Hawaii ERS · Benefit formula

The Hawaii ERS formula: years × AFC × your percentage

The Employees' Retirement System of the State of Hawaii (ERS) figures every service pension the same way. Here's each piece, with ERS's own worked examples.

Hawaii specificsShort answer: years of service × AFC × 2% (Hybrid, joined before July 2012), 1.75% (Hybrid, later) or 1.25% (Noncontributory). Our example, 26 years on a $72,000 AFC, pays $3,120 a month: open it in the calculator. Before the full-benefit age, see early retirement; for survivor choices, payment options.
The formulaYears of Credited Service x AFC x Benefit Percentage = Maximum Allowance Hybrid handout (Oct. 2026) p. 3, Pension Calculation Formula

Your percentage

Years from two plans

If you also have Noncontributory plan service, that service is figured at 1.25% x years of Noncontributory service x AFC. Previously refunded Contributory service and forfeited non-vested Noncontributory service that a Hybrid member reacquires (free) are also credited at 1.25%. Hybrid handout (Oct. 2026) p. 3 and p. 5, Previously Refunded Contributory Service, Forfeited Noncontributory Service; ERS annual report 2024 p. 46, Note A.3 (benefit is bifurcated by the service earned in each structure)

ERS's example28 Hybrid years × $4,000 × 2% = $2,240, plus 2 Noncontributory years × $4,000 × 1.25% = $100. Total: $2,340 a month. Hybrid handout (Oct. 2026) p. 7, Example of a Pension Calculation

ERS's worked examples

ERS's worked examples (Hawaii ERS)
ExampleYearsAFC a monthERS's figure / ours
Hybrid, joined after June 2012, age 65Hybrid handout (Oct. 2026) p. 320$2,500$875.00
ours matches
Hybrid, joined before July 2012, age 60, 2 yrs at 1.25%Hybrid handout (Oct. 2026) p. 7, Example of a Pension Calculation30$4,000$2,340.00
ours matches
Noncontributory, joined before July 2012, age 65Noncontributory handout (Oct. 2026) p. 325$4,500$1,406.25
ours matches
Noncontributory, joined before July 2012, age 62Noncontributory handout (Oct. 2026) p. 732$4,000$1,600.00
ours matches
Contributory, joined before July 2012, age 58Contributory handout (Oct. 2026) p. 728$4,000$2,240.00
ours matches
Hybrid, joined before July 2012, age 55, 17 yrs at 1.25%Military Service Credit booklet (Oct. 2026) p. 530$4,000$1,890.00
ours matches
Hybrid, joined before July 2012, age 55, 19 yrs at 1.25%Military Service Credit booklet (Oct. 2026) p. 534$4,000$2,150.00
ours matches
Contributory, joined before July 2012, age 55Military Service Credit booklet (Oct. 2026) p. 330$4,000$2,400.00
ours matches
Contributory, joined before July 2012, age 55Military Service Credit booklet (Oct. 2026) p. 334$4,000$2,720.00
ours matches
Noncontributory, joined before July 2012, age 55Military Service Credit booklet (Oct. 2026) p. 430$4,000$1,500.00
ours matches
Noncontributory, joined before July 2012, age 55Military Service Credit booklet (Oct. 2026) p. 434$4,000$1,700.00
ours matches
Hybrid, joined after June 2012, age 65Hybrid Q&A brochure (2012) Q920$2,500$875.00
ours matches

Your AFC (average final compensation)

In the calculator you enter your AFC as a yearly figure. We divide it by 12. Example: $30,000 a year is $2,500 a month, so 20 years at 1.75% pays 35% × $2,500 = $875. Hybrid handout (Oct. 2026) p. 3

The federal pay limit on your AFC Check with ERS

The 2012 Hybrid brochure gives the 2012 federal compensation limit ($250,000); no current figure is in the sources, so none is applied.

What would settle it: A current ERS publication stating the IRC 401(a)(17) limit

Anti-spiking (excess pension costs)

Members with an ERS membership date before July 1, 2012 who retire after June 30, 2012. Excess pension costs: if (1) average non-base pay divided by average base pay in the AFC period is greater than 10%, and (2) that ratio divided by the comparison-period non-base pay ratio is 120% or more, the excess in the maximum allowance ('pension spiking') is figured and the member's last employer pays additional employer contributions for it. In ERS's example the limited AFC is (1 + comparison-period ratio) x AFC base pay. ERS Excess Pension Costs page (Q1-Q3, citing HRS §88-100); ERS annual report 2024 p. 45 and p. 55, Note A.3

