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Congress debates sick-leave worth
Question of the Day
Sick leave. Is it a safety net — like fire or auto insurance — to be used only when needed? Or is it an earned benefit or multipurpose entitlement?
The issue is part of the debate as Congress moves to improve the perk for two out of three federal employees. The idea is to give financial incentive for those who use leave judiciously and save taxpayers millions of dollars a year.
Here is the situation:
Federal and postal workers have one of the best sick-leave benefits in the nation. They earn 13 days per year and are not limited in the amount of time they can accumulate.
Whether retiring feds will be rewarded with fatter annuities or “lose” as much as two or three years’ worth of sick leave at the end of their careers depends on their pension plan.
Workers under the older Civil Service Retirement System — mostly people hired before the mid-1980s — are rewarded for staying healthy. Once they are otherwise eligible to retire, they can tack on unused sick leave to boost their lifetime retirement benefit.
An employee with 2,080 hours of unused sick leave, which is not unusual, gets credit for an extra year of service. That means a bigger annuity, which is fully indexed to inflation.
Most people on the federal payroll today are under the Federal Employees Retirement System, which replaced the CSRS. FERS employees get a smaller civil service retirement annuity, more limited cost-of-living adjustments, Social Security coverage and a more generous 401(k) plan.
What they don’t get is any credit for returning their sick leave to the government when they retire.
Consequently, many people suspect that some workers develop a case of the “FERS flu” before retirement; that is, they take time off when they aren’t sick. In doing that, they bank annual (vacation) leave for which they do get paid when they retire.
Rep. James P. Moran, Virginia Democrat, said the government could save money and do the right thing by FERS employees if it provides an incentive to save sick leave.
His idea is simple: FERS employees with 500 or more hours of unused sick leave would get a prorated, one-time payment for that leave at retirement. The maximum payment would be $10,000, but in practice most would get less.
Did feds cheer when Mr. Moran introduced his bill last week? Hardly.
In fact, many leveled sharp criticism at his something-is-better-than-nothing plan. Here are reactions from a couple of readers:
”Maybe I’m missing something, but based on my current understanding, the Moran bill to encourage FERS employees to use sick leave more judiciously doesn’t seem like much incentive. If I could accumulate 1,250 hours of sick leave before I retired, I’d get less than 10 percent of my per-hour salary for it at retirement. Are there really that many employees who would come to work for just a few bucks an hour? I’m pretty sure I’d prefer taking sick leave … which isn’t to say that I necessarily would. The point is that the financial remuneration is so minimal that it would have no effect on my decision.” D.S.
By Robert N. Tracci
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