As a result of the repeated attacks on federal employees from Capitol Hill, a number of members have contacted us and asked what options the agency might have to reduce the size of the federal workforce. To be clear, we have no information that anyone is planning any of these reductions, but we are posting this information because of the inquiries we received.
In the past, the agency typically avails itself of a number of options before resorting to involuntary reductions in force or RIFs. Typically those options include:
Before you dismiss the impact of normal attrition, keep in mind that 38 percent of federal employees are retirement eligible in 2017. According to the GAO, "By September 2017, nearly 600,000 (31 percent) of on board staff will be eligible to retire." The report continues, "by 2017, 20 of the 24 CFO Act agencies will have a higher percentage of staff eligible to retire than the current overall average of 31 percent." EPA is a CFO-Act agency. Our retirement-eligibility rate is about 38%!
The annual federal retirement rate typically averages about 3.5 percent. With changes in administration, however, that rate typically increases.
After attrition, the federal government typically resorts to VERAs and VSIPs. Recently, FEDweek published a good, short discussion of the differences between VERAs and VSIPs. They note that "VERAs allow employees with the right combination of age and service to retire early: at age 50 with 20 years of service or at any age with 25 years of service."
Most current employees in federal service will be retiring under the Federal Employee Retirement System (FERS), and the article notes that "under FERS, the usual 5 percent per-year penalty for retiring before age 62 (60 if you have 20 years of service) will be waived." The article notes that VERA retirees get "a special retirement supplement (SRS) that approximates the Social Security benefit" the retiree earned while an employee, but that the SRS won’t begin until the retiree reaches the "minimum retirement age (MRA)." Finally, the article notes that the "annuity won’t be increased by COLAs until you reach age 62." COLAs are never paid on the SRS, however.
A VSIP, the article notes, is a buyout and "can be offered to any employee, not just someone who meets the age and service requirements for a VERA." But to be eligible for a buyout, the article notes, "an employee’s position must be specifically flagged for elimination in the agency’s strategic plan."
"The amount of the buyout must be equal to the lesser of the employee’s severance pay calculation or a dollar amount—for older/longer term/higher paid employees, the severance entitlement almost certainly would work out to more than the threshold. That amount typically is $25,000...."
Here's the OPM page on VERAs.
Here's the OPM page on VSIPs.
In the coming months, we'll share information on RIFs as well. Please keep in mind that RIFs are extremely rare and have never been carried out at EPA. In 1990, the agency issued notices of a proposed RIF, but never actually RIFed anyone, as far as we know.