Ask The Experts: Retirement

By Reg Jones

Rehire after retirement; length or service to reach 80 percent annuity

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Q. Are there new rules as to how long a civil service employee can be retired and return to work as a federal employee? I was always told five years.

Also, do CSRS employees have to work 42 years to get 80 percent of their salary?

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Service computation date

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Q. Can a person who is retired from federal civil service and receiving a retirement check keep their service computation date upon rehire?

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Rehire, job loss and annuity

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Q. I had 24.9 years of government civil service with the Navy. We were BRACed, and I retired. Then I got hired as a contractor for the government for less than a year. Now I work for the Air Force at a decrease in pay and grade. I may lose my job again because of the budget cuts in the government. How will all this affect my annuity, which I’m still receiving, if I lose this job?

A. If you received both your annuity and the unreduced salary of your new position, you wouldn’t receive any credit for that period of employment and your annuity would remain the same when you left. If your salary was reduced by the mount of your annuity and you worked for at least one year (or the part-time equivalent), you’d be entitled to your original annuity plus a supplemental annuity based solely on that new period of employment.

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Postal Service VERA

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Q. I am a 55-year-old Postal Service employee with more than 26 years of creditable service who has been on active duty under Title 10 for the past 10 years.  Late last year, I was offered the Voluntary Early Retirement Authority, which I accepted and submitted the irrevocable application along with all of the required documents.  On Jan. 31, I received a phone from the Postal Service human resources office to inform me that my retirement could not be processed because I am on active duty. I was also told that I had to return to pay status to be eligible for retirement.

1.  Is leave without pay or on military leave a pay status?

2.  Under the Uniformed Services Employment and Reemployment Rights Act, my employer is obligated to rehire me after five years of military service. What would guarantee that I will be rehired after 15 years of military service?

3.  Since the Postal Service is offering the VERA because of reorganization, what precludes them from honoring the offer for retirement?

4.  Do I have any legal recourse to pursue this issue?

A. 1. No.

2. No.

3. You aren’t an employee.

4. No.

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Rehire offered lower salary

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Q. I was asked to return to my previous position as a rehire annuitant. I pursued the offer by applying for the announced position. I was then selected for the job but only offered a Step 1 in my retirement grade level. At the time of my retirement, I was a Step 6. The hiring official tried hard to convince the third line manager to approve my special qualifications with no avail. In the end, I was offered a lower salary than I had at the time of my retirement. Fair? Any rights?

A. As a re-employed annuitant, you at an “at will” employee. The agency that hires you isn’t required to match your previous grade and/or pay. You, in turn, can either accept or reject their offer.

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Re-employment and five-year rule

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Q. My husband worked for a Veterans Affairs Medical Center for seven years, then left federal employment.  He is 63 and eligible for a deferred annuity. He may be returning to his previous job. Is there a certain amount of time he must be re-employed so as to be able to retire and carry his health benefits into retirement?

A. If he was enrolled in the Federal Employees Health Benefits program on the day he left, re-enrolls on the day he is re-employed by the federal government, and has been enrolled for five years, he would be able to carry that coverage into retirement.

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Rehire

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Q. I did early retirement in 2005 by way of a buyout. I receive an annuity. What would the issue be if I return to federal service now?

A. Because you didn’t meet the normal age and service requirements to retire, when you went back to work, your annuity would stop, and you wouldn’t be able to retire again until you did.

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Firefighter questions

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Q. I have been a federal firefighter for 12 years. I am looking into going contract as a firefighter for two years. I turned 35 in October. Is there a cutoff age to where I can no longer return to the federal service as a firefighter? I have heard several things and am not sure which is right. I even spoke to my personnel office, which could not give me an answer. I heard you cannot get rehired once you turn 37 and that you can add the years you have been in the federal service to 37 and that would be the cutoff age.

A. There would be no legal bar to your being rehired as a firefighter.

Your years of covered service mean you would have to work for only eight more years to lock in your entitlement to the enhanced retirement benefit.

However, the hiring decision is up to the agency where you are applying for a job.

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High-3

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Q. I have just returned to federal civil service after being away for 4½ years. I have made a lump-sum deposit for those 4½ years. If I retire tomorrow, how will my high-3 salary be calculated? Would it reflect the salary tables for 2008 to 2012 — the years I was away — or would my actual salary from 2004 to 2007 be used?

A. Your high-3 would be based on the average of the highest three consecutive years of basic pay you actually received, not what you would have received if you’d been at work.

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High-3

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Q. I started at a federal agency in June 2010 as a GS-14. I bought back my military time (10 years).  I was recalled to active duty in the Army in March 2011. I was on active duty, and in a leave-without-pay status, until March 2012. I returned to my agency after completing my service. I may take a GS-12 position closer to home. I’m close to retirement age. If I switch to GS-12 in July, would my high-3 be a mix of GS-14 and GS-12? If I switch to GS-12 in January 2015, would my high-3 be as a GS-14?

A. Your high-3 will be your highest three consecutive years (36 months) of average basic pay, no matter when they occur in your career.

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VERA/VSIP vs. military retired pay

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Q. I’m a civil service employee covered by FERS. My agency is offering Voluntary Early Retirement Authority/Voluntary Separation Incentive Pay. I am 62 and receiving military retired pay. I’ve been told that I’m not eligible for either VERA or VSIP because I’m receiving military retired pay. Is that true?

