Bill to rehire retirees gets qualified support

A House bill designed to make it easier for agencies to rehire federal retirees has received broad but qualified support in a hearing of the House Oversight and Government Reform Committee's Workforce Subcommittee.

The bill is sponsored by Rep. Tom Davis (R-Va.), ranking member of the subcommittee, and would let agencies rehire retired federal employees on a temporary basis without a loss of their annuities. Under current law, the salary of rehired retirees must be offset by the amount of the annuity, although it also permits the Office of Personnel Management to waive the offset rule under some circumstances.

Susan Gilman, legislative director at the National Treasury Employees Union, testified at the May 20 subcommittee session that NTEU doesn’t oppose the judicious re-employment of federal retirees. However, she said, union officials are concerned that passage of the measure could open the door to potential abuse.

For example, because rehired retirees would not be eligible for most benefits that other employees receive, she said, they would have budgetary advantage over other federal employees, giving agencies an incentive to maximize the use of returning retirees rather than hiring and promoting full-time, permanent employees.

Agencies, Gilman said, should focus more on workforce planning and recruiting and retaining talented employees to meet current and future personnel needs — and not rely on rehired annuitants for tasks such as training and mentoring.

“Opportunities to provide training and mentoring are often the most valuable experience available to [current] employees to prepare them for more challenging work and promotions to positions of increased responsibility,” she said.

“We do train people, but unexpected things occur,” said Nancy Kichak, associate director of strategic human resources policy at OPM. “People leave before you expect them to but still are unable to retire. Folks get sick, and folks decide to change jobs.”

Daniel Adcock, assistant legislative director at the National Active and Retired Federal Employees Association, which supports the bill, said agencies should “use this authority to supplement, and not supplant, the current workforce and to find annuitants with specific skills…not presently available for hard-to-fill positions that require specific skills.”

To avoid potential abuse, Patrick Purcell, a specialist in income security at the Congressional Research Service, suggested that the proposed changes be limited to a demonstration period of five or 10 years, and then officials can “evaluate how agencies and individuals respond.”

Del. Eleanor Holmes Norton (D-D.C.), noted that the Defense Department has had the authority to rehire retirees without annuity loss for several years, and she suggested that a study of the DOD experience would help lawmakers weigh the impact of similar rules for civilian agencies.

“It seems to me you have the perfect laboratory right there,” she said.


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