If you are covered by the Civil Service Retirement System (CSRS) and retire on an immediate annuity, or you die while employed, unused sick leave is converted to months and days and added to your length of service for purposes of computing your retirement annuity and your spouse’s survivor benefit. The hours of sick leave are converted to years, months, and days on the basis of a 2087-hour work year.
If you are covered by the Federal Employees’ Retirement System (FERS), unused sick leave is not creditable for annuity computation purposes, with one exception. If you elected to switch (transfer) from CSRS to FERS and you have a CSRS component, you will receive credit for the amount of unused sick leave you had as of the date of transfer to FERS, or the date of retirement, whichever is lesser. The sick leave will be applied only to the computation of annuity based on service in the CSRS component.
Whether CSRS or FERS, if you apply for and are approved for a disability retirement, you may, if you wish, use all or a portion of accrued but unused sick leave prior to separating from employment. You must provide medical documentation supporting that you are unable to work during this period. The disability annuity would begin after you are separated from employment.