Monthly Archives: October 2018

Federal Retirement 101–Part 2


As part 1 of this post showed us, it’s important to strategically pick your retirement date to maximize your annuity, especially if you’re a CSRS employee. Once you’ve done that, the real work begins, as they say. The following are steps you should take when you’re ready to retire.

Check Your Service History

You can do this at any point in federal career but be sure to check it before your file your CSRS/FERS retirement application. This is especially true if you’ve worked for other federal agencies or have served on active duty in the military. It’s important your agency has maintained a complete record of your service. Request a retirement estimate from your agency and ensure it includes a summary of your federal service. If it doesn’t, review your electronic Official Personnel Folder to verify it included the beginning and ending dates of every period of your credible federal service.

Be Sure to Have Copies of Important Forms

Just in case something should turn up missing (personnel action forms), you’ll have copies you could produce if needed.

Consider Service Credit Deposits

You may have the option to pay a service credit deposit to either receive credit for service or to avoid a permanent reduction in your retirement benefit. There are 3 types of service credit deposits:

  • Deposit to CSRS or FERS for civilian service that wasn’t covered by retirement deductions, called non-deduction service.
  • Redeposits or refunded CSRS contributions.
  • Deposits for post-1956 military service.

Ask Questions

If you don’t understand something, ask questions. If something looks off to you, try to understand. It’s better to ask questions now than possibly uncover a delay-causing problem later.

Keep Copies of Divorce Documents

If you have a former spouse who was awarded part of your retirement or survivor benefits, keep a copy of your divorce decree or court order.

Ensure You Can Retain Health and Life Insurance Coverage

FEHB and FEGLI are both able to be carried into retirement. Review the rules to maintain these a federal retiree. There is a 5-year requirement that must be met in order to keep these benefits.

Submit Your Application at Least 30 Days Before Your Planned Retirement Date

It’s common in many agencies to give 90 days’ notice of retirement. This allows the agency time to begin to put your retirement package together before you leave.

Attend a Pre-Retirement Seminar

Many federal employees lack knowledge about basic retirement considerations. A seminar is a great way to gain more knowledge and understanding.

If you have any questions about federal disability retirement and what your options are, please call us at 877-226-2723 or fill out this INQUIRY form.

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Federal Retirement 101–Part 1


Do you know which days are considered “the best days to retire”? Do you know what steps you need to take to begin the retirement process? This 2-part post will first look at which days are considered to be the “best days to retire” and why and then what you need to do first once you’ve determined when you’re going to retire.

It can be a confusing time so hopefully, this will shed some light on answers to these questions.

The “Best” Days to Retire

Is there a “best day to retire”? Typically, the concept of a “best day” is usually related to finances and maximizing your potential income. A “best day” is generally a personal preference too.

You can retire on any date you choose as long as you meet the age and length of service requirements. Once you meet these requirements, you can retire on any day of the month (1st, last, or any day in between), on a holiday, on a weekend, on an Alternative Work Schedule (AWS) day off, any time in a pay period, etc. You also don’t have to physically be in the office on your last day. Your “retirement date”, or the “effective date” for your retirement is your last day as an employee.

Here are the best days, financially, to retire in 2019 (going from BEST to BETTER, top to bottom):

Dec. 31, 2019 Jan. 3, 2020
Jan. 2, 2020
Jan. 1, 2020
Dec. 31, 2019
Last day of any month Last day of any month or 1st 3 days of a month


CSRS—Retiring on the first 3 days of the month is not advantageous. For instance, if you retire on a Saturday or Sunday and you’re not scheduled o work those days, then you’re not earning additional pay and are delaying the start of your annuity.

That was just the short version of the “best days to retire”. The long version is a bit more complicated.

Retire at the End of the Month or within the First 3 Days of the Month for CSRS

The end of the month is a good time to retire because of a provision in the FERS and CSRS systems—your annuity begins to accrue at the beginning of the month after you retire. If you retire effective May 31, your annuity begins June 1. There is no gap between when you are earning a salary and when you are earning an annuity.

If you retire mid-month, like May 10, you won’t receive any compensation at all (no salary, no annuity) from May 11-31.

Although, CSRS retirees have an exception to the rule. If they retire on the last day of the month or within the first 3 days of a month, their annuity begins the day after retirement; the very next day. Those extra 3 days may allow you to earn a little more full pay, it may add enough days of service to acquire an additional month of service credit (for a higher annuity), or it may complete a pay period (for more annual leave or sick leave) and your annuity will still commence the day after you retire.

