Payment and distribution of contributions.

(1) Contributions made pursuant to this part shall be paid by the employer, including the employee contribution, to the Division of Retirement by electronic funds transfer no later than the 5th working day of the month immediately following the month during which the payroll period ended. Accompanying payroll data must be transmitted to the division concurrent with the contributions.

(2) The division, the State Board of Administration, and the third-party administrator, as applicable, shall ensure that the contributions are distributed to the appropriate trust funds or participant accounts in a timely manner.

(3)(a) Employee and employer contributions and accompanying payroll data received after the 5th working day of the month are considered late. The employer shall be assessed by the Division of Retirement a penalty of 1 percent of the contributions due for each calendar month or part thereof that the contributions or accompanying payroll data are late. Proceeds from the 1 percent assessment against contributions made on behalf of members of the pension plan must be deposited in the Florida Retirement System Trust Fund, and proceeds from the 1 percent assessment against contributions made on behalf of members of the investment plan shall be transferred to the third-party administrator for deposit into member accounts, as provided in paragraph (c).

(b) Retirement contributions paid for a prior period shall be charged a delinquent fee of 1 percent for each calendar month or part thereof that the contributions should have been paid. This includes prior period contributions due to incorrect wages and contributions from an earlier report or wages and contributions that should have been reported but were not. The delinquent assessments may not be waived.

(c) If employee contributions or contributions made by an employer on behalf of members of the investment plan or accompanying payroll data are not received within the calendar month they are due, including, but not limited to, contribution adjustments as a result of employer errors or corrections, and if that delinquency results in market losses to members, the employer shall reimburse each member’s account for market losses resulting from the late contributions. If a member has terminated employment and taken a distribution, the member is responsible for returning any excess contributions erroneously provided by employers, adjusted for any investment gain or loss incurred during the period such excess contributions were in the member’s account. The state board or its designated agent shall communicate to terminated members any obligation to repay such excess contribution amounts. However, the state board, its designated agents, the Florida Retirement System Investment Plan Trust Fund, the department, or the Florida Retirement System Trust Fund may not incur any loss or gain as a result of an employer’s correction of such excess contributions. The third-party administrator, hired by the state board pursuant to s. 121.4501(8), shall calculate the market losses for each affected member. If contributions made on behalf of members of the investment plan or accompanying payroll data are not received within the calendar month due, the employer shall also pay the cost of the third-party administrator’s calculation and reconciliation adjustments resulting from the late contributions. The third-party administrator shall notify the employer of the results of the calculations and the total amount due from the employer for such losses and the costs of calculation and reconciliation. The employer shall remit to the Division of Retirement the amount due within 30 working days after the date of the penalty notice sent by the division. The division shall transfer that amount to the third-party administrator, which shall deposit proceeds from the 1 percent assessment and from individual market losses into member accounts, as appropriate. The state board may adopt rules to administer the provisions regarding late contributions, late submission of payroll data, the process for reimbursing member accounts for resultant market losses, and the penalties charged to the employers.

(d) If employee contributions reported by an employer on behalf of members are reduced as a result of employer errors or corrections, and the member has terminated employment and taken a refund or distribution, the employer shall be billed and is responsible for recovering from the member any excess contributions erroneously provided by the employer.

(e) Delinquency fees specified in paragraph (a) may be waived by the division, with regard to pension plan contributions, and by the state board, with regard to investment plan contributions, only if, in the opinion of the division or the board, as appropriate, exceptional circumstances beyond the employer’s control prevented remittance by the prescribed due date notwithstanding the employer’s good faith efforts to effect delivery. Such a waiver of delinquency may be granted an employer only once each plan year.

(f) If the employer submits excess employer or employee contributions, the employer shall receive a credit to be applied against future contributions owed. The employer is responsible for reimbursing the member for any excess contributions submitted if any return of such an erroneous excess pretax contribution by the program is made within 1 year after making erroneous contributions or such other period allowed under applicable Internal Revenue guidance.

(g) If contributions made by an employer on behalf of members in the investment plan are delayed in posting to member accounts due to acts of God beyond the control of the Division of Retirement, the state board, or the third-party administrator, as applicable, market losses resulting from the late contributions are not payable to the members.