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Pentagon Plan Would Let Retirees Return Without Sacrificing Pay

By Stephen Barr, Washington Post

 May 5, 2003

Federal retirees with a hankering to go back to work -- but deterred by pay restrictions in the law -- might get their chance at the Defense Department if Congress gives the green light.

A provision in the Pentagon's far-reaching plan to overhaul the Defense civil service workforce would allow retirees who become employed in the department to collect a paycheck and their pension. Currently, civil service retirees who go back to work in the government face a deduction in pay equal to the amount of their annuity.

The law imposing the financial penalty can be waived when agencies need to bring back experienced hands. That happened after the Sept. 11, 2001, terrorist attacks, and Pentagon officials cite that example as a reason to give the department leeway in bringing back retirees who know how to keep programs operating.

Pentagon officials are interested in using retirees, ironically, to help offset a coming retirement wave at Defense.

Many Defense civilians began their careers in the 1960s and 1970s and are starting to think about leaving. Their departure likely will leave the department short of staff with the right skills and experience because hiring freezes and the post-Cold War downsizing thinned civilian ranks.

Officials also point out that Congress repealed laws three years ago that forced thousands of military retirees to give up all or large portions of their retirement pay if they took civil service jobs. "We're trying to create for civil servants an even playing field," David S.C. Chu, the Defense undersecretary for personnel and readiness, told reporters recently.

At a House Armed Services Committee hearing last week, Chu said relaxing retirement restrictions would allow the department to use seasoned employees to train younger workers and pass on institutional knowledge. Currently, many seasoned employees retire because they see opportunities to work in the private sector, he said.

Without some flexibility, Chu said, "what happens is the contractor takes them."

Washington Post staff writer Christopher Lee, who covered the hearing, reported that House Armed Services Chairman Duncan Hunter (R-Calif.) seemed taken by the idea.

"A lot of them, I think, would relish the mentor role," Hunter said. "I've had retirees express to me quite bitterly their resentment that they can't come back and help. . . . They're driven to a third party. . . . We're going to lose out to that private company."

But the proposal, which critics often deride as "double dipping," could cause problems in the rest of the civil service. One official warned such an exemption would encourage talented workers at non-defense agencies to migrate to Defense as they approached retirement age.

Bobby L. Harnage Sr., president of the American Federation of Government Employees, said Congress should be careful not to create incentives that let people retire and then come back to the same position, increasing their income substantially while doing the same job.

David M. Walker, the head of the General Accounting Office, said the policy could be limited to people in critical occupations who could be hired back only for temporary, and well-defined, periods. Otherwise, costs could rise substantially, he said.

Payday for Special Raters

A settlement administrator has started mailing information to more than 200,000 people who are covered by a court agreement that will provide them with more than $178 million in back pay, a spokeswoman for the National Treasury Employees Union said.

From 1982 to 1988, special-rate employees did not receive or received only partial pay raises to which they were entitled.

NTEU challenged a Reagan administration rule in court and prevailed.

Last month, the government turned over the funds for the back pay awards to the settlement administrator.

For information on the payments, call the special-rate hotline at 1-800-750-3406, the union spokeswoman said.


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