FOR IMMEDIATE RELEASE
July 31, 2008
July 31, 2008
Michael Victorian
(202) 639-6419
(202) 639-6419
AFGE Lauds Reps. Henry Waxman and Jim Moran for Legislation Improving Federal Retirement Benefits
(WASHINGTON) – The American Federation of Government Employees (AFGE), today lauded the extraordinary leadership of House Oversight and Government Reform Committee Chairman Henry Waxman (D-CA) and Representative Jim Moran (D-VA) for their legislation to make significant improvements in federal retirement benefits.
“We applaud the outstanding leadership of Representatives Henry Waxman and Jim Moran. The improvements in federal retirement benefits provided in this legislation will go a long way toward honoring federal employees who have made public service a career.”
Attached to H.R.1108, the Family Smoking Prevention and Tobacco Control Act, the legislation ensures that employees covered under the Federal Employees Retirement System (FERS) will receive the same credit for their unused sick leave toward retirement as employees in the Civil Service Retirement System (CSRS). The bill also provides for automatic enrollment of new federal employees in the Thrift Savings Plan (TSP), and establishes a Roth-style option for employees participating in the TSP.
Sick Leave Credit toward Retirement for FERS Employees
An idea long advocated by Representative Jim Moran (D-VA), this bill would equalize the treatment of unused sick leave in the Civil Service Retirement System (CSRS) and the Federal Employees Retirement System (FERS). After three years, FERS employees would join their CSRS coworkers in having all of their unused sick leave credited to the length of service that is used for calculating their retirement annuity. This change would apply to both regular and survivor annuities under FERS. During the first three years, FERS employees would receive credit for 75% of their sick leave.
The inequity between the two retirement systems has been a serious concern for both workers and managers, in that it gave FERS employees no incentive to conserve sick leave, and no financial recognition for a career with exemplary attendance.
Automatic Enrollment
Currently, new federal employees have to choose to participate in the TSP. If they do so, they receive significant government agency matches to their own contributions. However, many new federal employees find the explanations about the TSP during their orientations to be confusing, and decide not to enroll, inadvertently losing out on the agency matches to their contributions. The change provided by H.R. 1108 would automatically enroll employees in the TSP, but give them the option to decline enrollment. This change from an opt-in approach to the TSP to an opt-out approach will go a long way toward enhancing the economic circumstances of federal employees.
Roth Plan in TSP
AFGE also supports the addition of a Roth-style option in the TSP for employees. Although a Roth-style plan is not in the economic interests of all federal employees, it is an additional option which will benefit those who expect to have higher income taxes in their retirement years than when they were working.
“We applaud the outstanding leadership of Representatives Henry Waxman and Jim Moran. The improvements in federal retirement benefits provided in this legislation will go a long way toward honoring federal employees who have made public service a career.”
Attached to H.R.1108, the Family Smoking Prevention and Tobacco Control Act, the legislation ensures that employees covered under the Federal Employees Retirement System (FERS) will receive the same credit for their unused sick leave toward retirement as employees in the Civil Service Retirement System (CSRS). The bill also provides for automatic enrollment of new federal employees in the Thrift Savings Plan (TSP), and establishes a Roth-style option for employees participating in the TSP.
Sick Leave Credit toward Retirement for FERS Employees
An idea long advocated by Representative Jim Moran (D-VA), this bill would equalize the treatment of unused sick leave in the Civil Service Retirement System (CSRS) and the Federal Employees Retirement System (FERS). After three years, FERS employees would join their CSRS coworkers in having all of their unused sick leave credited to the length of service that is used for calculating their retirement annuity. This change would apply to both regular and survivor annuities under FERS. During the first three years, FERS employees would receive credit for 75% of their sick leave.
The inequity between the two retirement systems has been a serious concern for both workers and managers, in that it gave FERS employees no incentive to conserve sick leave, and no financial recognition for a career with exemplary attendance.
Automatic Enrollment
Currently, new federal employees have to choose to participate in the TSP. If they do so, they receive significant government agency matches to their own contributions. However, many new federal employees find the explanations about the TSP during their orientations to be confusing, and decide not to enroll, inadvertently losing out on the agency matches to their contributions. The change provided by H.R. 1108 would automatically enroll employees in the TSP, but give them the option to decline enrollment. This change from an opt-in approach to the TSP to an opt-out approach will go a long way toward enhancing the economic circumstances of federal employees.
Roth Plan in TSP
AFGE also supports the addition of a Roth-style option in the TSP for employees. Although a Roth-style plan is not in the economic interests of all federal employees, it is an additional option which will benefit those who expect to have higher income taxes in their retirement years than when they were working.
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