Many employees who are receiving reduction in force (RIF) notices face the question of whether they should consider applying for retirement—and what effects such a retirement could have on their RIF appeal.
Federal employees under the Federal Employee Retirement System (FERS) who have either (a) 25 or more years of creditable civilian service, or (b) 20 or more years of creditable civilian service and are over age 50, are eligible to retire under FERS Early Retirement (sometimes colloquially referred to as FERS “DSR” or “Discontinued Service Retirement,” referencing an analogous concept originally deriving from the older Civil Service Retirement System (CSRS)), if they are involuntarily separated for a qualifying nonpejorative reason. A RIF separation is qualifying for a DSR. However, care must be taken to ensure that the separation is in fact due to a RIF. A properly-conducted RIF that occurs in compliance with relevant federal regulations (as opposed to other actions such as a potentially unlawful constructive RIF) includes issuance of a RIF notice to the employee which must meet specific content requirements. Agencies have been found at times to issue misleading correspondence that threatens that an employee may be separated without meeting the legal requirements of a RIF notice. See, e.g., Wylie v. Dept. of Agriculture, 99 M.S.P.R. 71 (2005) (employee issued position abolition notice that did not meet RIF requirements, and which did not meet OPM requirements that position abolition notice that employee is not being pressured to apply for DSR).
When an employee receives a legally-compliant RIF notice, a question arises as to the timing of when the employee should apply for DSR, if they so choose. There is no formal deadline for applying for DSR, and more particularly no legal requirement that the employee must apply for DSR prior to the effective date of separation under the RIF notice (as opposed to filing for DSR after the effective date of the RIF separation)—provided that the employee has first received a RIF notice definitely stating the agency’s final decision to separate the employee from federal service. Thanks to a 1990 statutory amendment, the fact that an employee accepts retirement after receiving a definite notice that they will be removed under a RIF does not preclude them also appealing the RIF to the MSPB. See 5 U.S.C. § 7701(j); Mays v. Department of Transportation, 27 F. 3d 1577 (Fed.Cir. 1994); Mullen et al. v. Dept. of the Navy, 76 M.S.P.R. 590 (1997); Pugh v. Defense Commissary Agency, 65 M.S.P.R. 6 (1994). This rule applies even to Foreign Service Officers’ RIF appeals, if taken to the MSPB. See Delaney v. U.S. Agency for International Development, 80 M.S.P.R. 146 (1998). However, 5 U.S.C. § 7701(j) applies to retirements, not resignations. Also, this analysis applies where the retirement is a discontinued service retirement associated with an involuntary separation, and does not apply where for example an employee opts to separate under Voluntary Early Retirement Authority (VERA) and apply for non-DSR FERS early retirement, even after receipt of a RIF notice stating the employee would be separated, if participating in VERA results in cancellation of the RIF separation. See Gustavson v. Dept. of the Army, 79 M.S.P.R. 638 (1998). Also, if the employee files instead for disability retirement, the disability retirement is granted, and the RIF is substituted for a disability retirement, the employee may no longer have the ability to appeal the RIF. See Shelton v. U.S. Soldiers’ and Airmans’ Home, 82 M.S.P.R. 695 (1999).
If you are a federal employee who has received a RIF notice and wish to discuss your rights, consider contacting Gilbert Employment Law to request an initial consultation.