A proposal to provide credit for unused sick leave credit for employees under the FERS system keeps popping up. It also keeps getting passed by the House of Representatives but doesn’t get through the Senate.
The amendments to expand employee benefits are often attached to bills that are primarily designed to accomplish some other purpose and the amendments may have little, if any, applicability to the primary legislation. (See The Proposed Federal Employee Benefit That Won’t Die)
Most recently, it was passed by the House as part of a bill on tobacco legislation but it was dropped by the Senate when the bill on tobacco was passed. (See TSP Changes Adopted in Tobacco Bill–Sick Leave Provisions for FERS Dropped in Final Legislation)
Then, after having been dropped by the Senate, it got through the House 404-0 on a vote the day after it was introduced. That was approximately one month ago.
But, as often happens in Congress, legislation that easily passes in one chamber does not become a law. In a development that will certainly disappoint some readers who are under the FERS system, an amendment that would have expanded federal employee benefits, including the provision that would have provided credit for unused sick leave by FERS employees who are retiring, has been dropped.
The problem is that expanding federal employee benefits at a time when many private sector workers are losing their jobs is not a popular issue. Federal employee jobs are generally more secure than private sector jobs during a declining economy. With unemployment hovering around 10% and a number of private sector workers losing their jobs or seeing their incomes decline because of fewer working hours being available, expanding federal employee benefits can be politically unpopular. And, of course, this same economic reality could have an impact on the final federal employee pay raise for 2010 as well. (See Your 2010 Pay Raise: 2%, 2.9% or 3.4%?)
The amendment that has been dropped had been attached to the Defense authorization bill for 2010.
In addition to the sick leave provisions, the amendment would have:
- allowed FERS workers to redeposit retirement funds collected after leaving government upon returning to government employment;
- modified how the Civil Service Retirement System calculates annuity payments for employees who retire as part-time workers.
- provided locality pay to federal employees who are working in the United States and its territories and possessions.
Some readers have asked for advice on whether they should retire or delay their retirement as they may get a higher annuity if they get credit for unused sick leave.
When we were asked for advice the last time the amendment was defeated in Congress we wrote: "If you are eligible to retire, and you think you are ready to retire from a financial standpoint and are ready to make the psychological adjustment, you should go ahead and retire at a time that makes the most sense for you."
Setting your retirement date is a personal decision that is driven by a number of circumstances, many of which are unique to an individual. Our advice on setting your retirement date has not changed. (See FERS Sick Leave Changes Dropped in Senate Bill: What Impact Should This Have on Your Retirement)
You should work to control your own future and make decisions that make the most sense for your personal circumstances. As events of this year have demonstrated, there is no guarantee that this change to the FERS system will happen this year–or if it will happen at all. Your retirement future should not be dependent on the whims of Congress which are beyond your control and are unlikely to have a major impact on your annuity payments in any event.