The following described persons are entitled to death benefits from the Wisconsin retirement system, in the form and at the times specified:
(1) The beneficiary of any participant or of any annuitant on the date of death of the participant or annuitant. For purposes of this subsection:
(a) A participant is deemed a participating employee on the date of death even though the participant is then an applicant for a retirement or disability annuity, except as provided by s. 40.63 (8) (h), if the participant’s application was received by the board within 30 days after the participant ceased to be a participating employee and the participant would have been entitled to the annuity had the participant lived.
(b) If the date of death is less than one year after the last day for which earnings were paid, a participant is deemed a participating employee on leave of absence, notwithstanding the fact that no formal leave of absence is in effect, if the participating employer for which the participant last performed services as a participating employee has not filed notice of the termination of employment prior to the employee’s death.