FEDweek

OPM’s Advice to Agencies on Using Early Outs, Buyouts

In a recently issued guide to “reshaping”–in essence, reducing–federal agency workforces, OPM offered several suggestions to agencies for the use of early retirement and buyout authorities.

The guidance was issued before any agencies had announced definite plans to offer the incentives–the EPA has since committed to them, the State Department reportedly plans to announce its own plan soon, and many other agencies may follow suit–due to budgetary pressures and the administration’s mandate for agencies to reorganize and reduce their employment.

The guidance encourages agencies to offer both types of incentives, calling early outs–voluntary early retirement authority, or VERA–“a valuable tool that helps an agency create placement opportunities for employees who would otherwise be involuntarily separated or downgraded, and by avoiding displacements in actual RIFs.”

“Agencies may make decisions relative to which employees will be covered by VERA, how long to open the window for VERA, and how many employees may retire under VERA. The agency decides which employees are covered by VERA, based on nonpersonal factors related to the employee’s position (e.g., grade, series, title, organization, duty location).”

However, it adds: “Before requesting VERA from OPM, agencies should consider other RIF avoidance alternatives such as furlough, hiring freezes, reassignments, etc. An agency should not use VERA as a quick fix for a short-term problem, such as to achieve short-term budgetary savings for the remainder of the fiscal year.”

Regarding buyouts, also called voluntary separation incentive payments, or VSIPs, saying that “Agencies with prior VSIP authority reported that buyouts were a successful tool that notably increased voluntary attrition,” especially when paired with early outs.