With on-going discussion of anticipated government downsizing, you may be considering your options and those options may include retirement and voluntary “VERA/VSIP” buyouts. You may also wonder what happens if there is a reduction in force, or “RIF”.
Agencies seeking to reduce their workforce may offer some employees incentives, called VERA or VSIP, to voluntarily leave the government so the agency can minimize or avoid involuntary separations through RIFs – reductions in force. Executive branch agencies can seek approval from OPM to offer VERA/VSIP in an effort to reduce the federal workforce in the event of agency restructuring or government downsizing. Some agencies, such as the Department of Defense have been granted agency-specific VERA authority and do not have to obtain OPM approval to use this option.
Under Voluntary Early Retirement Authority – VERA - an employee may retire early if they meet the general eligibility requirements. The employee must:
- Meet the minimum age and service requirements -
- At least age 50 with at least 20 years creditable federal service, OR
- Any age with at least 25 years creditable federal service;
- Have served in a position covered by the OPM authorization for the minimum time specified by OPM (usually 30 days prior to the date of the agency request);
- Serve in a position covered by the agency's VERA plan; and
- Separate by the close of the early-out period.
Before accepting a VERA offer, you should ask your agency’s personnel or retirement office for an estimate of your retirement benefits so you know what to expect. Ask for estimates under VERA and also under regular retirement, so you can make an informed decision.
VSIP is a buy-out plan where agencies are allowed to give employees up to $25,000 as an incentive to voluntarily separate, either by retirement or resignation. This figure may go up soon. To be eligible, the employee must be in a designated surplus position or have skills no longer needed. The employee must:
- Be serving in an appointment without time limit;
- Be continuously employed by the Executive Branch for at least 3 years;
- Be serving in a position covered by an agency VSIP plan (i.e., in the specific geographic area, organization, series and grade);
- Apply for and receive approval for a VSIP from the agency making the VSIP offer; and
- Not be covered by the seven categories of ineligibilities. (You can find these on the OPM VSIP page)
There are some additional specific provisions applicable to VERA and VSIP for DoD employees (you can find more in the DoD guidance).