Shutdown FAQs: Pay, benefits and retirement questions answered

Updated as of Jan. 24 to reflect new information from the Office of Personnel Management on taking annual and sick leave during a government shutdown, an additional update on unemployment benefits and a FEDVIP extension. 

As the partial government shutdown drags on and surpasses the longest lapse in history, agencies and their employees face a revolving door of new questions about the impact on their pay, benefits, taxes, retirement and leave banks.

The timing and length of this particular government shutdown has pushed agencies into unprecedented territory, and in some cases, it’s creating the need for answers to questions that haven’t been addressed before.

Federal News Network is soliciting your questions about your pay, benefits, retirement and other general topics during the government shutdown.

Direct your questions to the Federal News Network Facebook page or Twitter account, or via our website comments. We will do our best to answer as many as we can. We will also update this page as more information from the Office of Personnel Management, Office of Management and Budget and individual agencies becomes available.

We will continually update this page as we receive more information and reader questions. New questions and answers will appear at the top of the page and will be indicated as additional FAQs as we receive them.

Updated 1/24: What happens to my federal dental and vision insurance?

Coverage under the Federal Federal Employees Dental and Vision Program (FEDVIP) will continue during the shutdown.

OPM recently extended the number of consecutive pay periods enrollees in FEDVIP would have to miss before they received bills for missing premiums from two to three.

If the shutdown continues for three consecutive pay periods, BENEFEDS will begin to directly bill enrollees for premium payments. FEDVIP participants must pay those bills if they want their coverage to continue.

If the shutdown lasts for less than three consecutive pay periods, premiums will accumulate and will be withheld later until employees go back to work.

See OPM’s updated pay and benefits guide here.

Updated 1/24: Can I take a sick day or any other time off during the shutdown?

Federal News Network has received many questions about leave during this government shutdown, and OPM has finally weighed in on the topic.

The answer is yes. Excepted employees have two options to take annual or sick leave during the government shutdown without penalty.

Employees who are working without pay can request and take approved leave as they normally would as if the government shutdown wasn’t going on, OPM said in a Jan. 23 memo. Excepted employees will be charged for the time in their personal leave banks after the fact, and they won’t be paid for those hours until the government shutdown ends.

Excepted employees can also take approved leave and accept “default furlough status” for the hours or days in which they take leave. Employees who take off and accept “furlough status” will be paid for the time after the fact, and they won’t be charged leave.

OPM acknowledged the second option is likely more favorable for excepted employees.

At the same time, excepted employees who fail to show up for work during the government shutdown and don’t receive approval from their supervisors for taking time off will be considered “absent without leave,” otherwise known as AWOL, for the duration of the absence, according to OPM.

“The employee’s unauthorized absence should be coded in payroll as AWOL,” OPM wrote in a Jan. 18 memo. “Agencies may elect to provide the employee a written notification about his or her AWOL status at the time of the AWOL but this can vary by agency. The agency may use its discretion, based on the facts and circumstances of the employee’s situation, to apply appropriate consequences based on the AWOL status.”

Updated 1/24: Can excepted employees apply for unemployment?

Excepted employees who are working for their agencies on a full time basis are generally not eligible for unemployment benefits during the government shutdown, according to a Jan. 18 memo from OPM.

However, excepted employees who work on an intermittent basis — seasonal, part time work — may apply for unemployment. Employees should apply for these benefits in the state where they work, unless their last official duty station was not within one of the 50 U.S. states, District of Columbia, Puerto Rico or U.S. Virgin Islands. If this is the case, furloughed or intermittent excepted employees should file for unemployment in the state or U.S. territory where they currently live, according to OPM.

Rep. Anthony Brown (D-Md.) on Jan. 24 introduced new legislation that would allow excepted employees working without pay to file for unemployment.

Some states, including California, Colorado, Vermont and D.C., have decided on their own to approve unemployment eligibility for excepted employees, according to Brown. His bill would extend eligibility to essential employees working at all states.

The bill has support from Virginia Reps. Don Beyer, Elaine Luria and Jennifer Wexton, along with Maryland Reps. David Trone and Jamie Raskin, Rep. Lori Trahan (D-Mass.) and D.C. Del. Eleanor Holmes Norton.

New 1/21: If I am potentially eligible for unemployment benefits during the shutdown, do I need to prove that I’m looking for other work?

Employees’ eligibility for unemployment benefits varies by state. Each state has its own eligibility requirements to participate in the Unemployment Compensation for Federal Employees program. 

