Annual leave lump sum payment consideration


Q. I’m a FERS DoD employee, planning to retire on Dec 31, 2011 to maximize my annual leave lump-sum payment.  Dec 31 is the end of a pay period, and the end of the leave year.  It’s also the end of my 104 week waiting period for my step increase from step 5 to step 6, which is due on Jan. 1, 2012.  I understand that annual leave lump-sum payments are calculated based on what I would have earned had I stayed in federal service. Am I considered to have fulfilled my waiting period, since the step increase would become effective the next day, or do I need to be “on the job” on Sunday, Jan 1 in order to have my annual leave payment calculated at my step 6 pay rate? I realize that this sounds like a special case, but many of us who came out of NSPS in 2010 have a “Date of Last Equivalent Increase” of Jan 3, 2010, the effective date of the NSPS payout, not the date of our re-entry into GS.  There may be someone else in the same boat as I am, considering how many of us exited NSPS in 2010.

A. You would only be eligible to have the step increase included when calculating your lump-sum payment if the waiting period was met on date of separation, not after. See


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Reg Jones was head of retirement and insurance policy at the Office of Personnel Management. Email your retirement-related questions to

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