Expert's View

Federal employees and retirees have been hoping for changes in the laws that govern their lives. And more often than not, they’ve been disappointed when bills introduced in the Congress went nowhere, year after year. Well, that is about to change when the National Defense Authorization bill for fiscal year 2010 becomes law.


Among its many provisions, the bill includes the following changes:

• Allows former federal employees who receive a federal annuity from other than the Civil Retirement and Disability Fund to retain their annuity if reemployed by DoD under a special authority there.

• Authorizes federal agencies to reemploy retired federal employees under certain limited conditions, without offset of an employees’ annuity against their salary, and requires the Comptroller General to report on the use of this authority.

• Phases out cost of living allowances for federal employees working in Hawaii, Alaska, and other non-foreign U.S. territories, and would phase in locality comparability pay in place of the allowances.

• Phases in the allowance of unused sick leave to be applied toward length of service for purposes of computing a retirement annuity under the Federal Employee Retirement System.

• Provides certain District of Columbia employees whose positions were converted into federal positions with pension credit for their service prior to the transition for the purpose of determining federal retirement benefits.

• Allows former federal employees under the Federal Employee Retirement System who withdrew their contributions to the retirement trust fund, thereby waiving retirement credit for those years of service, to redeposit their earlier contributions, plus interest, upon reemployment with the federal government.

• Allows employees under the Civil Service Retirement System to take their highest salary, including their deemed full-time salary for years of part-time work, to be used in computing benefits derived from a pre-1986 salary.

There’s every reason to believe that this bill will pass both houses of Congress and that the President will sign it into law. However, it will be some time before the changes noted above will be converted into regulations and guidance provided to agencies.  Keep tuned.