Q: After 25 years’ service, I retired from a USG agency in February 2008, accepting an early retirement offer which included a Voluntary Severance Incentive Payment of $25,000. (After withholding tax was deducted from this VSIP, I actually only received just more than $16,000.) I was told that, for five years, post-retirement, I was barred from working for the federal government, unless an agency obtained a waiver to employ me directly or unless I repaid the VSIP. Otherwise, I would have to work for and as a contractor.
My situation raises a few related questions:
1. If I wanted to pay the VSIP back and resume working for the USG, why would I have to pay $25,000, when I never received that amount? Only $16,000 was transferred to my bank account. To have to pay a full $25,000 would unjustly enrich the federal government, wouldn’t it (as the withholding of over $7,000 from my VSIP essentially was a transfer of funds from one federal pocket to another, without any gain to me)?
2. I’ve been told that a recent Defense Appropriations Act included a provision authorizing/encouraging re-employment of federal annuitants, at least for limited periods, but people I speak to with my old agency seem to have no knowledge of this new policy or how to implement it. How can I best educate them on the new law, cite it (and any implementing regulations or policy guidance) to them, and quickly help them learn how to apply it to rehire people like me, having specialized skills, experience, and training?
3. I feel that a strong case can be made for an OPM waiver which would allow my re-employment within the five-year period, in view of my specialized abilities and security clearance. Can such a waiver also eliminate the requirement of VSIP repayment? And, if not, can arrangements be made which would allow for the VSIP to be repaid via periodic paycheck deductions (since the VSIP has already been used to pay my child’s college tuition), rather than paying it back in one lump sum?
A: If you received a buyout and later accept a paying job with the federal government within 5 years of the date of the separation on which that buyout is based, including work under a personal services contract or other direct contract, you must repay the entire amount of the buyout to the agency that paid it to you. As a rule, it must be paid before your first day of re-employment. A waiver of the requirement to repay a buyout may only be granted by the head of an agency when there is no other qualified candidate for the position.
Public Law 111-84, the National Defense Authorization Act for 2010 permits, but does not encourage, the part-time re-employment of nondisability annuitants on appointments that are limited to a year or less. The law spells out the criteria circumstances under which the use of this authority would be appropriate. It’s up to the agency to decide if an appointment is called for based on its demonstrated need and its budget. If it does approve the hiring of such an individual, he may receive both his annuity and the salary of the new position; however, he won’t be entitled to any additional retirement benefits based on that period of re-employment.