Retire at the End of the Year or within the First 3 Days of January for CSRS

There are several reasons why the end of the year is better than just the end of the month:

  • Generally, you can achieve the highest possible High-3 average salary by working as long as possible at your final salary rate.
  • You can accumulate the most hours of annual leave toward your annual leave lump sum payment. If you roll the standard cap of 240 hours into the 2019 leave year and save all your annual leave during 2019, you would retire at the end of the year with 440 hours of annual leave that you will get paid for.
  • The hourly rate of pay used to calculate part of all of your lump sum payment may be higher if you retire at the end of the year with more than just a few hours of annual leave.
  • The taxes on your lump sum annual leave payment will fall into the 2020 tax year when your taxable income will generally be lower. If that large lump sum payment was received during the same year you received a higher salary, the total income for that year could change your tax bracket causing higher taxes. Therefore, receiving a lump sum payment in a year when you’re no longer working would result in fewer tax implications.

A word of caution though—be careful if you have a lot of annual leave. If you have more than the rollover cap (240 hours for most) and you stay past the end of the leave year (most likely January 4 in 2020), you’ll forfeit any leave over your cap.

So, once you’ve determined when you’re going to retire, the 2nd part of this post will look at what steps you should take to retire.

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MSPB Backlog of 1,500 Cases Likely to Grow

casesThe Merit Systems Protection Board hears federal employee appeals of contested personnel actions and could go from one member to none next spring.

“It will take, at a minimum, three years to process that backlog,” Mark Robbins, acting Chairman of MSPB said. “It’s looking increasingly like the Senate isn’t going to vote this year.”

The board is responsible for resolving a variety of personnel disputes for about 2.1 civilian federal employees.

Starting Over

President Trump will have to re-nominate the 3 people he’s picked or choose new board nominees in 2019 is Senate fails to vote this year. The process will then start over, beginning with the filing of required documents form the nominees and a new nomination hearing in the Senate Homeland Security and Governmental Affairs Committee.

Between 60-75 appeals of MSPB administrative judge decisions are added to the existing case backlog each month. “If you’re looking at another 6 months before a new board is in place, the backlog could be close to 2,000 cases,” Robbins said.

At full strength, the MSPB has 3 members. The board can’t issue final decisions on appeals of MSPB administrative judge rulings when it only has 1 member. With a 2-member quorum, the panel can issue final decisions but only if both members agree.

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Competitiveness of Federal Compensation


The Office of Personnel Management and the Office of Management and Budget will spend the next year studying the “competitiveness” of federal compensation with that of agency private-sector counterparts, per an update to the president’s management agenda. The two agencies are tasked with obtaining “market information” and studying “the federal government’s competitive posture in total compensation for civilian federal employees, to include base pay, benefits, and other relevant total reward elements.”

This effort is expected to be completed by September 2019.

The Congressional Budget Office, in 2017, found that federal workers make on average 17% more than employees in the private sector, however, some argue that that percentage doesn’t adequately account for differences in educational attainment and other issues.

In April, the Federal Salary Council used data from the Bureau of Labor Statistics to conclude that federal employees make nearly 32% less than private sector workers but that omits some non-salary elements of compensation.

Howard Risher is a consultant on pay and compensation issues who helped with the passage of the 1990 Federal Employees Pay Comparability Act. He thinks that the problem with both metrics for comparison is they are too broad.

The 2 reports attempt to capture compensation data on al private companies, big and small, rather than only comparable large businesses of at least 500 or 1,000 employees. Neither report adequately focuses on the compensation of workers who have the skills desired by federal agencies. Risher said, instead OPM and OMB should compile a series of local surveys of a subset of the workforce.

“What they should be doing is figuring out who they’re competing with for talent,” he said. “[Most] industries have an industry survey that’s done privately…What I would do is I would go out to the [Federal Executive Boards] in each of the major cities and regions and talk about what data would be useful in this area. You have to get people to agree about how to ‘price’ jobs in these cities, and then if there are local surveys that would be useful.”

Each company, when developing a benefits package, comes up with their own assumptions about how much a new hire is likely to make over the course of their career, how long they expect them to live after retirement, and other variables.

“The other big thing that’s important here is that if you go to corporations, it would be fairly common for senior management and even middle management and supervisors to provide some sort of stock ownership opportunity, and ignoring that is a big mistake,” Risher said. “And BLS specifically does not look at year-end incentive payments or any payout that is dependent on performance. So, a manager making $100,000 almost across the board will have an incentive of at least 10-15% of their salary, so you’re missing a big chunk of what they can earn.”

