If the Postal Service as expected is given funding to offer early retirement incentives for postal employees, the respective unions and management associations will want to ensure that ensure that the process is as fair and generous as possible. There are some obvious concerns that the leadership should consider.
When should the the separation date be?
- Eric Zurndorfer has written an article in My Federal Retirement that lays out the criteria for picking an optimal separation date. Basically he concludes the following:
- Separation dates ideally should be the last day of a pay period. – This maximizes the lump sum annual leave payment.
- CSRS must retire by the 3rd day of the month or the first pension payment is delayed a month. ThereforeThe best separation dates for CSRS employees are the first three days of the month. This makes the first pension payment due the first of the next month.
- FERS employees need to retire by the end of the month. Annuity payments begin the 1st day of the month after retierment is effective. If a FERS their retirement is effective on the first day of the next month, and they receive their first annuity payment one month later. Retiring early in the month can result in a 60 day delay between the final day of work and the first annuity payment.
- To the extent that the Postal Service wants a single separation date, unions and management associations should negotiate to ensure that separation dates are on the last day of a pay period of any month.
Should early retirement incentives be offered nationwide or on a local or national basis?
- All unions and management associations should prefer to have the offer apply nationwide. However, the changes that the Postal Service is contemplating in both union and non-union jobs may not all occur at once.Unions have real interest to minimize the number of employees that do not have jobs when individual plants, Post Offices, and regional offices close and deliver routes in a region are consolidated. Incentives both smooth the process for employees and free up jobs for employees that want to continue to work. Regional and/or local incentives should also reduce bad press about Postal Employees being paid without while sitting in ready rooms.
Good arguments exist on all sides of this issue. My inclination is somewhat of a compromise which allows the Postal Service to offer incentives on a local and or basis with the standard rules applied nationally on how and where local and regional retirement offers should be offered.