To receive benefits, many states may require that applicants demonstrate they’re actively looking for other employment. Some states may waive this eligibility requirement. OPM advises federal employees check with their own states to learn about their own program’s eligibility requirements.

See a state-by-state reference guidance for unemployment benefits here.

The District of Columbia, Maryland and Virginia have indicated they’ll waive the requirement for federal employees to show they’re looking for other work in order to receive unemployment benefits, OPM said.

Federal employees can use a variety of forms of documentation to apply for unemployment in their states, according to OPM. Employees who don’t have access to their most recent SF-50 while furloughed can also use a leave and earning statement or a W-2.

Federal employees need to show documentation to begin a claim because agencies do not report wages to individual states like most other employers do, OPM said.

Scroll further in this story for more information on unemployment benefits during the government shutdown.

New 1/21: Can I get a reimbursement for my transit benefits if I’m working during the shutdown?

Yes.

Agencies impacted by the government shutdown may not have the funds to pay their employees — even excepted employees who are still working during the lapse in appropriations — the transit benefits they would typically earn.

Once the government shutdown ends, excepted employees can submit a SF Form 1164 reimbursable claim with their agency’s transit benefit point of contact, according to OPM.

Agencies should develop a process for handling these claims from excepted employees awaiting transit benefits, OPM said.

Updated 1/18: If I retired during the shutdown, am I actually retired?

Yes, federal employees who submitted their retirement application to their agencies before the shutdown began with an effective date during the shutdown, are retired.

Whether their paperwork has been processed, however, is a different story, and it depends on whether the staff at your agency’s payroll office is furloughed. If they are, processing of your retirement could be delayed.

Employees who retired during the shutdown won’t need to return to work when the shutdown ends, according to the National Active and Retired Federal Employee Association (NARFE). They are retired, even if their agencies or OPM haven’t finished processing their paperwork.

New retirees should receive their first annuity payments about two-to-four weeks after OPM has received all materials it needs to accurately adjudicate and process an employee’s retirement, NARFE said.

Updated 1/18: Can I retire during the government shutdown?

It may be more difficult for employees to retire during the government shutdown who haven’t yet submitted any paperwork to their agencies. Again, some agencies may have staff working during the shutdown who can process retirement applications. Some may not.

OPM Retirement Services is still working during the government shutdown. But it can’t process your retirement application until your agency has completed its part of the process.

In addition, employees will need to return federal property, including their personal identity verification (PIV) card, back to their agencies.

The Department of Housing and Urban Development, for example, has a specific message on its website describing how employees can separate from the agency. HUD instructs employees to email specific contacts for directions.

Updated 1/17: Will I receive my previously-scheduled GS step increase?

Extended furloughs, like this one, will likely impact the timing of General Schedule step increases that were already approved prior to the shutdown, according to OPM guidance.

Agencies can’t, however, deny or delay step increases because of a lack of funds.

After past shutdowns, OPM advised agencies to make a within-grade step increase effective on the day the increase was originally due. Therefore, if you were scheduled to receive a within-grade increase on Jan. 5, as an example, your retroactive back pay would reflect the increase as of Jan. 5.

Will I get paid?

Yes. President Donald Trump signed the Government Employee Fair Treatment Act into law on Jan. 16. It ensures that both furloughed and excepted federal employees receive back pay after the government shutdown ends. It also specifies that federal payroll providers begin to process checks as soon as the lapse in appropriations ends, regardless of the next scheduled pay date.

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By law, federal employees can’t receive any pay for work done during a government shutdown until the lapse in appropriations ends.

Excepted employees who are required to work during a shutdown will eventually get paid, but not until after the shutdown ends. Generally speaking, non-excepted employees who are furloughed aren’t guaranteed pay unless Congress and the President have specifically authorized it. 

As mentioned earlier, the President has already authorized back pay for federal employees after this shutdown ends.

Federal contractors, however, are in a different boat. Congress has no real mechanism to ensure the federal contracting community gets paid during a government shutdown. Individual companies can decide to pay their contractor-employees when the shutdown ends, but again, there’s no guarantee.

A group of Senate Democrats has introduced legislation that would ensure low-wage federal contractors receive back pay during this shutdown. But no similar legislation has ever cleared Congress before.

When will I get paid?

At this point, a definitive or ballpark estimate is tough to approximate. The legislation that Trump signed into law specifies that payroll providers work as quickly as possible to send out checks, regardless of the next scheduled pay period.

OPM has issued more specific guidance on this question in the days following past government shutdowns. The agency will likely provide more details soon after the current lapse ends.

How will I receive my back pay?

We won’t know for sure until the shutdown ends and OPM issues more detailed guidance.

