Early-outs without a buyout - would you bite?

Tuesday - 3/19/2013, 2:00am EDT

Back in the 1950s, Frank Sinatra had a big hit with a song called "Love and Marriage." The theme was that there cannot be love without marriage, and vice versa. That was a really long time ago!

The government version of love and marriage is the linkage between VSIPs and VERAs. One is the Voluntary Separation Incentive Payment (those $25,000 buyouts) and the other is the Voluntary Early Retirement Authority. One offered you cash to leave and the other gave you the option to retire early (and get an immediate annuity and keep your all-important health insurance). In the case of the early-outs, people could retire any time at any age if they had 25 years of service or at age 50 with 20 years service.

Buyouts are most cost-effective for the government when offered in the first three months of the fiscal year (October, November and December). Early-outs work anytime. When the government started offering the two options, it found that very few people would retire early unless they got a buyout to sweeten it. Only 1 or 2 percent of the people offered a standalone early retirement actually took it. But things may have changed.

After two-plus years of a pay freeze and with furloughs and maybe layoffs in the future, a large number of employees seem to have had it. We've been contacted by scores of workers who said they would leave if offered early retirement. For instance:

  • "Show me the money! Nope, on second thought, forget the money. Show me an early-out offer and I am gone. I would love a buyout to be sure. However, things are so bad, morale is so low (including mine) that I would retire in a heart beat. My agency offered early-retirement incentives two years ago but without buyouts. Almost no takers at least in my shop. However, times have changed and my salary hasn't. At least retirees get cost-of-living adjustments. Announce an early-retirement offer and get away from the door." — Ready to Roll

  • "I am ready, willing and oh-so-eager to leave. A buyout would be nice, but that is unlikely this late in the fiscal year. So yes, give me a shot at a VERA and stand aside." — Mick at the IRS
Although some say they would settle for half a loaf, many are also holding out for both a VSIP (buyout) and VERA (early out). Like this Air Force employee in Dayton, Ohio:

  • In response to your Monday column about the age of federal employees, I'm on the other end. I was turned down for an early retirement three times last year. I want to retire (under CSRS, I have the years but am only 53 years old). Warner Robins Air Logistics Center and Barksdale Air Force Base are having VERA/VSIPs, but I need one at Wright Patterson AFB. I know some people (that are fully eligible to retire) are waiting for a VSIP and won't go without one.

  • "With furloughs, I don't understand why there is no effort (and was none) to reduce personnel. DoD plans to furlough employees for 22 days in FY13, but when FY14 rolls around, personnel costs have not been reduced. So I would expect furloughs again. I want to retire (and can't), and others do not want a reduction in pay but have to be furloughed. — Just Offer the VERA/VSIP and I am Gone!
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The deadline to apply for a college scholarship from the Federal Employees Education and Assistance Fund (FEEA) is March 29. The program is sponsored by charitable contributions from rank-and-file federal workers and retirees as well as some very generous corporate contributors. For more information and an application, click here.


NEARLY USELESS FACTOID

Compiled by Jack Moore

The word "pencil" comes from the Latin word "pencillus," which means "little tail."

(Source: Today I Found Out)


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