What is a VERA?
A Voluntary Early Retirement Authority (VERA) is commonly referred to as early-out retirement, and that’s exactly what this authority offers—an opportunity to retire in advance of meeting the age and/or service requirement normally needed for retirement.
VERA expands the normal retirement eligibility to allow employees to voluntarily retire, with an immediate annuity, before they would otherwise be eligible. There are some basic eligibility criteria under the law. You must also meet U.S. Department of the Interior (DOI) criteria. An early retirement may have an effect on your annuity.
Certain employees are excluded from early-out retirement. They are:
- Employees who have not been continuously employed by the DOI for at least 31 days before the date of the DOI-requested approval of the VERA.
- Employees serving under time-limited appointments.
- Employees in receipt of a decision of involuntary separation for misconduct or unsatisfactory performance.
Leaving Federal service under a VERA is supposed to be voluntary. What if I am offered a VERA or Voluntary Separation Incentive Payment (VSIP) but do not choose to leave?
VSIPs (buyouts) and VERAs (early retirement) are for voluntary separations and coercion is prohibited.
Can I retire under a VERA and also receive a VSIP?
Yes. If you meet the criteria for both, you can retire under a VERA and also receive a VSIP if one is being offered by the agency.
If I retire under a VERA and do not take the buyout, can I take a job in another Federal agency?
Yes, but if you come back as a reemployed annuitant your annuity will be subtracted from the salary you earn in the new position.
What if I obtain employment after retiring?
Non-Federal employment — There are no restrictions on non-Federal employment after a voluntary early retirement. EXCEPTION: Employees covered under FERS who qualify for the annuity supplement could have the supplement reduced or discontinued due to the earnings test.
Federal employment — If you are hired under a Federal appointment that provides for coverage under Civil Service Retirement System or Federal Employees Retirement System (generally non-temporary employment), then you will be considered a “reemployed annuitant.”
Eligibility
Who is eligible for a VERA?
If the USGS has received approval for a VERA, you must also meet some additional requirements. If you are covered by the Civil Service Retirement System (CSRS), you must have served in a position covered by the CSRS for at least 1 year out of the 2 years immediately before retirement. For employees covered by the Federal Employees Retirement System (FERS), this rule does not apply. You must be at least 50 years of age with 20 years of service or have 25 years of service at any age. At least 5 years must be civilian service, whether you are retiring under CSRS or FERS.
In addition,
- You must be in a position covered by the VERA as granted by the Office of Personnel Management (OPM);
- You must not be serving under a time limited appointment;
- You must have been employed by the agency at least 30 days prior to the date of application to OPM for VERA approval;
- You must not have been notified that you will be involuntarily separated for misconduct or unacceptable performance; and
- Your retirement date must be on or before the VERA expiration date.
Does the VERA eligibility change the eligibility for regular optional retirement?
No. If you are under FERS, you can take regular optional retirement if you have reached your minimum retirement age (MRA) with at least 30 years of service, age 60 with 20 years of service, or age 62 with 5 years of service. In addition, an employee under FERS is eligible for an immediate annuity if he/she has 10 years of service and has reached the MRA. (Under this eligibility there is a 5-percent reduction for each year the employee is under age 62.) The MRA chart can be found at the following link: http://www.opm.gov/retire/faq/faqs.asp.
If you are under CSRS, you can take regular optional retirement if you are 55 with at least 30 years of service, age 60 with 20 years of service, or age 62 with 5 years of service.
What if my agency offers a VERA but I am on military duty during the authority time limit?
Employees on military duty are treated as though they are still on the job, and are not disadvantaged because of their military service. Therefore, if you meet the eligibility criteria during the offer period, you would have 30 days following your return to your position with the USGS to either accept or reject an offer of VSIP or VERA.
This means the annuity will continue, and the Federal salary will be offset by the annuity. If you work at least 1 year full-time equivalent, then you may apply for a supplemental annuity. If you work at least 5 years full-time equivalent, then you may choose either the supplemental annuity or a re-determined annuity.
What does a "time-limited appointment" mean?
An employee on an appointment with a time limit works only until a specified date and then employment ends. The employing agency sets the ending date when it hires the individual and/or when it extends the appointment. For example, temporary and term employees serve with a time limit, so they are not eligible for an incentive payment or early-out retirement. Career and career-conditional employees and permanent employees in the excepted service have no time limit so they may be eligible.
What does “continuous service” mean?
To be eligible for early retirement, you must have been employed by the Department of the Interior 30 days prior to the request for the VERA, with no breaks of service. Leave without pay (LWOP), permanent seasonal employment (PSE) off-tour time, and other non-pay status during an appointment are NOT considered breaks in service.
What is the difference between a VERA and discontinued service retirement (DSR)?
