will be a continuing obligation after the termination of this agreement unless modified by future negotiations. It is recognized that this contribution was provided in lieu of an equivalent raise on the teacher's regular salary schedule and is a recurring cost.