LAS VEGAS (KTNV) — The Justice Department is filing a new lawsuit against the State of Nevada, Nevada Attorney General's Office, and Public Employees' Retirement System of Nevada, also known as NVPERS. Federal officials are alleging that when state employees are reemployed after military service, NVPERS is overcharging those service members when calculating contributions to their pension plans.
The complaint states NVPERS is required to allow Nevada public employees covered by the plan the opportunity to purchase up to five years of service time in future pension credits in NVPERS, also known as air time, after vesting with five years of creditable service.
For example, Major Charles Lehman started working for the Attorney General's Office in August 2013. He is also a commissioned officer in the Nevada National Guard. The lawsuit states he was called to serve from May 15, 2017 through Dec. 8, 2020.
Air time credits are calculated by the employee's age and rate of compensation at the time they purchase the credits. On Aug. 26, 2018, the cost of Lehman's five years of air time in NVPERS was $101,184.40. However, because he was serving, he couldn't purchase air time when he passed the five-year mark.
After serving, Lehman requested credit for his military time because that doesn't count as a break in service from employment for pension purposes for people under 38. According to the lawsuit, state officials corrected Lehman's personnel records to credit his military service time on April 20, 2021. After his record was corrected, the suit states that the cost for Lehman to purchase was $139,391, a difference of $38,207.
Lehman filed a complaint with the Department of Labor who launched an investigation into the incident. The lawsuit states department officials tried to solve the issue informally but when that failed, the matter was referred to the Justice Department.
Justice Department officials said investigators found the same issue has happened with other service members.
"[Federal statutes] protect a service member's reemployment rights after returning from military service to their civilian employment," said U.S. Attorney Jason M. Frierson for the District of Nevada. "Every person who has served in our country's uniformed services deserves the full protection of our employment laws."
The lawsuit states the Justice Department is looking to have NVPERS change its policy of overcharging service members and refund Lehman and any other affected service members the amounts they were overcharged.
Channel 13 has reached out to Attorney General Aaron Ford's office, who sent the following statement.
"Our office cannot comment on pending litigation. However, the Office of the Attorney General greatly values those members of our staff who bravely serve or have served our country. Our goal is, at all times, to create an environment of appreciation for our staff, who are all dedicated civil servants working on behalf of Nevada."