But after the 16-day government shutdown in 2013, most federal employees received back pay as a lump sum. Federal employee unions expect that whenever this shutdown ends, furloughed and excepted employees would receive a lump sum payment, rather than a series of installments.

Again, the back pay legislation that Trump signed on Jan. 16 instructs payroll providers to process checks as quickly as possible, regardless of the next scheduled pay period.

Is my retroactive pay considered 2018 or 2019 taxable income?

OPM will likely issue specific guidance with more detail after the lapse in appropriations ends. But history can give us an indication of what that guidance will likely say.

According to OPM guidance issued after the 1995-1996 government shutdown, excepted and furloughed federal employees were to be compensated “as though they had performed work for the agency during all periods of regularly scheduled duty,” the agency said. “Therefore, employees are entitled to receive their rate of basic pay for all periods of time during which they would have been in a pay status but for the lapse in appropriations.”

This guidance suggests that for employees who worked without pay or were furloughed on days in 2018, back pay for those days would count as 2018 taxable income. The same mentality, in theory, may apply for work or furlough days in 2019.

Though the 1995-1996 government shutdown was the second-longest lapse in history, agencies reopened on Jan. 6, leaving payroll providers enough time to issue W-2s denoting an employee’s entire income for 1995.

But without a clear end in sight to this current government shutdown, we can’t say for sure that payroll providers will be able to provide a complete picture of an employee’s 2018 income in time for the release of his or her W-2.

Federal News Network will update this response when more information becomes available.

What happens to my use-or-lose leave?

OPM has since clarified: Agencies should restore any annual leave their employees lost at the end of 2018 due to the government shutdown.

Because all paid leave is canceled during a government shutdown, employees who had scheduled to take annual leave during the holidays had to forfeit the time.

But these circumstances put some employees in a tricky situation. Federal employees generally can carry some leave with them from year to year, as long as it doesn’t exceed the annual leave ceiling. But many employees specifically save their “use-or-lose” leave for the end of the year during the holidays.

For some, the government shutdown meant certain excepted employees not only had to cancel their leave and come into work but also exceed the annual leave ceiling.

The 2018 leave year ended on Jan. 5, 2019 for employees on the standard biweekly pay period cycle. Agencies can restore lost-leave scheduled before Jan. 5, as long as employees had requested to take that leave in writing before Nov. 24, 2018, according to OPM.

As long as this partial government shutdown continues, federal employees can’t substitute annual leave for a furlough. The Antideficiency Act, which essentially bars government from spending money it doesn’t have, prohibits employees from taking paid time off.

Can I still accrue annual or sick leave?

Furloughed employees won’t accrue annual and sick leave during a shutdown once they’ve reached non-pay status for 80 hours, according to OPM guidance. Congress and the President have authorized a retroactive accrual of leave in the Jan. 16 back pay bill.

Excepted employees will continue to accrue leave, but again, workers can’t take it until the shutdown ends.

Can I file for unemployment?

Furloughed federal employees are eligible to apply for unemployment benefits, but excepted employees working on a full-time basis generally aren’t eligible, according to OPM.

Furloughed employees, however, will be required to pay back any unemployment benefits they received once the shutdown ends and federal payroll providers begin to process retroactive paychecks.

Employees’ eligibility for unemployment varies by state. In most circumstances, the state where an employee’s official duty station is located is the state that will determine a worker’s unemployment eligibility in the Unemployment Compensation for Federal Employees Program. State unemployment insurance agencies administer this program on behalf of the federal government.

Federal employees who are eligible can apply for unemployment benefits on or after the first day of their furlough.

To file an unemployment claim, federal employees should first contact the state where they work to get started, OPM said. Some states may require employees to wait a week after filing a claim before they receive a payment. In general, most states will issue benefits within 14-to-21 days after an employee filed a claim, according to OPM.

Each state has different requirements that federal employees must meet first to be eligible.

Most states pay a maximum of 26 weeks of regular benefits, according to OPM, but the benefits themselves vary depending on location.

Find more information on unemployment benefits from OPM here. See a state-by-state reference guidance for unemployment benefits here.

The General Services Administration has a checklist of documents that furloughed federal employees should find before applying for unemployment benefits.

Will W-2s be delayed?

A spokesman for the Agriculture Department said the National Finance Center will begin to send out W-2s to employees by Jan. 25. The mailing process will continue through Jan. 31.

NFC will process and distribute some 705,000 W-2s, according to a message on the USDA website. Most will be available on employee personal pages near the end of January, but about 9,000 of them will be suspended from the electronic site, according to USDA. NFC will slowly release those W-2s from suspense and will mail and issue them electronically.

