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ARTICLE 23 - SEVERANCE PAY 23.1 Lump Sum Severance A. Upon separation from employment with the City, employees with less than twenty (20) years of service and leave in good standing will receive a lump -sum taxable severance compensation for all accrued vacation and compensatory time. B. Employees who separate with less than two years of service are not eligible to be compensated for accrued sick leave. (Employees who separate with two or more years of service will contribute their eligible sick leave hours to the Retirement Health Savings Plan as provided in 23.2.A). 23.2 Retirement Health Savings Plan The City of Mounds View offers its employees a Retirement Health Savings Plan pursuant to Internal Revenue Code regulations through a third party administrator selected by the City. Future changes in the Internal Revenue Code regulations may change the tax status of this plan and the City shall not be liable for such changes. Contribution to the Plan shall occur according to the following provisions A. Employees who have completed two or more years of service and leave in good standing shall direct their eligible sick leave compensation to the Plan. Eligible sick leave shall be computed based on years of completed service, less elected annual contributions, computed according to the table in Appendix B, at a conversion rate of two for one (50%). Employees who had accumulated 960 or more hours of sick leave as of January 1, 2005 are not subject to the computation table in Appendix B. Rather, any such employee shall direct sixty-five percent (65%) of their remaining sick leave compensation to the Plan. B. Upon separation from employment with the City, employees who have completed twenty (20) or more years of service and leave in good standing will contribute 100% of their compensation for accrued vacation and compensatory time to the Plan. C. Employees will contribute a percentage of their annual pay on a pre-tax basis to the plan as follows: 12