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Sick Leave Counts in FERS Benefit Calculation

This provision would require that Federal Employee Retirement System (FERS) include workers’ unused sick leave in the calculation of their monthly benefit payments. Currently only workers covered by the old Civil Service Retirement System may count unused sick leave toward their pensions. The provision phases in the change so that workers retiring within three years of the provision’s enactment will receive credit for 75 percent of their unused sick leave, and workers retiring after three years will receive full credit for their unused sick leave.

The FERS pension benefit is calculated using a formula that takes a worker’s average pay and multiplies it by a percentage and then multiplies it by the worker’s years of service. Workers can carry over all their sick leave from year to year, and they may amass a large amount of sick leave that could markedly improve their pension benefits.

Read Section 407 of H.R. 1984.

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