Last time I wrote about the Voluntary Early Retirement Authority (VERA), which allows employees who meet the age and service requirements to retire early. To refresh your memory, here are the criteria: age 50 with at least 20 years of service or any age with 25.
This time I’ll talk about the Voluntary Separation Incentive Program, which can be used as a stand-alone authority or in combination with a VERA.
An agency may only offer a VSIP, which is commonly referred to as a buyout, to the extent necessary to eliminate specific positions identified in its strategic plan, a plan that has been approved by OPM and OMB and is on file with the appropriate congressional committees. (Note: DoD has a separate authority that does not require OPM/OMB approval.) The amount of the payment is equal to the lesser of your severance pay calculation, $25,000, or an amount determined by your agency head.
Setting aside the cash payment feature, the big difference between a VSIP and a VERA is that you don’t have to be eligible to retire to accept a VSIP. That’s because the purpose of the buyout is to encourage employees in specific positions to leave government. As such, it’s designed to be a mind changer, as in “I wasn’t planning to leave but since they are handing out money, I’ll take the money and run.”
Not surprisingly, there are rules about who is and isn’t eligible for a VSIP.
To be eligible, you must:
1. Be serving in an appointment without time limit;
2. Be currently employed by the Executive Branch for a continuous period of at least 3 years;
3. Be serving in a position covered by an agency VSIP plan (i.e., in the specific geographic area, organization, series and grade); and
4. Apply for and receive approval for a VSIP from the agency making the VSIP offer.
You aren’t eligible for a VSIP if you:
1. Are a reemployed annuitant;
2. Have a disability such that you are or would be eligible for disability retirement;
3. Have received a decision notice of involuntary separation for misconduct or poor performance;
4. Previously received any VSIP from the federal government;
5. During the 36-month period preceding the date of separation, performed service for which a student loan repayment benefit was paid, or is to be paid;
6. During the 24-month period preceding the date of separation, performed service for which a recruitment or relocation incentive was paid, or is to be paid; and
7. During the 12-month period preceding the date of separation, performed service for which a retention incentive was paid, or is to be paid.
Assuming that a VSIP is offered to you, should you accept it? Before you decide, you’ll want to read my next article, which will deal with what happens to your health and life insurance benefits if you leave government.