Unlike people working in the private sector, state and local government employees are not always covered by Social Security. Since July 1, 1991, state and local government employees are automatically covered by Social Security if the employee is not a member of a retirement plan provided by the government employer.
To acquire coverage for employees who are retirement plan members, three steps are necessary:
The state must enter into a Federal-State Agreement with the Secretary of Health and Human Services under Section 218 of the Federal Social Security Act to enable employers to provide Social Security coverage for public employees designated from time to time by the state. On September 15, 1953, the State of Illinois entered into a Federal-State Agreement as authorized by the Social Security Enabling Act (Article 21 of the Illinois Pension Code, 40 ILCS 5/21-101 et seq.).
An individual public employer or a retirement system must enter into an agreement with the state to adopt Social Security coverage. For individual employers, this is called an ”absolute coverage group” agreement. For retirement systems, this is called a ”retirement system coverage group” agreement. In both cases the agreement, to the extent authorized by the Social Security Act, must designate which officials’ and employees’ positions are covered and which are excluded from coverage. IMRF entered into a retirement systems coverage group agreement with the State of Illinois (Social Security Unit of the State Employees Retirement System) effective December 31, 1957, retroactive to January 1, 1956.
The State-Federal Agreement must be modified to include each coverage group under the State-Federal Agreement. The IMRF Retirement System Coverage Group was included by Modification No. 59, effective December 31, 1957, retroactive to January 1, 1956. This provided Social Security coverage for employees of all employers in IMRF on December 31, 1957. Employers entering IMRF after that date have been included by subsequent modifications. Some of these had entered into an Absolute Coverage Group Agreement prior to entering IMRF. If there were any differences between the exceptions to coverage in that agreement and the IMRF agreement, the IMRF agreement prevails.