FERS Sick Leave Fix On the Way

By U.S. Rep. James Moran
February 10, 2009

On Tuesday, I joined with Congressman Frank Wolf to introduce the “FERS Sick Leave Equity Act.” This legislation would provide federal employees under the FERS retirement system a sick leave benefit equal to that of employees under the old CSRS retirement system. The CSRS “sick leave benefit” currently allows federal employees to add any unused sick leave to the number of years they have worked for the purposes of determining their annuity at retirement. 
 
FERS current ‘use-it or lose-it’ system for sick leave hampers productivity and increases training costs. Since sick leave for FERS employees has no value at retirement, problems have arisen with some employees calling in sick for weeks, even months at the end of their careers using up their accrued sick leave in one lump sum. OPM estimates that this flawed policy is costing taxpayers $68 million per year in lost productivity. Our legislation seeks to reverse that trend, incentivizing the accrual of sick leave.

A little background for those unfamiliar with this issue: The FERS retirement system, created by Congress in 1986, does not include a sick leave benefit.  However, federal employees under the old CSRS retirement system (those who joined the civil service prior to 1986) are currently able to convert unused sick leave at retirement into an increase in their annual annuity.

This arrangement has not always been in place.  In 1969, Congress added a sick leave benefit for CSRS employees after data showed that the use of sick leave went up dramatically nearing the time of retirement.  The Civil Service Commission – the forerunner to OPM – estimated that half of all retiring federal employees had ZERO sick leave; their reports showed that retiring employees prior to 1969 used an average of 40 sick leave days in their last year of employment.

These are lessons Congress should have learned when implementing the FERS system. Unfortunately, they were ignored and history is repeating itself. A Congressional Research Service report from August 2007, found that sick leave balances are lower for FERS employees than CSRS employees.  Independent studies by the Bureau of Prisons have reached the same conclusion with OPM confirming it in their own analysis.

Also, in a recent survey of FERS and CSRS employees, 85% of CSRS employees said they conserved as much sick leave as possible.  On the other hand, 75% of FERS employees said they would use as much sick leave as possible during their last years.

The inequality is clear, the solution simple. Our federal workforce is the best in the world; they deserve a benefit designed to reward, not punish, the majority who play by the rules. I plan to pursue this legislation aggressively in the coming months and am optimistic we can make real progress in the first year of the 111th Congress.