Retirement Benefits

OPM has put out additional guidance on the effects of a law change enacted late last year involving the non-foreign area COLA system for federal employees outside the contiguous states. That system is being phased out over three years and being replaced by locality pay, but in the interim, employees receiving those COLAs who retire have the option of making payments to have the COLAs count toward their retirement calculations.

The guidance says that agencies must contact those who retired in the early months of this year to inform them of the opportunity to make a deposit to increase their annuities and provides guidance for those in other special situations, such as those receiving special rate pay, those on retained rate pay, and those paid under certain pay systems.


Meanwhile, Congress is considering various technical fixes to the law that likely will spur the need for further guidance.