He went on to say, “you have to reach an agreement about what’s valid for this purpose, and a part of that is [getting buy-in] from unions. Unions, first of all, are democracies and when people get elected to those offices, they have to prove that they’re doing good work for the members of that union. And there’s an innate distrust that changes to the General Schedule are going to lead to people getting screwed…[OPM and OMB] need what they produce to be credible because there will just be people throwing rocks at it otherwise.”

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Federal Disability Retirement TRUE or FALSE

falseRetirement is often a confusing time, especially in the federal government. Do you retire on a regular retirementearly retirementphased retirement, or deferred retirement? Then, what happens if you are hurt or become ill and can no longer perform your job duties? Now you throw federal disability retirement into the mix. That’s a lot to think about, especially if you’re faced with an injury or illness.

So, let’s look at some true and false statements regarding federal disability retirement.

If I go out on a disability retirement, that means I’m disabled, so I can’t work anymore.

FALSE. When you are approved for a disability retirement, you are proving you can no longer perform your job duties for that specific position. It’s an occupational disability, not a total or permanent disability. In fact, if you are approved for federal disability retirement, one of the great benefits is that you can work in the private sector, doing pretty much anything you want, and earn up to 80% of your previous positions’ current salary.

I can keep my health and life insurance benefits with federal disability retirement.

TRUE. If you’ve carried coverage for the 5 consecutive years immediately leading into retirement, or for all periods eligible if less than 5 years, you can continue into federal disability retirement.

I will not receive a Cost of Living Adjustment if I go out on federal disability retirement.

FALSE. In fact, not only will you receive a COLA after the first 12 months of being on disability retirement, but you’ll also receive it every year after, so long as you’re eligible. Regular FERS retirees only start receiving COLA’s once they reach age 62.

I must be approved for Social Security Disability.

FALSE. It’s true you must apply for SSD when you apply for federal disability retirement from the Office of Personnel Management, but you do not have to be approved. These 2 disability programs are quite different and have very different qualification standards.

My medical condition must last for at least a year.

TRUE. You must have a documented medical condition that you are currently treating for and it must last longer than 12 months.

To be eligible, I must’ve worked for the federal government for years, right?

FALSE. While this technically true for CSRS employees (5 years of civilian service), there aren’t many CSRS employees out there that would still qualify for federal disability retirement. Under FERS, you only need to have 18 months of civilian service to qualify.

I have more than one chance to get approved.

TRUE. If you are denied at the initial stage with OPM, you have another shot at the Reconsideration stage. Here, you can submit new evidence. The process here is similar but the deadlines to file are much stricter. You even have another stage of appeal should you get denied at this level. Next, it will move to the Merit Systems Protection Board, which is a much more formal process, again with strict deadlines.

There are just a few of the most common questions we get from clients and potential clients. If you have any questions about these or other questions, please feel free to reach out to us at 877-226-2723 or fill out this INQUIRY form. We’d be happy to set you up with a FREE consultation and help in any way we can.

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More Federal Retirement Claims


The Office of Personnel Management released data showing that the number of federal employees who filed for retirement in FY2018 increased 24% over the previous year. OPM published its retirement processing statistics and it showed that 7,142 employees filed for retirement in September, which is the final month of the government’s fiscal year, bringing the total federal retirement claims in FY2018 to 105,298—a 24.1% increase over the number of claims from the federal workforce in FY2017, which had 84,807.

Many have warned of an impending wave of federal employee retirements, citing the fact that federal employees skew older than their private sector counterparts. In July 14% of the federal workforce was eligible to retire, and in 5 years, that number is expected to jump to 30%.

There has also been speculation that federal employees would leave service since the election of President Trump, but that hasn’t panned out. In fact, in FY2017, 10% fewer employees filed for retirement than in FY2016.

Donald Kettl, a professor and academic director at the University of Texas Lyndon B. Johnson School of Public Affairs, thinks a combination of factors has likely led to the spike in retirements this past fiscal year.

“Two theories are worth noting: one is that the long-predicted ‘silver tsunami’ is happening,” Kettl said. “The federal workforce is substantially older than in the private sector, so the inevitable might finally be occurring. That is even more likely with the stock market in record territory, as workers decide to cash in. The other is a Trump effect—the possibility that government officials are deciding to leave, given the high levels of tension in some agencies and proposals to downsize and reorganize others.”

Another potential factor has been the Trump administrations’ efforts to lower the federal government’s personnel costs, although this has not been successful. OPM acting director Margaret Weichert suggested that federal employees are not in government for the pay, however, recent data suggests that compensation does play a role in people choosing to retire. During the Obama administration, there was a freeze on federal employee pay from 2011-2013 and locality pay was frozen from 2010-2015. Federal employee retirements as recent as FY2016 totaled 94,985, 12% higher than FY2017.

