§3351.4.  Voluntary deferred salary agreements

A.  Notwithstanding any other law to the contrary, each postsecondary education management board as a body corporate shall have authority to defer payment of all or any part of the salary of one or more employees pursuant to one or more deferred salary agreements made with the employee or employees.  For purposes of this Section, deferred salary is any amount of salary or compensation that is to be paid or provided to the employee in any period or periods later than the period in which the earned salary is usually and customarily paid.  Any deferred salary agreement entered into pursuant to this Section:

(1)  Shall be voluntary on the part of the employee or employees.

(2)  Shall be in writing made prior to the period in which the employment services are rendered by the employee or employees.

(3)  Shall specify the amount of the salary to be deferred and the date or method for determining the date on which the deferred salary shall be paid.

(4)  Shall specify the investment or expenditure of the deferred salary during the deferral period.

(5)  Shall specify the manner in which the deferred salary and any earnings thereon or any appreciation thereof shall be paid or remitted to the employee or employees.

(6)  Shall specify whether or not the deferred salary is subject to retirement benefits.

B.  Deferred salary shall not constitute public funds after it has been earned by the employee or employees and shall be invested or expended in the manner and for the purposes as set forth in the deferred salary agreement.  The employee or employees may receive all economic benefits and shall bear all risk of loss of any expenditure or investment made pursuant to the deferred salary agreement.  This Section shall not apply to any agreement which would otherwise be an eligible deferred compensation plan for purposes of Section 457 of the Internal Revenue Code as amended.  Each postsecondary education management board as a body corporate shall have authority to act on behalf of its employee or employees to acquire insurance, fixed income investments, equities, cash equivalents, or other investments specified in the deferred salary agreement, provided such acquisitions are made solely with funds from deferred salary or from other voluntary contributions by the employee and are made pursuant to a deferred salary agreement.  Furthermore, each postsecondary education management board as a body corporate shall have the authority to establish trusts to implement deferred salary agreements and to serve as trustee for any trusts so established.  Deferred salary placed in a trust shall not constitute public funds.  Deferred salary may be deducted by the employer from the pay, salary, or compensation of the participating employee or employees when authorized in writing by the participating employee or employees.  Each postsecondary education management board as a body corporate is authorized to implement pension and insurance programs for the benefit of their employees, provided that such programs do not conflict with or alter any existing statutory pension and insurance program.  Each management board is hereby authorized to subscribe to or purchase stock of a corporation or association, including but not limited to the power to subscribe to or purchase equities in implementing or providing such pension or other insurance programs.  Pursuant to this provision, each management board may offer stock options to their employees as part of a compensation package.  Each postsecondary education management board shall have the authority to establish trusts to implement pension and insurance programs and to serve as trustee for any trust so established.

Acts 2001, No. 145, §1.