What is a Voluntary Early Retirement Authority?
A Voluntary Early Retirement Authority (VERA), also referred to as an early-out, is an opportunity to retire in advance of meeting the age and/or service requirement normally needed for retirement. As reflected in its official title, a decision to apply for a VERA is voluntary.
What authority does the Department of Commerce have to offer VERAs?
Under the Homeland Security Act (P.L. 107-296), the Office of Personnel Management (OPM) can grant VERA authority to an agency to enable it to complete its personnel or workload changes with a minimal disruption to its workforce. The agency determines which offices, locations, positions, or skills are no longer needed due to budget shortfalls or organizational changes (reorganizations, realignments, transfer of functions, new technology, reshaping, restructuring, etc). Based on an agency’s request, OPM gives the agency the authority to offer VERAs to employees affected by management’s decision.
Who is eligible for a VERA?
All employees who work in positions covered under the agency VERA offer and who meet the general requirements are eligible to apply.
Eligible employees must:
- Be on Commerce’s rolls at least 31 days prior to the date the bureau requests VERA authority, without a break in service of 4 or more days.
- Must separate from a position subject to Civil Service Retirement System (CSRS) or Federal Employees’ Retirement System (FERS) coverage. If retiring under CSRS, employees must have been covered under CSRS for one year out of the last two years.
- Must be at least age 50 with 20 years of creditable service or any age with 25 years of creditable service when separated. At least 5 years must be creditable civilian service.
- Must separate by the last day of the VERA window.
If any of the following applies, an employee is ineligible for a VERA:
- Serving on a time-limited appointment, e.g., temporary or term.
- In receipt of a decision of involuntary separation for misconduct or unsatisfactory performance.
How will annuity computations be affected by VERA?
Employees who are covered by CSRS will face a 2 percent reduction in annuity per year that they are under the age of 55. Although this reduction does not apply to employees who retire under FERS with straight FERS creditable service, it does apply to employees who transferred to FERS with at least 5 years of creditable CSRS (not CSRS Offset) service. The reduction, however, will only apply to the CSRS portion of the annuity.
What happens to employees’ unused sick leave?
CSRS employees who meet the eligibility requirements to retire early will then have full months of unused sick leave added to their annuity. FERS employees who are separating with title to an immediate annuity or who die leaving a survivor eligible for a survivor annuity will be entitled to credit for 50 percent of their unused sick leave. Sick leave will be used in the computations in the same manner it is used in CSRS computations. (NOTE: Effective for separations and deaths occurring on or after January 1, 2014, 100 percent of the unused sick leave will be available.)
How are VERAs and VSIPs related?
VERAs and VSIPs are two different types of incentives that can be used to offset the impact of involuntary separations. A VERA allows an employee to opt to retire before meeting the normal age and years of service requirements. A VSIP is a lump-sum payment made to eligible employees who voluntarily separate through resignation, optional retirement, or early retirement. Depending on individual circumstances, some employees may be eligible for, and receive, either or both incentives.