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Direct Hiring Authority from OPM

authorityThe Office of Personnel Management announced it was adding new direct hiring authority for specific positions that have a critical need for additional talent. The memo was from OPM acting director Margaret Weichert and was sent to all agency heads.

This direct hiring will apply to Scientific, Technical, Engineering, Mathematics (STEM), as well as Cybersecurity and related positions. The memo notes that agencies may appoint individuals into the occupations identified in the list of positions at the specific grade levels (or equivalent) nationwide. Individuals may be appointed to competitive service career, career-conditional, term, or temporary positions.

The Trump administration also announced it will create a series of new pay systems to reward certain groups of employees. They will do this using existing authority the federal government has never used before.

Weichert announced the new initiative as part of a package of steps she’s implementing in her new role to boost recruitment and retention efforts. This is along with the expedited hiring authority for the positions mentioned above.

“OPM is planning a number of administrative guidance and legislative changes, as well as ways to work and learn from the private sector through public-private partnerships, to get people into government to focus on the things the American people need,” she said. “Layers and years of statute and added regulation have made it very complex and very cumbersome to operate nimbly and agilely in the 21st century.”

She said the changes would improve enforcement of the federal government’s merit system principles.

The Special Occupational Pay Authority was created in the 1990 Federal Employee Pay Comparability Act, but OPM said it has never been used. The law states that the president’s Pay Agent, consisting of the secretary of the Labor Department and the directors of OPM and the Office of Management and Budget, can establish an alternative pay system for job categories in which the normal standards “do not function adequately.” The Pay Agent must post a proposal in the Federal Register, submit the suggestion to Congress, hold a public hearing, and consult with affected agencies and unions. The base pay under the alternative system is capped at Executive Schedule Level 5, which is $153,800 for 2018, but the law doesn’t prohibit locality pay on top of that.

OPM will issue its first alternative pay system for economists in the federal government. The agency called it a “high-risk, mission-critical” occupation in need of a “new approach” for pay. OPM has created an interagency working group to identify additional occupations for a new pay and classification system. They expect to create proposals for 3-5 additional jobs over the next year.

The STEM/IT direct hire authorities were initially launched under the former OPM director, Jeff Pon. “OPM is aware that individuals with the knowledge, skills, and ability to perform in Science, Technology, Engineering, and Mathematics (STEM), and cybersecurity occupations are in heavy demand and that this demand could, perhaps, be affecting mission-critical functions,” Pon wrote in a memorandum earlier this year.

The STEM authority will apply to positions involving cybersecurity and operations, computer network operations, information assurance, and diplomacy, military, and intelligence missions related to information and communication infrastructure. This authority will be finalized in regulations next week, while the IT authority will require a combination of regulations and power.

OPM is moving forward on its reorganization plan and has taken steps on the administration’s proposal to consolidate background checks within the Defense Department and move many of OPM’s transactional functions to the General Services Administration.

“Independence [of OPM], if it’s not delivering the actual mission, isn’t of the primary concern,” Weichert said. She has met with the top career leaders at OPM and is planning a “walk around” to meet each of the agency’s teams.

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Proposed Shipping Price Increases by USPS

shippingThe United States Postal Service has proposed higher prices for its services creating an overall increase of 2.5% for its Mailing Services. If approved, the changes would take effect January 27, 2019. The notice of changes was filed with the Postal Regulatory Commission (PRC).

Proposed Mailing Services price changes include:

Letters (1 oz.)
Letters additional ounces
Letters (metered 1 oz.)
Outbound International Letters (1 oz.)
Domestic Postcards
50 cents
21 cents
47 cents
35 cents
55 cents
15 cents
50 cents
35 cents

**Courtesy of

Proposed domestic Priority Mail Retail Flat Rate price changes are:

Small Flat Rate Box
Medium Flat Rate Box
Large Flat Rate Box
APO/FPO Large Flat Rate Box
Regular Flat Rate Envelope
Legal Flat Rate Envelope
Padded Flat Rate Envelope

**Courtesy of

The proposed price hikes would raise Mailing Services product prices about 2.5%, but Shipping Services price increases vary by product. For example, Priority Mail Express will increase by 3.9% and Priority Mail will increase by 5.9%.

The one decrease shown above is for the single-piece additional ounce price which will be reduced to 15¢ from 21¢.

The Postal Services’ Mailing Services price increases are based on the Consumer Price Index (CPI), whereas the Shipping Services prices are primarily adjusted according to market conditions.

