One of the most important benefits provided to federal employees is annual leave. With the end of the leave year rapidly approaching (it’s January 9, 2016), I thought it would be a good idea to spell out the basic rules governing that benefit, and how it can pay off when you retire.
The amount of annual leave you earn is based on your years of federal service, including creditable military service.
However, credit for military retirees is generally limited to those who retired on the basis of a combat disability or for service performed during a war. (By law, the latter period includes all service performed between December 7, 1941, and April 28, 1952.)
Credit may also be granted to those participating in a campaign or expedition for which a campaign ribbon was authorized.
If you have less than three years of service, you earn 13 days leave per year (four hours per pay period); if you have more than three but fewer than 15, you earn 20 days (six hours per pay period); and if you have 15 or more years, you earn 26 days (eight<TH>hours per pay period).
If you are a part-time employee with fewer than three years of service, you earn one hour of annual leave for every 20<TH>hours you are in a pay status; if you have three but fewer than 15 years, you earn one hour for each 13 hours; and if you have 15 or more, you earn one hour for each 10 hours.
As a rule, if you want to take annual leave, it must be approved in advance by your supervisor. However, there are circumstances where that may not be necessary.
For example, if you are dealing with a personal or family emergency or during inclement weather when your agency may open on time but permit non-emergency personnel to take unscheduled leave.
Under current law, most non-Postal Service employees can accumulate 30 days of annual leave (240 hours). However, there are exceptions. For example, overseas employees may accumulate 45 days (360<TH>hours), and those in the Senior Executive Service even more. (see below). Postal Service bargaining unit employees have an annual limit of 55 days (440 hours) and Executive Administrative Schedule employees, 70 days (560 hours).
Originally, SES members were able to accumulate an unlimited amount of annual leave.
That changed with the Government Management Reform Act of 1994. Beginning on the first day of the first pay period starting after October 13, 1994, a It set a 720-hour (90-day) limit was set on the amount that current and future SES members could carry over from one leave year to the next. However, the law included a grandfather clause that allowed current SES members who had accumulate more than 90<TH>days of annual leave to keep that higher figure as their personal leave ceiling. That figure became the maximum amount that could be carried from one leave year into the next one.
If you accumulate more than the annual limit, with certain exceptions, you have to either use or lose those excess hours by the end of the leave year.
For example, if you moved from a higher leave-ceiling job to a job with a lower leave ceiling, you can retain the amount you brought with you. Also, if you had to forfeit annual leave that was scheduled in writing well in advance, either because of illness or agency needs, that leave can be restored. In general, this restored leave must be used within two years. (The Postal Service has no provision for restoring forfeited annual leave.)
You will receive a lump sum payment for accrued and unused annual leave when you either leave government or retire. A lump-sum leave payment represents all the days you would have worked if you had remained in federal service. (By law, holidays are counted as workdays when making that projection.)
The lump-sum payment is based primarily on your rate of basic pay plus any locality pay or similar geographic adjustment. However, it may also include other types of pay, such as administratively uncontrollable overtime, supervisory differentials, regularly scheduled overtime pay under the Fair Labor Standards Act, non-foreign area cost-of-living allowances and post differentials, and foreign area post allowances.
For non-SES, non-foreign area employees, the maximum amount of hours for which a lump-sum payment will be made is 240 hours (the maximum amount of leave one can carry over from one leave year to the next), plus any additional leave accumulated during the year prior to retiring.
When you receive your lump-sum payment, a number of deductions will have been taken out of it. For example, federal and state income taxes, Medicare taxes, and Social Security (FICA) taxes (if you are a FERS-covered employees). However, no deductions will be taken for such things as health and life insurance premiums or TSP contributions.
Because the lump-sum payment is projected forward, if you are reemployed by the federal government before the expiration of the lump-sum leave period, you’ll have to pay back the portion of the payment that represents the time between the date of your reemployment and the expiration of the lump-sum period. The days you buy back will be re-credited to your annual leave account.
Note: If you are retiring, your annual leave can’t be used to increase your length of service nor can it be used in determining your high-3 average salary. You’ll just have to settle for a lump-sum payment.