Purpose

The purpose of this solution is to explain the changes required for VRS Defined Contribution Hybrid Deductions effective 7/1/2024.  

  • The VRS deductions for Plan 1, Plan 2 (Legacy) remain the same
  • No changes are required for OLIP, RHIC, GL or VLDP deductions
  • Plan 1 and Plan 2 and Defined Benefit Hybrid deductions will continue to be withheld over contract period
  • Defined Contribution Hybrid deductions must now be submitted over a 12-month period regardless of contract and submitted to Mission Square
  • Defined Benefit Hybrid Mandatory Employer deductions are no longer adjusted by the Defined Contribution Hybrid Mandatory employer or Defined Contribution Hybrid Voluntary employer amounts so rates will now be set on the Deduction Description as opposed to the employee deduction
  • The employee and employer Defined Contribution Hybrid Voluntary deductions will continue to vary based on individual member election of voluntary contributions
  • Please also refer to the recorded webinar, VRS Hybrid Deduction Changes effective Fiscal 2025 (Link available soon)
  • Deferred payrolls for previous fiscal year should be processed before changing to the new VRS deductions
  • If further information is needed for set up of Hybrid Deductions not included in this solution, please refer to VRS Hybrid Deduction Setup
  • Vendor is MissionSquare for DC deductions. Effective 1/2/25 the new vendor will be Voya Financial



Best Practices

We highly recommend using an existing deduction as a template when creating new Deduction Descriptions. For general instructions on how to create a new Deduction Description, please go to Help → OpenRDA Answers/Documentation, and search for the online documentation on the Deduction Description Master Browse.


Below are examples of all VRS plan deductions.  Deductions crossed out are ones that should be inactivated as of 6/30/2024.


Set up for Defined Benefit Hybrid Mandatory - Employee

On the Flags tab, in the section "Select to BLOCK the following Rates", be sure all the selections are checked with the exception of "Salary".


Set up for Defined Benefit Hybrid Mandatory - Employer

  • The Defined Benefit Hybrid Mandatory Employer deductions are no longer adjusted by the Defined Contribution Mandatory and Defined Contribution Voluntary employer amounts so rates will now be set on the Deduction Description as opposed to the employee deduction
  • On the Compute tab change the Compute Type to Percentage of Retirement Salary
  • On the Flags tab, in the section "Select to BLOCK the following Rates", be sure all the selections are checked with the exception of "Salary"



Set up for Hybrid Defined Contributions 12 Month

  • All  DC Hybrid Mandatory and Voluntary Deductions for both employee and employer should now be withheld over a 12-month period despite contract months.  
  • Examples showing the set up for employee and employer mandatory and voluntary deductions.
  • Note:  The computation should now be based on percent of Gross and percent of elected gross. 


DC Hybrid Mandatory - Employee 





DC Hybrid Mandatory - Employer





DC Hybrid Voluntary - Employee

Percentages will be entered on the employee deductions. 





DC Hybrid Voluntary - Employer





Defined Contribution Changes Required for Rate Masters

  • HR → Position Tracking→ Setup → Rates → Rate Masters
  • DC Hybrid Mandatory and Voluntary Deductions are now going to be calculated on the actual VRS job gross pay
  • The 4 rates, Salary, Salary Adjustment, Adjustment and Leave Docked will need to be adjusted as shown below


Customer Specific Setups

  • If DC Hybrid Deductions, Employee and Employer contributions are currently paid over contract period, the Deductions may be set up to range on contract months
  • This range needs to be removed

  • DC Hybrid Deductions, Employee and Employer are now calculated on the actual VRS job gross pay and submitted over 12 months
  • If the computation tab on any of the DC Hybrid deductions includes the formula below, delete the expression and replace it with [STANDARD COMPUTATION]


  • Customers that do not have the Retirement Salary field on the job master, deductions may already be set to Percentage of Gross; In this case, the flags tab may need to be adjusted
  • HR → Position Tracking→ Setup → Gross Definitions → Gross Rates: Verify Gross Rates for Salary Adjustment, Adjustments, Leave Docked and Salary, are not blocking Retirement Earnings


  • Customers that do not have the Position Tracking module and need to make Rate or Gross Rate Changes, please submit a help desk ticket so customer support can assist
  • A new pay type may be required to exclude only VRS DB contributions if paid by contract; Please submit a help desk ticket if you need assistance

 Mass Add Deductions Using Deductions

  • HR → Payroll→ Other → Benefits / Deductions → Mass Add Deductions Using Deductions
  • This process can be used to add new 12-month VRS deductions for the employees that currently have the VRS deduction for 10 or 11-month
  • Use dropdown to select the new deduction to add to employees
  • Range on Deduction ID and enter existing VRS 10 or 11 month deduction
  • Click on cog to run report
  • All new deductions added will display in the browse
  • Save to continue and add new deductions, or click x cancel at the bottom to abort the process
  • Run the process for each deduction that needs to be added



Inactivating Hybrid Employee and Employer Defined Contributions for 10 and 11 Contract Months

  • Go to HR → Payroll → Setup → Deductions → Deduction Descriptions
  • All DC Hybrid Mandatory and Voluntary Deductions for both employee and employer that are specifically for 10 and 11 contract months should no longer be used and inactivated by going to the Flags tab and unchecking the Active flag (example below for DC Mandatory employee paid)


  • All DC Hybrid Mandatory and Voluntary Deductions for both employee and employer that are specifically for 12 months should remain active (example below for DC Mandatory employee paid)

Inactivate Deductions In Mass

  • HR → Payroll→ Other → Benefits / Deductions → Activate / Inactivate Deductions
  • Once new deductions are added, this process can be used to inactivate the 10- and 11-month VRS employee and employer deductions
  • Leave box unchecked labeled "Click/Check to Set the Active Flag/Boolean to True
  • Range on Deduction Description ID that needs to be inactivated
  • Select Current Employees and Select Active Employee Deductions
  • Click on cog to run report
  • If report is correct, set flags; if not correct click cancel



Employee Deduction Masters Report for VRS-RET Plans

  • HR → Payroll→ Other → Virginia State Reports → VRS Reporting → Employee Deduction Masters Report for VRS-RET Plans
  • Enter the actuarial rate (blended rate) to verify that total employer percentages do not exceed the actuarial rate
  • All Defined Benefit, Defined Contribution and Voluntary deductions will be listed by Employee
  • Recommend ranging on Retirement Plan since actuarial rate could be different per plan