Members hired after June 30, 2012 have a base-pay-only AFC (five highest years), so non-base pay such as overtime is not in the AFC. Hybrid handout (Oct. 2026) p. 3; ERS annual report 2024 p. 17

ERS's worked example compares the three AFC years with the 7 years before them. Test 1 asks whether non-base pay is more than 10% of base pay in the AFC years. Test 2 asks whether that ratio is 120% or more of the earlier ratio. Only failing both counts as spiking. ERS anti-spiking example (2012) p. 1

Anti-spiking (excess pension costs) (Hawaii ERS)
ERS's exampleAFC years: base / non-baseEarlier years: base / non-baseTest 1Test 2AFC used for the excess
Employee #1 (consistent non-base pay)$39,000
$7,800 (20%)
$34,000
$6,800 (20%)
Over 10%Not over$46,800
Employee #2 (spiked non-base pay)$37,000
$9,800 (26.49%)
$32,000
$1,600 (5%)
Over 10%Over 120%$38,850
of $46,800
Employee #3 (Teacher type)$39,000
$1,200 (3.08%)
$34,000
$0 (0%)
Not overOver 120%$40,200
What it means (ERS's Employee #2)Non-base pay jumped from 5% of base pay to 26.49%, so both tests fail. ERS limits the AFC to (1 + 5%) × $37,000 = $38,850, instead of $46,800. ERS's example member is a Police and Fire employee age 55 with 30 years of service, at 2.5% × 30 years: an excess of $5,962 a year, which the last employer pays for. The teacher-type Employee #3 passes Test 1, so nothing changes. ERS anti-spiking example (2012) p. 1 (Impact on Police and Fire employee age 55 with 30 years of service; Maximum Annuity = 2.5% x 30 x AFC)

The example is from 2012 and uses the police and fire multiplier, not one of the general-employee rates above. It shows how the tests work, not a teacher's pension.

How service is counted

Who pays for it

Hybrid members pay 6% of pay (8% if you joined after June 30, 2012). Noncontributory members pay nothing. Hybrid Q&A brochure (2012) Q3; Leaving Employment, Hybrid (2012) Q1 Since 1989 employers 'pick up' member contributions as employer contributions for tax purposes (IRC 414(h)(2)); contributions are deducted pre-tax. ERS annual report 2024 p. 55, Note A.3; Leaving Employment, Hybrid (2012) Q1

Statutory employer contribution rate for All Other Employees (everyone but police and fire): 24% of payroll for FY 2021 and beyond. ERS actuarial valuation 2025 PDF p. 15 and PDF p. 25, Table 1 line 7a; ERS annual report 2024 p. 45, Note A.3

Older brochures say 15% Check with ERS

The 2012 Hybrid and Noncontributory Q&A brochures (Q4) say the employer 'currently contributes 15% of your compensation'. The June 30, 2025 valuation and ACFR 2024 say the statutory rate for All Other Employees is 24% (FY 2021 and beyond). The brochures are older and are not used for the rate.

Hybrid Q&A brochure (2012) Q4; ERS actuarial valuation 2025 PDF p. 25, Table 1 line 7a

From the sources

Questions

What is the ERS formula?

Years of credited service × your average final compensation (AFC) × your plan's percentage = your Maximum Allowance, the highest monthly pension.

What's my percentage?

Hybrid: 2% a year if you joined before July 1, 2012, 1.75% if after June 30, 2012. Noncontributory: 1.25%. Noncontributory years of a Hybrid member count at 1.25%.

What pay counts?

Joined before July 1, 2012: your three highest 12-month periods of gross pay (overtime included). Joined after June 30, 2012: your five highest, base pay only. Lump-sum vacation pay never counts.

What is anti-spiking?

For members who joined before July 1, 2012: if non-base pay (like overtime) in your AFC years is more than 10% of base pay and at least 120% of the earlier ratio, ERS figures the excess and your last employer pays for it.

Run the formula on your numbers →

Source: Hawaii ERS Hybrid Retirement Information, October 2026, pp. 3, 5, 7. Also: ERS annual report 2024 pp. 17, 45, 46, 55; Hybrid Q&A brochure (2012) Q3, Q6, Q9, Q11; ERS Members FAQ page; Noncontributory handout (Oct. 2026) pp. 3, 7; Military Service Credit booklet (Oct. 2026) pp. 3, 4, 5, 8, Q9; ERS Excess Pension Costs page Q1-Q3; ERS anti-spiking example (2012) p. 1; ERS actuarial valuation 2025 PDF pp. 15, 25; Leaving Employment, Hybrid (2012) Q1; Contributory handout (Oct. 2026) pp. 3, 7; HAR §§ 6-21-4, 6-21-6, 6-21-8. Last reviewed .