Any NFC client who hasn’t received a W-2 by Feb. 4 should contact the NFC reporting center.

The General Services Administration Payroll Service Branch will make W-2s available for their clients no later than Jan. 31, 2019, according to GSA.

The Interior Business Center didn’t immediately respond to questions about the status of W-2s during the government shutdown.

What happens to my federal health insurance?

Your coverage under the Federal Employees Health Benefits Program (FEHBP) will continue during the government shutdown. Enrollment in FEHBP continues for up to one year in non-pay status.

Your contributions toward your health premiums will accumulate. They’ll be withheld until the government reopens and impacted employees receive back pay.

The government will continue to make its FEHBP contributions even during this shutdown, because OPM uses the Federal Employees Health Benefits Fund to make payments.

For participants who made changes to their health insurance during open season, those changes should have gone into effect Jan. 1 regardless of the current shutdown.

The National Active and Retired Federal Employees (NARFE) Association has suggested FEHBP participants check with their new carriers to make sure they’re covered.

Blue Cross Blue Shield, one of the most popular insurance options for participants in the FEHBP, reminded members their coverage will continue during the government shutdown.

“The BCBS Federal Employee Program continues to process claims and reimburse doctors, hospitals, and other health care providers,” William Breskin, senior vice president of government programs for BCBS Association, said Jan. 18 in a statement. “Eligible FEP members can also contact their local Blue Cross and Blue Shield company if they have a qualifying life event, such as the birth of a baby, that allows them to change their coverage or add eligible individuals to their policy.”

New enrollments or changes to enrollment because of a qualifying life event generally won’t go into effect until an employees returns to pay status. The birth or addition of a child is the exception, according to OPM.

What about group life insurance and long term care insurance?

Coverage under the Federal Employees’ Group Life Insurance (FEGLI) continues for up to 12 months in non-pay status. FEGLI only collects premiums for pay periods when enrollees receive pay.

Coverage under the Federal Long Term Care Insurance Program continues during the shutdown. But if Long-Term Care Partners doesn’t receive premiums for three consecutive pay periods, it will begin to directly bill participants.

…And my flexible spending account?

Payroll deductions to your flexible spending account (FSAFEDS) will stop when you don’t receive a paycheck. You’re still enrolled in FSAFEDS, but you can’t be reimbursed for eligible health care claims until you return to pay-status.

“Payroll deductions will be subsequently collected to match your annual election amount,” OPM guidance reads.Eligible dependent care expenses incurred during the lapse in appropriations may be reimbursed up to whatever balance is in your dependent care account—as long as the expense incurred allows you (or your spouse, if married) to work, look for work, or attend school full-time.” 

How is my retirement impacted?

Employees impacted by the shutdown aren’t making contributions toward their retirement because they’re not getting paid.

The shutdown won’t have an impact on an employee’s retirement-creditable service or high-3 average pay unless the lapse lasts for more than six months, according to OPM.

Annuity payments for current retirees will continue. A significant share of the operations of the Office of Personnel Management, including the office that processes retirement benefits, is funded through sources other than appropriations. The annuities themselves are also paid from trust funds that do not depend on annual spending bills.

Military retirees of the U.S. Coast Guard, however, are in a different position. If the government shutdown continues through the month of January, the service will not have funds to disburse February retirement checks to retired Coast Guard members.

Unlike other federal agencies and branches of the armed services, the Coast Guard uses a pay-as-you-go appropriation to fund military retiree payments.

What should I do to suspend TSP loan payments?

Typically, the Thrift Savings Plan requires agencies and military services to send documentation that an employee has entered “non-pay” status in order to suspend loan payments and prevent those loans from going into default.

During this shutdown, the TSP isn’t requiring a notice.

“The TSP does not need documentation of your furlough at this time,” according to a message on the plan’s website. “If your loan payments were up to date prior to the furlough, missing one or two payments will not cause your loan to be in default.”

Can I make allotments from pay?

Federal employees can’t make allotments during the shutdown because they’re not getting paid. OPM suggests employees impacted by the shutdown review allotments and decide whether they’ll need to make alternative arrangements to make loan or other payments.

The government shutdown has impacted TRICARE health plans and dental program allotments made on or after Jan. 1, 2019, the Coast Guard said.

TRICARE can’t process these payments from retirees of the Coast Guard, U.S. Public Health Service and National Oceanic and Atmospheric Administration commissioned corps.

No one will disenrolled for non-payment, the Coast Guard said. TRICARE will continue to process claims and coverage will continue during the shutdown.

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