Learn more about phased retirement benefits
FAQs and answers about the phased federal retirement program.
Questions and answers
Phased retirement allows active federal employees to "retire" from part of their job responsibilities, while continuing to execute other job functions such as mentoring and knowledge-transfer to employees moving into senior positions. While in phased retirement status, the part-time employment status still allows the employee to earn full federal retirement benefits as if they were still working full time. Phased retirement is voluntary and is not an entitlement. It also requires mutual agreement between employee and agency.
Employees in a phased retirement status continue to work on a part-time basis and draw partial retirement benefits during their continued employment. Phased retirees must commit 20 percent of their new part-time work schedule to mentoring activities as outlined in the phased retirement guidelines.
OPM published final regulations to implement phased retirement on August 8, 2014. Federal agencies began using phased retirement on November 6, 2014.
Phased retirement is designed to encourage the most experienced federal employees to extend their public service before they fully retire. It's intended to encourage experienced employees to keep working, in at least a part-time capacity, until less experienced employees are fully equipped to fulfill the same duties and responsibilities as those employees in senior level positions who are ready to retire.
A primary goal of phased retirement is to enhance mentoring and training of the next generation of federal employees who will be moving into senior-level positions. It's a tool to ensure continuity of operations and to facilitate knowledge management and transfer across the federal government. Most Federal agencies use phased retirement as a succession planning tool. Agencies utilize the program as a way to keep in-house knowledge practiced during transitional periods.
When an employee elects and participates in the phased retirement program, their annuity will be calculated as if they fully retired and then it will be divided by 2. The employee will receive 50 percent of their annuity while also receiving 50 percent of their regular pay, since they are continuing to work part time.
When an employee fully retires, OPM will re-calculate their annuity based on a salary as if they were working full time. In general, this final amount will be more than if the employee fully retired and did not keep working part time. This final annuity amount will be the basis for any other federal retirement benefits, like for survivors or those with a disability.
Participation is entirely voluntary, and requires the mutual consent of both the employee and the employing agency. In order to participate, an employee must have been employed on a full-time basis for the previous 3 years. Under CSRS, the employee must be eligible for immediate retirement with at least 30 years of service at age 55, or with 20 years of service at age 60. Under FERS, the employee must be eligible for immediate retirement with at least 30 years of service at MRA (minimum retirement age 55-57 depending upon year of birth), or with 20 years of service at age 60.
Disability candidates, FERS employees retiring under MRA+10 provisions, reemployed annuitants, and individuals who have already served a period of phased retirement and returned to full-time duty (opted out) are all excluded from participation in the phased retirement program. Law enforcement officers, fire fighters, air traffic controllers, nuclear materials couriers, Capitol police, Supreme Court police, and some Customs and Border Protection (CBP) officers are subject to mandatory retirement provisions and may also be excluded. Individuals working special work schedules that don't allow a recurring part-time schedule are also excluded, including fire fighters covered by 5 USC 5545b and nurses working under 38 USC 7456 or 7456A.
A phased retirement period is the period beginning on the date the employee begins work on a half-time basis as a phased retiree and ending on the date that the individual separates from phased retirement into full retirement status.
To opt out of phased retirement, the employee and approving agency official must complete part 2A of the SF-3116 and send a copy to OPM's point of contact email address: email@example.com. Once a phased retiree opts out of the program, they aren't allowed to take part in phased retirement again.
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