Posting by Phil Vivirito

At times an employer’s response to an unreported employee being picked up on our audit report is” that person is retired”. The employer’s position is that since that person is retired and is already collecting a pension there is no need to report him. Upon hearing this from an employer the auditor should ask where that person retired from. If he is retired from an industry other than the one that he is currently working in and that pension is from a fund other than the one you are auditing for, then the person should be reported. He is just like any other employee working in a covered position. However if the person has retied and is collecting a pension from the fund you are doing the audit for, it is a different scenario. The audit will have to refer to the rules of the fund for its retirees returning to work in a covered position. There may be a cap on how many hours per month that the employer must report. He may have to be reported for all hours and have his pension suspended, or reduced by a certain amount based on how many hours he works.