The Governors of the Postal Service approved the price increases and think these new rates will keep the Postal Service competitive while providing the agency with much-needed revenue. It still must be reviewed and approved by the PRC.

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Largest COLA Increase for Federal Retirees in Years


In 2019, federal retirees will receive the largest cost of living adjustment increase in years. The adjustment will be 2.8% of their benefits. The boost applies more broadly to recipients of Social Security benefits and it comes on top of a 2% increase in 2018.

The annual COLA is based on the percentage increase in the average Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W) for the 3rd quarter of the current year over the average CPI-W for the 3rd quarter of the last year in which a COLA became effective.

This 2.8% adjustment applies to retirees under the Civil Service Retirement System. Those under the Federal Employee Retirement System will receive 2%. There is a difference because FERS employees only receive the full percentage increase if it’s less than 2%. If the change is 2-3%, they get 2%, and if its higher than 3%, FERS retirees will receive one percentage point less than the full increase.

“CSRS retirees and Social Security recipients will be pleased to see their benefits increase by 2.8% in 2019, the largest increase since 2012,” said Richard Thissen, president of National Active and Retired Federal Employees Association. “Unfortunately, hundreds of thousands of FERS retirees will be wondering why they are only receiving a 2% COLA when the relevant measure of consumer prices increased by 2.8%. It’s past time for Congress to ensure FERS retirees receive a full COLA each year.”

President of the National Treasury Employees Union, Tony Reardon said, “As retired federal employees welcome the increase in their monthly pensions in 2019, it’s a good time to remind them and all future retirees that such routine cost of living adjustments cannot be taken for granted. The administration has not given up its plan to eliminate COLA’s for federal employees who retiree through the Federal Employees Retirement System, and severely cut them for those in the Civil Service Retirement System.”

The new COLA’s take effect starting with federal retirees’ December 2018 benefits.
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Can Your Agency Forcefully Relocate You?


When an agency decides to relocate an office, or the entire agency (this can be done for many reasons), can they force you, if you are employed by them, to relocate or risk losing your job? What options are available to you if you still want to keep your job without relocating?

Forced to Relocate

Yes, your agency, or your job, can be relocated and failure to relocate with it can be grounds for removal. Many federal employees may not know that. If the government wants to move you, it must pay for moving expenses, real estate fees, and temporary housing.

This really doesn’t happen too often. Large-scale relocations tend to generate congressional interest because no Representative or Senator wants to see jobs moving out of their district or state. Unions can also get involved here and local officials oppose losing local jobs. Still, relocations can happen.

Mobility Agreements

Some employees must sign mobility agreements as a condition of employment. If the employee declines a move, they can be fired for failing to satisfy a condition of employment. Of course, this doesn’t mean that only employees on mobility agreements can be ordered to relocate. Others can be ordered as well.

A case law, established in 1980, gives authority to an agency to fire an employee who refuses a forced move. When an employee isn’t covered by a mobility agreement, the agency has the burden to show they are making the move because of legitimate management reasons that would promote the efficiency of the service and give employees enough notice. If the agency can meet that burden and the employee can’t show the reason is a pretext, the Merit Systems Protection Board (MSPB) will typically uphold the removal. If the employee is covered by a mobility agreement, the removal is even easier for the agency to defend.

Agency Impact

Many questions come with this, such as how many employees relocate at once? What happens to the agency after that? Does the agency have money to complete the relocation?

Some answers lie within the Defense Department. They had multiple rounds of the Base Closure and Realignment Commission where they made decisions to relocate or consolidate organizations.

For a short move 40 miles away, a report showed 70% of employees relocated with their jobs when the Defense Information Systems Agency moved to Fort Meade, MD, 15% found other jobs, and 15% retired.

When agencies move smaller numbers of employees, the impact on the agency typically isn’t severe. However, if an agency wants to move 1,000 jobs and only 300 people go, the impact can be significant.

Congressional Approval

Congressional approval is only needed when the agency needs big money to pay for relocation. There may be congressional notification requirements, reprogramming requests, or money needed. If that happens, Congress will have a say and they’ll want to know the agency’s reasons for the move, how it plans to deal with workforce issues, and how it will mitigate the risk to the mission that may be caused by large numbers of employees refusing to relocate.

Most employees will never be asked to move, or be forced to move, but this is good information in case you ever find yourself in that situation.

Disability Retirement

Another thing you may consider in this situation is federal disability retirement. If you’ve been dealing with, or working through, an injury or illness and are having trouble performing the essential functions of your job, you may qualify. Give us a call at 877-226-2723 or fill out this INQUIRY form and we can schedule a FREE consultation with you.

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