Civil Service Retirement System (CSRS) annuitants and Federal Employees Retirement System (FERS) annuitants who are reemployed in federal civilian jobs, including the U.S. Postal Service, generally have their pay reduced: they receive their full annuity, but their pay is reduced by the amount of the annuity they receive while employed. However, there are various exceptions to this general policy.
One of them allows agencies to rehire annuitants without an offset for up to 520 hours in the first six months after retirement, up to 1,040 hours during any 12-month period and up to 3,120 hours total. Allowable purposes for these “limited time” appointments include meeting mission needs, training or mentoring employees, responding to emergencies, and assisting in special needs including procurement actions and duties of the agency’s inspector general. Agencies must justify their actions if such hiring exceeds 1 percent of their workforce and in no case can reemployed annuitants exceed 2.5 percent.
Another is the “exceptional needs” authority, which allows for waivers for those hired into a position for which the Office of Personnel Management determines, on an agency request, that: there is exceptional difficulty in recruiting or retaining a qualified employee; there is a direct threat to life or property; or there are other unusual circumstances such as the need to meet a new or expanded mission requirement by a certain date or the need to appoint an individual with necessary clearances to perform critical work when no other employee could obtain that clearance within a reasonable time.
Those are the main two, but there are others, some specific to occupations, agencies or programs. If you are thinking of returning to the government as a rehired annuitant, be sure to check with the hiring office.