Congress Approves FERS Sick-Leave Credit

At long last! After a protracted campaign, postal and federal workers who retire under the Federal Employees Retirement System (FERS) will receive credit for sick leave when they retire. The new benefit was included among a number of pay and retirement provisions in a compromise version of the 2010 Defense Authorization bill, which the Senate approved 68-29 on Oct. 22.

The bill was approved in a House-Senate conference on Oct. 7, and the House adopted the measure the following day. The legislation will now be sent to President Obama, who is expected to sign it into law.

The bill includes a provision long-sought by the APWU and other organizations representing federal employees, which would allow FERS-covered workers to receive a 50 percent credit for unused sick leave until Dec. 31, 2013. Starting on Jan. 1, 2014, they would receive full credit. Employees covered by the Civil Service Retirement System (CSRS) already receive credit for sick leave when they retire.

“This is a great accomplishment,” said APWU Legislative and Political Director Myke Reid. “We have always believed sick-leave credit for FERS employees is a matter of basic fairness.”

The original legislation was written by Rep. Jim Moran (D-VA), who said the measure provided a financial incentive, because employees covered by the provision would avoid taking unnecessary time off toward the end of their careers.

The Defense bill — including the FERS benefit — was passed by the House on June 25, by a vote of 389-22. But the campaign for the sick-leave credit was dealt a setback a month later when an amendment granting the benefit was withdrawn at the insistence of Sen. Tom Coburn (R-OK), who threatened to filibuster. “Until this amendment is withdrawn, I will stay here, or I will have a colleague stay here, and we will talk about how this country is out of control in its spending,” he said. “We’ve institutionalized sick leave. We’ve made it an entitlement.”

Sen. Daniel Akaka (D-HI), the main sponsor of the amendment, agreed to withdraw it, but continued to defend the provision, saying, “This amendment will ensure that all federal employees are treated the same.” Ten weeks after he withdrew the provision, Akaka was instrumental in getting it through the House-Senate conference committee, Reid said.

Rep. Edolphus Towns, (D-NY), the chairman of the House Oversight and Government Reform Committee, and Rep. Stephen Lynch (D-MA), chairman of the House Oversight and Government Reform Federal Workforce Subcommittee, were also key to the effort to convince conferees to include the sick-leave credit and other workforce provisions.

The compromise legislation also includes a provision that would make it easier for federal agencies, including the Postal Service, to rehire retirees (for a limited time) without forcing them to take a cut in their annuity checks. “This provision will help eliminate the USPS objections to APWU’s efforts to return postal retirees to employment,” Burrus said. “If the bill is passed, the union will renew our discussion with management on this issue.”

The bill also includes:

• A provision that would allow employees who choose to work part-time toward the end of their careers to use a higher salary figure in calculations for how the reduced work factors into their retirement benefits.
• A provision that would move workers in Hawaii, Alaska, the Virgin Islands and other U.S. territories from cost-of-living adjustments to a locality-pay system. [The territorial COLAs, as they are known, would be applied differently to postal employees than to other federal workers. The T-COLAs would not be taxed and would not be credited towards retirement; for other federal employees these earnings would be taxed and would be credited toward retirement.]
• A provision that would allow FERS employees who left and then returned to government service to redeposit savings in the retirement system and earn credit for years they had previously worked.