Michigan § 38.1303a - “Compensation” explained.

Except as otherwise provided in this act, "compensation" means the remuneration earned by a member for service performed as a public school employee.

Compensation includes salary and wages and all of the following:

Remuneration earned for all services performed as a public school employee including, but not limited to, teaching, coaching, and participation in extracurricular activities.

On a current basis, investments made in a tax sheltered annuity for a public school employee as remuneration for service under this act. The remuneration shall be valued at the amount of money actually paid into the annuity.

All amounts deducted from the pay of a public school employee, including amounts deducted pursuant to the member investment plan.

Longevity pay.

Overtime pay for service performed outside of what is considered normal working hours for the affected employee.

Pay for vacation, holiday, and sick leave while absent from work. As used in this subdivision, "sick leave" includes weekly worker's disability compensation payments received for personal injury in the employ of and while employed by a reporting unit.

Items of deferred compensation, exclusive of employer contributions to the retirement system.

Merit pay as established by a reporting unit for the purpose of rewarding achievement of specific performance objectives.

Compensation does not include any of the following:

Payments for unused sick or annual leave.

Bonus payments.

Payments for hospitalization insurance and life insurance premiums.

Other fringe benefits paid by and from the funds of employers of public school employees.

Remuneration paid for the specific purpose of increasing the final average compensation.

Compensation in excess of an amount over the level of compensation reported for the preceding year except increases provided by the normal salary schedule for the current job classification. In cases where the current job classification in the reporting unit has less than 3 members, the normal salary schedule for the most nearly identical job classification in the reporting unit or in similar reporting units shall be used.

The retirement board shall require a sworn affidavit from the member that final compensation does not include remuneration paid either directly or indirectly for actual or anticipated expenses.

Based upon information and documentation provided by the member, the retirement board shall determine both of the following:

Whether any form of remuneration paid to a member is identified in this section.

Whether any form of remuneration that is not identified in this section should be considered compensation reportable to the retirement system under this section.

In any case where a petitioner seeks to have remuneration included in compensation reportable to the retirement system, the petitioner shall have the burden of proof.