A. Not that I’m aware of. According to the Office of Personnel Management:

Employees in the following categories are not eligible for VSIP. Employees who:

1. Are re-employed annuitants;

2. Have a disability such that the individual is or would be eligible for disability retirement;

3. Have received a decision notice of involuntary separation for misconduct or poor performance;

4. Previously received any VSIP from the federal government;

5. During the 36-month period preceding the date of separation, performed service for which a student loan repayment benefit was paid, or is to be paid;

6. During the 24-month period preceding the date of separation, performed service for which a recruitment or relocation incentive was paid, or is to be paid; and

7. During the 12-month period preceding the date of separation, performed service for which a retention incentive was paid, or is to be paid.

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Rehire and accrued sick leave

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Q. I left the Department of Justice in 1999, after working as a civilian for five years. I returned to DOJ in July. On my first day back, my agency told me my accrued sick leave would be reinstated to my account as soon as they got my personnel jacket from the Office of Personnel Management.

I am now being told that my personnel jacket does not contain any information about how much sick leave I may have accrued in the 1990s. They asked if I have my final pay stub, which I do not. They also cannot locate this final pay stub electronically.

What are the next steps for me? I know I have a lot of sick leave accrued from that first position at USDOJ. I’d like it back.

A. If your agency retrieved your personnel jacket from the National Personnel Records Center, then you’ll have to go back to your former agency to find out if they can reconstruct your sick leave history. If your agency didn’t do that, you can go online at www.archives.gov/st-louis and click on Civilian Personnel Records. That’s where you’ll find instructions on how to access your prior service records.

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Earnings limit

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Q. I am retired from the Postal Service. I am turning 66. If I pick up Medicare Part B, can I claim it on my taxes? How much in yearly salary can I earn if I go back to work?

A. If you have reached your full Social Security retirement age, there is no limit on the amount you can earn. However, if you were to return to work for the federal government, in most cases your salary would be reduced by the amount of your annuity.

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Excessed employee and accrued sick leave

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Q. If you’re a FERS employee without the age or years to retire and are told you will be excessed to another office and want to leave the Postal Service instead of taking the new position, what happens to your accumulated sick leave?

A. It will be retained in your official records. If you return to to work for the government, that sick leave will be restored.

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Reinstatement and sick leave

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Q. I resigned from the federal government in 2002 and have now been reinstated in 2012. Am I entitled to my sick leave balance back?

A. Yes.

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Part-time re-employment

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Q. I am a federal employee under FERS and plan to retire from my current job at full retirement age and then continue working. Would I be able to work full time or part time for another federal entity without negative consequence? I’ve heard that there are new provisions being contemplated to allow retired federal employees to return to work part time in federal employment?

A. There is a new law, but it doesn’t apply to someone retiring from one agency and moving to another. It only applies to an employee who retires and continues as a part-timer in their same job, generally in a mentoring capacity. Since it is an agency option, you’d need to find out from your agency if such an arrangement would suit them. Note: There are limited opportunities for a retiree to go back to work for the government either full time or part time while receiving both his annuity and the full salary of his position. Only the agency with whom you’d like to be employed can tell you if a position in which you are interested is one of them.

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Rehire and annuity

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Q. I retired under CSRS on a Voluntary Early Retirement Authority at age 46 with 26 years of service. I’m considering going back to work with the agency from which I retired. I’m still under age 55 (53 years old). What benefit would returning to full-time work be for me? Can I retire again any time after 55? Will my additional years apply to my retirement the second time around? What happens to penalties previously taken on early retirement?

A. If you return to work for the government, your annuity will terminate and you’ll be treated as if you had never retired. Although you’ll start with a zero balance of annual and sick leave, your annual leave accrual rate would be the same as if you hadn’t retired. You wouldn’t be eligible to retire again until you meet the age and service requirements, in your case age 55 with 30 years of service.

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Part-time re-employment and annuity

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Q. I will be 64 this year and am considering retirement as a Senate employee. If I retire and begin my annuity from FERS, can I be employed part time and not lose any of my annuity or benefits if I earn less than the earnings limit set by Social Security?

A. With rare exception, if you retire and are re-employed by the federal government, the salary of your new position will be reduced by the amount of your annuity. So, before you accept another position, you’ll need to find out if it is exempted from this basic provision of law. If it is, you’ll be able to receive both your annuity and the full salary of that position. However, you’ll get no credit for that period of service when you leave it. In other words, you won’t be eligible for either a supplemental or a redetermined annuity.

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Resuming creditable service

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Q. I have been working for the federal government for just over two years. I am planning on moving in the next few months. I have applied to federal jobs, as well as private-sector jobs and have, so far, heard back from the private-sector jobs. I read that the Thrift Savings Plan is vested at three years and that employees are entitled to retirement benefits after five years. If I were to leave the federal system at this point, would I be able to return to the system in the future and “restart,” as it were, at my two-year mark?

A. Reg: Yes, you could, if you didn’t take a refund of your contributions when you left. If you did take a refund, you’d have to re-deposit that money when you returned to get any credit for that time.

Mike: Your service credit for use in meeting the three-year TSP vesting requirement will pick up where it left off, but any automatic agency contributions that were forfeited when you separated will not be restored.

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Service computation date

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Q. I am currently on active duty. Prior to that, I was employed in the federal Bureau of Prisons. What would be my service computation date: the date I began as a civil servant or the date I came on active duty?

A. For retirement purposes, your SCD would be the date you entered on duty as a civilian employee of the federal government. Your period of active duty wouldn’t be included in determining your length of service unless you returned to a federal civilian position and made a deposit to the retirement fund for that period of active-duty service.

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