Legal Insider: Are You in the Wrong Federal Retirement System?

This is a sponsored column by attorneys John Berry and Kimberly Berry of Berry & Berry, PLLC, an employment and labor law firm located in Northern Virginia that specializes in federal employee, security clearance, retirement and private sector employee matters.

By John V. Berry, Esq.

The Federal Erroneous Retirement Coverage Corrections Act (FERCCA) was enacted in September, 2000 and designed to provide relief to federal civilian employees who were placed in the wrong federal retirement system for at least three years of service after December 31, 1986.

Typically, FERCCA errors arise when a federal employee experiences a break in service, especially during the mid-1980s when the Federal Employees Retirement Systems (FERS) plan was created. In some cases, FERCCA has provided federal employees and annuitants placed in the wrong federal retirement system with the opportunity to choose between FERS and the offset provisions contained within the Civil Service Retirement System (CSRS).

In order to determine if you are in the correct federal retirement plan, you need to know the type of appointment you have and your work history. Federal retirement rules governing retirement plan placement are complex and contain many exceptions that are hard to follow. If you find that you fit in any of the situations described below, you could be in the wrong federal retirement system. However, keep in mind that there are exceptions to the general rules.

If you currently have CSRS coverage, then you may be in the wrong plan if:

• You worked for the federal government before 1984, but not on a permanent basis
• You left federal employment for more than a year at any time after 1983
• You have a temporary appointment limited to a year or less, a term appointment, or an emergency indefinite appointment
• You have no federal civilian employment before 1984
• You do not have a career or career conditional appointment and you work on an intermittent basis (see the work schedule block on your SF-50)

If you currently have CSRS Offset coverage, then you may be in the wrong plan if:

• You have a temporary appointment limited to a year or less, a term appointment, or an emergency indefinite appointment
• You have no federal civilian employment before 1984
• You do not have a career or career conditional appointment and you work on an intermittent basis (see the work schedule block on your SF-50)
• You did not work for the federal government for a total of five years before 1987 (not including your military service). Exception: If you worked under CSRS, left the federal government, and your agency placed you in CSRS Offset upon your return, your CSRS Offset coverage is probably correct if you had five years of federal government service when you left.

If you currently have FERS coverage, then you may be in the wrong plan if:

• You have a temporary appointment limited to a year or less
• You do not have a career or career conditional appointment and you work on an intermittent basis
• You have worked for the federal government for at least five years before 1987 (not including military service) unless you elected to transfer to FERS during a FERS Open Season or after a break in service

FERCCA can also provide 1) reimbursement for certain out-of-pocket expenses paid as a result of a coverage error (e.g., attorney’s fees, costs, etc.); 2) an ability to benefit from certain changes in the rules about how some federal service is credited toward retirement; and 3) make-up contributions to the federal employee’s Thrift Savings Plan (TSP) and receipt of lost earnings on those contributions, among other provisions.

If you think that you have a FERCCA error, you should notify your agency’s Human Resources department. Pursuant to FERCCA regulations, the federal government — upon its receipt of notice that a potential FERCCA error exists — should review your work history to confirm whether a FERCCA error actually exists and supply you with correspondence confirming the FERCCA error and other pertinent information, including benefit estimates for individuals entitled to an election option.

You should also receive a federal election form and information regarding how to receive reimbursement for your actual out-of-pocket expenses related to your FERCCA error, including attorneys’ fees. For more information, visit the Office of Personnel Management’s web site for frequently asked questions concerning FERCCA.

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