Search:

Custom Search

Photo of Ralph Smith

House Passes Legislation To Increase Federal Annuity Payments for Some

By Ralph Smith

Thursday, July 31, 2008

You can have daily headlines from FedSmith.com delivered right to your desktop each business morning. The service is free and you don't get junk e-mail as the price of your subscription. Just visit our newsletter page to sign up!

What does a bill with a title like the Family Smoking Prevention and Tobacco Control Act have to do with sick leave for federal employees or with the Thrift Savings Plan for federal employees?

Legislation passed by Congress often appears to be addressing one topic but actually concerns something completely different.

Take, for example, the Family Smoking Prevention and Tobacco Control Act. The purpose of this bill is to protect public health by providing the Food and Drug Administration with certain authority to regulate tobacco products.

While the legislation does deal with smoking and the Food and Drug Administration, it also concerns sick leave for federal employees--without regard to their smoking habits or other use of tobacco.

My guess is that most FedSmith readers will have a greater interest in the sick leave provisions of this bill that was passed by the House in July 30th. The bill will have an impact on the unused sick leave for employees who are under the FERS retirement system. Here is what this new law would do and who it would affect.

1. A federal employee who retires within 3 years after the date of enactment, 3/4 of the days of unused sick leave to his credit under a formal leave system will be used in computing an annuity payment.

2. A federal employee who retires after 3 years from the date of enactment the days of unused sick leave to his credit under a formal leave system will be used in computing an annuity payment.

In plain English, this means that federal employees who are under the FERS system would count their unused sick leave toward the computation of their retirement annuity in the same manner as employees under the Civil Service Retirement System (CSRS).

While federal employees get the same amount of leave under both systems, the difference between the systems is that CSRS employees got a better deal when computing a retirement annuity. Those federal employees under the FERS system routinely use more sick leave than those in the CSRS, presumably because the CSRS employees get credit for the leave when they retire. The House bill would, presumably, cut down on the higher sick leave usage by FERS employees if the Senate goes along with the House bill.

© 2009 FedSmith Inc. All rights reserved. This article may not be reproduced without express written consent of FedSmith Inc.

Add a Comment about this Article

** All fields are required.
Note: Your comments will not show up right away. FedSmith.com selects the most insightful comments from our readers for posting. If selected, your comments will show up in the comments section after they have been reviewed and approved. See our terms of use for more information.

Readers' Comments

  • Regarding using unused sick leave balance when calculating retirement annuities for FERS employees, why can't this be made retroactive? I had 1,000 hours that I did not abuse, but gave back!! I know this would require re-computing annuities, but it can and should be done!!...
    Posted: October 30, 2008 3:52 PM
  • If they are going to change this for the FERS, who can keep their sickleave and have government contribute to their TSA and also be able to collect their Social Security if they are entitled. Now for us as CSRS and had worked in private industry before comming to the government, the unfair treatm...
    Posted: October 30, 2008 8:53 AM
  • For all of us in FERS. If you are sick, take sick leave. If you are not sick and take sick leave it is fraud. Plain and simple!! Honest or dishonest, what is it?...
    Posted: October 25, 2008 3:39 PM

View All Comments »

MORE BY RALPH SMITH

Contact Ralph Smith or read more articles on the author's page.