F.E.R.S.

What types of benefits does the FERS BBP provide?
The FERS BBP provides retirement, disability and survivor annuities to supplement similar benefits provided by Social Security. How long does an employee have to work to become “vested” under the FERS BBP?
An employee must have five years of creditable civilian service to be eligible for retirement benefits and 18 months of creditable service to be eligible for dis- ability and survivor benefits.
How much does an employee pay for FERS retirement benefits?
FERS employees hired before January 1, 2013 contribute 0.8 percent of their basic pay for FERS basic benefits. Employees hired on or after January 1, 2013 pay a contribution rate of 3.1% for FERS basic benefits. Those hired on or after January 1, 2014 pay a contribution rate of 4.4%.
Do FERS Employees contribute to the BBP in addition of Social Security?
Yes. FERS was planned so that an employee’s annuity plan contribution rate, when added to the contribution rate for OASDI (Old-Age, Survivors, and Dis- ability Insurance program, usually known as Social Security), approximates the contribution rate CSRS participants pay. However, laws passed in 2012 and 2013 dramatically increased the amount that newly hired career employees (starting in 2013) contribute, without any increase in benefits.
Does the Postal Service contribute towards FERS employees’ retirement benefits?
Yes.
Is credit for FERS benefts given for periods of leave without pay (LWOP)?
Credit is given for up to six months of leave without pay in any calendar year. No deposit is required (except for periods of LWOP when military service interrupts civilian service, in which case deposit must be made in order to receive service credit. If receiving benefits from the Office of Workers’ Compensation Programs, credit is generally given for the entire period of compensation if the employee is carried on the agency rolls in a leave without pay status. Public Law 108-92 allows a 1% annuity enhancement for certain FERS employees who retire after October 3, 2003 and have at least 2 months of cumulative LWOP while receiving Worker’s Compensation benefits.
So FERS employees get service credit for unused sick leave under FERS?
FERS employees receive full credit for unused sick leave. See the following chart for converting unused sick leave into increased service time credit for higher annuity. Note that credit for unused sick leave does not count toward retirement eligibility. Service credit for unused sick leave is only used in the FERS basic benefit calculation. It is not included in the FERS annuity supplement calculation. Days of unused sick leave are used only to determine the number of years and months of service for annuity computation purposes; they cannot be used to compute the employee’s high-3 average salary or meet the minimum length of service required for retirement eligibility.
Can FERS employees withdraw their retirement contributions if they separate from government service?
Yes. FERS employees are entitled to receive a refund of their contributions to FERS, (plus interest, if the employee has more than one year of service). But they will no longer be able to draw a pension.
Can separated FERS employees who return to federal service redeposit previously drawn FERS contributions to get credit for prior service under FERS?
FERS employees who leave government service and receive a refund of retirement contributions are able to redeposit those funds plus interest back into the retirement fund upon reemployment.