Fork in the Road: U.S. Government Buy Out Letter Example

As you consider whether to accept the “Fork in the Road” offer of a deferred resignation, we remind you of thoughts we have previously expressed about this scheme.  In addition, for comparison purposes, we wanted to share with you a sanitized example of a traditional buyout letter that a Federal worker would receive under a normal, statutorily-authorized buyout program. Again, the ‘Fork in the Road' deferred resignation offer is not a statutorily authorized official government program, and it relies on a process that requires federal workers to simply reply to an email generated from an unknown server with unknown security protections in place. We believe that the Administration has failed to provide adequate information to Federal workers about how this scheme complies with law and how it will be funded after the expiration of the continuing resolution that currently funds the government through March 14, 2025. 

We will be updating our Q and A regularly, so if you have additional questions, send them to info@civilservicestrong.org. 

U.S. Government Buy Out Letter Example

TO: Agency Administrators State Directors

ATTN: All [Agency] Employees

FROM: [Under Secretary Name] Under Secretary

SUBJECT: Notice of Voluntary Early Retirement Authority and Voluntary Separation Incentive Payment Authority

As the [Secretary/Administrator] has indicated, the fiscal situation for Fiscal Year (FY) [YEAR] and beyond has necessitated a serious reexamination of priorities. This has resulted in the determination that many agencies will operate as restructured and leaner organizations. In order to address the upcoming FY [YEAR] budget reductions, the agency will use a variety of tools to minimize the impact on our employees and ensure equitable treatment among those involved.

[Agency Name] has received approval to offer up to [NUMBER] Voluntary Separation Incentive Payments (VSIPs) also known as "Buyouts". The Buyouts can be used in conjunction with an Optional Retirement or with a Voluntary Early Retirement Authority (VERA) also known as an "Early Out". The initial offer for the VSIP will be $25,000, however; it is expected to be set at a lesser amount for any subsequent opening periods. [Agency]'s VSIP is offered to all optional retirement and early retirement eligible employees. The [Agency] VERA is offered to all early retirement eligible employees. [List any exempt positions] are exempt from the VERA and VSIP. These positions are critical to the mission of the Agency and are deemed hard to fill.

Your decision to separate by retirement is voluntary. This is an important decision and you are encouraged to seek information from your servicing Human Resources Manager for assistance in making an informed choice.

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EXPIRATION DATE: [DATE]

FILING INSTRUCTIONS:

Administrative Other Programs

[Agency Address]

Web: [Agency Website]

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Committed to [Agency Mission Statement]

"[Agency] is an equal opportunity provider, employer and lender."

To file a complaint of discrimination write [Agency], Director, Office of Civil Rights, [Address] or call [Phone Numbers].

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Voluntary Early Retirement Authority (Early Out)

This authority expands the normal retirement eligibility to now allow employees to voluntarily retire, at age 50 with 20 years of service or at any age with 25 years of service.

To determine your eligibility and for more information, please do the following in order:

1. Review OPM's VERA Overview: [OPM VERA URL]

2. Review the "FAQs for VERA" (Attachment 1).

3. Review "Other Considerations for VERA" (Attachment 2).

4. Calculate an approximate annuity using the Federal Retirement Benefits (FRB) Calculator at: [Calculator URL]

Due to the large number of employees who are currently eligible under this VERA opportunity, we ask that you review the OPM VERA information and use the FRB Calculator for an initial estimate before contacting the Human Resources Manager.

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Voluntary Separation Incentive Payment Authority (Buyout)

This payment provides a financial incentive for eligible employees to voluntarily separate by Optional Retirement or VERA. The maximum amount payable for a buyout is $25,000 (gross amount) or a deemed calculated amount for severance pay, whichever is less. The amount payable for a buyout is expected to be set less than $25,000 for any follow-on VSIP opening periods. A sample buyout calculation form (Attachment 3) is provided for your use. Please note that if an employee separates with a buyout and subsequently accepts Federal employment within five years of separation, the gross amount of the buyout must be repaid.

To determine your eligibility and for more information:

1. Review "FAQs and Buyout Estimation Worksheet for VSIP" (Attachment 3)

2. Review "Tax Questions on Buyouts" (Attachment 4)

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Application Process

To apply, complete the "Application for VSIP" (Attachment 5). Please note a CSRS/FERS Application for Retirement will also be needed. Your servicing Human Resources Managers will contact you to initiate that paperwork once your Application for VSIP is received and eligibility is confirmed.

The window to apply for VERA and/or VSIP is no earlier than [START DATE], and closes [END DATE]. Please email your signed Application for VSIP as a PDF attachment to [EMAIL ADDRESS] within the cited timeframes. Applications submitted before [START DATE], or through any other means WILL NOT be accepted. The first [NUMBER] VSIP applications received and determined to meet the VERA or Optional Retirement eligibility criteria will be approved. The retirement must be effective no later than [RETIREMENT DATE].

You will receive an email acknowledging receipt of your Application for VSIP (Buyout) within one business day. Your application for VSIP (Buyout) will be reviewed to ensure all eligibility criteria have been met. You will then be notified of your approval/disapproval via email. If you are approved for the VSIP, you will be required to submit a CSRS/FERS Application for Retirement. Under this VSIP Authority, your CSRS/FERS Application for Retirement must be effective no later than [RETIREMENT DATE]. Once your entire CSRS/FERS Application for Retirement is received, it will be carefully reviewed by your appropriate Human Resources Manager before it is forwarded to the National Finance Center (NFC) for further action. NFC will then forward it to Office of Personnel Management (OPM) for final adjudication.

To Summarize:

-  The current VERA and VSIP window will open no earlier than [START DATE], and close no later than [END DATE], at 11:59 p.m. EST.

-  To determine your eligibility and for more information on VERA, please do the following in order:

  1. Review OPM's VERA Overview: [OPM VERA URL]

  2. Review the "FAQs for VERA" (Attachment 1).

  3. Review "Other Considerations for VERA" (Attachment 2).

  4. Calculate an approximate annuity using the Federal Retirement Benefits (FRB) Calculator at: [Calculator URL]

  5. Contact your Human Resources Manager if you have any additional questions.

-  To determine your eligibility and for more information on VERA:

  1. Review "FAQs and Buyout Estimation Worksheet for VSIP" (Attachment 3).

  2. Review "Tax Questions on Buyouts" (Attachment 4).

-  Employees who elect VERA and/or VSIP must retire no later than [RETIREMENT DATE].