VERA is a voluntary separation. DSR is an involuntary separation. The differences between VERA and DSR benefits may seem subtle, but might be very important to you. It depends on what your personal plans and needs are. If there is a possibility that you will return to work for any Federal agency, you should seek more detailed information from the Office of Human Resources before you accept a VERA or VSIP offer.
Generally, if your unique position is being abolished, or you refuse a directed reassignment to a position outside of your commuting area, or to a position that is more than two grade intervals below your current grade, or receive a letter of separation from the agency in a reduction in force (RIF), you would be eligible for an immediate annuity retirement under DSR rules if you meet the age and length of service requirements.
The age and service requirements for DSR are the same as those for VERA. The key differences come into play when/if you return to work for the Federal government; for example, as a VERA retiree, you would be a reemployed annuitant and the amount of your pay would be offset by the amount of your annuity. If you were covered under CSRS and you separated under a DSR, you would not be considered a reemployed annuitant because your annuity would stop, so there would be no offset to pay. This does not apply to those covered under FERS.
Annuity
Will my annuity be reduced if I am less than 55 years old?
FERS Employees — Your annuity is not reduced if you are under the age of 55. If you are a FERS employee with a frozen CSRS component, then a portion of your annuity is based on a benefit that you accrued under CSRS. Therefore, that portion of your annuity is subject to the reduction mentioned for CSRS/CSRS Offset employees.
CSRS/CSRS Offset Employees — Your annuity will be reduced at the rate of 2 percent for each year (or by one-sixth of one percent for each full month) that you are under age 55. This is a permanent reduction.
How do I know if I have enough time in service to meet the requirements to retire?
Although you can check your retirement service computation date (SCD) on your SF-50 (Notification of Personnel Action), you should still check with your Benefits Specialist before you make a decision about accepting a VERA. Your benefits specialist can provide you with a retirement calculation and verify that your retirement SCD is correct. Different types of appointments, types of federal service, or if you owe a deposit/redeposit can make a difference in your SCD. The rules are complicated and different depending on the retirement system you are covered under.
How is my annuity determined?
FERS Annuity: — FERS Basic Annuity is computed by multiplying 1 percent of your high-3 average by your years and months of creditable service. FERS employees separating between now and December 31, 2013, will receive service credit for 50 percent of their unused sick leave. Those retiring after January 1, 2014, will receive full service credit for their unused sick leave. If you retire under the age of 55, there is no annuity reduction. The commencing date of your annuity is the first day of the month following retirement.
CSRS Annuity — The general formula for computing a CSRS annuity is as follows:
- 1.5 percent of your high-3 average salary multiplied by service up to 5 years,
- plus 1.75 percent of your high-3 average salary multiplied by service between 5 and 10 years,
- plus 2 percent of your high-3 average salary multiplied by service over 10 years.
Unused sick leave can be used for additional service credit. If you are under age 55, this calculation is reduced by one-sixth of one percent for each full month you are under age 55 (that is, 2 percent per year). The commencing date of your annuity is the first day of the month following retirement; if you retire on the 1st, 2nd, or 3rd day of a month, your annuity begins the following day.
EXCEPTION — FERS transferees with a CSRS component will have their annuity consist of a CSRS and a FERS portion. An employee who retires before age 55 will have the CSRS portion of the payable annuity reduced by one-sixth of one percent for each full month he/she is under age 55 (that is, 2 percent per year). No reduction will be applied to the FERS component of the annuity. Employees who were previously under CSRS but who transferred to FERS will receive credit for either the amount of sick leave at the time they transferred to FERS, or at the time of retirement—whichever is less.
If you are under FERS you will be entitled to a FERS Annuity Supplement. This estimates the Social Security benefit earned by your FERS years of service and is payable by OPM to you if you have completed at least one calendar year of FERS service. It is paid until you become eligible for a Social Security benefit at age 62. However, this supplement is payable only if you have reached your minimum retirement age (MRA)—your earliest optional retirement age. MRA increases over time based on an employee’s year of birth and ranges between ages 55 and 57. Your Benefits Specialist can provide further guidance.
Where can I go to get an estimate of my annuity?
You need to contact your servicing Benefits Specialist.
Leave
If I separate under VERA, what will happen to my earned and unused annual leave?
You will be eligible for a lump sum payment for your unused annual leave.
If I separate under VERA, what will happen if I am indebted for advanced annual or sick leave?
If you are indebted for advanced annual or sick leave, you must refund the amount paid for the leave. If you do not refund the amount of the indebtedness, deductions will be made from any funds that you are due upon your separation.
For additional information visit the USGS Pay and Benefits pages.
Visit the ASK HRO page for a listing of Benefits Specialists that are available to help you.
