Howdy, Pardners! Here’s this week’s Federal Furlough Roundup!
Federal Times: January sees biggest spike in retirements in 3 years.
GovExec: House wants to cut headcount, not federal pay.
FederalTimes : Air Force ready to Furlough 180,000 civilians, cut pay by 20 percent.
- Delaying a Carrier Battle Group deployment for financial reasons is unprecedented. However, since the CNO has already stated the Navy is cutting Surface Ship and Aircraft maintenance through the end of the Fiscal Year, this makes sense. There’s no way to operate a battle group without gas, working surface warships, and aircraft that can safely fly.
- January saw a spike in Federal Employee retirements, in spite of the “No FERS employee retires in 2013 Act“. I’m eating crow on this one. Administrative Furloughs have recently been discussed here, and it seems this stuff is about to get real.
- I’ve seen a lot of concern posted online regarding the effect of potential furloughs on FERS retirement pay/calculations. The short answer is that in most cases there will be no effect.
Detailed FERS Retirement analysis: There are two effects of concern on your FERS/CSRS annuity calculation- first is your Length of Serivice, the second is your Base Pay.
FERS handbook section 50A2.1-3. Length of Service allows up to 6 months of nonpay (spoken: furlough) in aggregate per calendar year.
A. Creditable Service for Computation Purposes (Cont.) …
7. Time in a nonpay status (for example, leave without pay, suspension, furlough, and absence without leave) that does not exceed 6 months in the aggregate in any calendar year.
Per CSRS/FERS handbook section 50A2.1-5, Basic Pay Rate is Annual salary divided by pay period. It does NOT state t hat Base Pay is WHATEVER YOU WERE ACTUALLY PAID. Ch50 then refers to CH30 of FERS/CSRS handbook, which states:
Section 30A1.1-2 Basic Pay
A. Definition – The basic pay rate is the rate fixed by applicable law or regulation.
A. Definition – The basic pay rate is the rate of pay fixed by applicable law or regulation for a position.
The next part of the Annuity Calculation is Length of Service, which in most cases is unaffected by a furlough/loss of pay of up to 6 months’ time in any one calendar year:
Section 50A2.1-5 Basic Pay Rates
B. General – In computing the high-3 average pay, use the rate of annual basic pay–not the pay actually received by the employee–except as specified below.
The handbook then goes on to describe esoteric and exotic pay situations, like Administrative Judges working on the Isthmus of Panama while earning overtime as a Smoke Jumper… etc. Most of these exceptions apply to no one.
Bottom Line: The good news is that the potential administrative furlough should have no effect on CSRS/FERS retirement calculations… so it’s time to celebrate the possible 20 percent pay cut and go Thrift Shopping ! <warnings- NSFW, earworm alert>
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