One of the best benefits of federal employment is the fact that you can earn annual leave. And you can use it for whatever purpose and, within reasonable limits, when you want to. Further, you can cash it in when you retire. Not bad.
The basic rules on leave accrual are simple, and they’re the same for all full-time general schedule, wage system, and Postal Service employees, regardless of the retirement system you are in. The amount you earn depends on your years of federal service. If you have fewer than three years of service, you earn four hours per biweekly pay period (13 days a year). If you have more than three but fewer than 15 years of service, you earn six hours per pay period (20 days per year). Once you reach 15 years of service, you earn 8 hours per pay period (26 days a year). Note: As a recruitment tool, agencies have authority to allow leave accumulation at higher than the minimum rates for newly hired employees who have outside work experience comparable to what the government requires.
Senior Executive Service members and other senior level scientific and technical employees earn 8 hours of annual leave per pay period (26 days a year) regardless of the number of years of service they have to their credit.
If you are a part-time GS, wage or PS employee, the amount of leave you’ll earn is based on your years of service and the time you are in a pay status.
The amount of annual leave you can carry from one leave year to the next depends on which employment category you are in. GS and wage employees may carry over a maximum of 240 hours (30 days). Any leave above that level is called "use of lose" because if you don’t use it before the leave year ends, you’ll lose it. If you are employed overseas, you can carry over 560 hours (45 days). If you are a Postal Service employee in a bargaining unit you can carry over 440 hours (55 days). Postal Service Executive and Administrative Schedule employees may carry over a total of 560 hours (70 days). If you are in the Senior Executive Service, you have a 720 hour limit (90 days) unless you had more than that amount on October 13, 1994 when the limit was created. That number became your personal limit. There are certain exceptions to the use or lose requirement but these are rarely invoked.
In general, if you retire before the end of a leave year, you’ll be given a lump-sum payment for all the annual leave you have to your credit when you retire. The amount you’ll receive will be based on the hourly rate of basic pay you would have earned had you stayed on the job until your leave ran out.
It’s a little different for Postal Service bargaining unit employees. You can be paid for any leave you carried over from the previous year and any additional leave you earned during the year you retire, not to exceed the carryover limit for your bargaining unit.