Social security relief for federal retirees, and other bills to watch after August recess

Despite the successful passage of a two-year budget deal, there’s still plenty of work left for Congress to tackle when it returns from August recess.

The Senate hasn’t introduced a single appropriations bill for fiscal 2020, meaning the possibility of the federal pay raise for civilian employees next year remains up in the air as well.

Senate Majority Leader Mitch McConnell (R-Ky.) placed a handful of nominations up for cloture when members return from August recess Sept. 9. Dale Cabaniss, the president’s nominee to be director of the Office of Personnel Management, is among those up for a vote.

Jim Byrne, the president’s pick to be no. 2 at the Department of Veterans Affairs, is also up for a confirmation vote.

Advertisement

Beyond the confirmation votes — and the inevitable sprint to avoid a government shutdown on Sept. 30 — here’s what else federal employees should keep an eye on as Congress returns to Capitol Hill early next month.

Relief from Social Security cuts for certain retirees

Lawmakers have been trying for more than a decade now to address the Windfall Elimination Provision (WEP), a complicated relic from a 1983 law that reduces Social Security benefits for certain federal employees under the Civil Service Retirement System (CSRS).

The WEP reduces Social Security benefits for federal employees who worked in Social Security-covered jobs, namely a position in the private sector, but also receive a government annuity from their federal employment.

The WEP reduces a factor in the formula used to calculate federal employees’ Social Security benefits from 90 percent to as low as 40 percent — for other jobs they take that are covered by Social Security.

According to the National Active and Retired Federal Employees (NARFE) association, WEP-impacted workers lose out on an average of $463 a month in Social Security benefits due to this formula.

The WEP’s goal was to prevent what members of Congress often called “double-dipping.” Before 1983, federal employees and retirees, whose employers did not withhold Social Security taxes, received a Social Security benefit that represented a higher percentage of their earnings, as well as a government pension.

Rep. Kevin Brady (R-Texas), ranking member of the House Ways and Means Committee, reintroduced the Equal Treatment of Public Servants Act in late July. Brady introduced a similar version of this bill back in 2016.

The legislation, which has bipartisan support, would replace the WEP with a new formula designed to offer some relief to impacted workers, which include federal, state and local government employees.

“By depriving dedicated public servants of full Social Security benefits that they rightfully earned through contributions to the Social Security system, the Windfall Elimination Provision is simply unfair,” Ken Thomas, NARFE national president, said in a July statement. “With low-earning households disproportionately affected by larger benefit reductions, the federal community experiences significant financial loss due to the WEP.”

The new formula in Brady’s bill would replace the WEP with one that equalizes Social Security benefits for employees with non-covered employment. WEP-impacted employees age 60 or older would get a monthly rebate of $100.

The WEP does not apply to members of the Federal Employees’ Retirement System (FERS), because employees under this system already pay into Social Security.

A legislative tweak to hire recent college grads

A Senate bill, which passed the Homeland Security and Governmental Affairs Committee in late July, makes a seemingly small fix to provisions included in last year’s defense authorization bill, which gave agencies expedited authority to hire college graduates and post-secondary students.

Sen. James Lankford (R-Okla.), chairman of the Homeland Security and Governmental Affairs Subcommittee on Regulatory Affairs and Federal Management, as well as subcommittee Ranking Member Kyrsten Sinema (D-Ariz.) and full committee Ranking Member Gary Peters (D-Mich.), introduced the legislation.

It addresses what senators and the Office of Personnel Management have described as an unintended consequence of the 2019 authorization act, which capped the number of students agencies could hire under this authority to 15% of the number of students hired into the competitive service last year.

The 2019 provisions were touted as a win for agencies, who have been struggling to inject more youth into their talent pipelines for years.

But few students actually receive jobs through the competitive service.

“Under the new law’s formula, there may be no base of students appointed to the competitive service in the previous fiscal year by an agency, and zero students may be hired using the new authority,” Margaret Weichert, acting OPM director, wrote in an October 2018 letter.

This new Senate bill eliminates mention of the competitive service, meaning agencies would be free to recruit recent college graduates simply based on the number of students hired during the previous fiscal year.

OPM proposed the same solution in a series of legislative proposals given to congressional leaders back in April.

Restrictions on federal bonuses

Another Senate bill, which also cleared the Homeland Security and Governmental Affairs Committee last month, would restrict agencies from handing out bonuses to federal employees who are fired or suspended for more than 14 days.

The Stop Improper Federal Bonuses Act would prevent giving federal employees a bonus if they’ve received some kind of disciplinary action for poor misconduct. The bonus ban would be in place for five years after the agency determined an employee had violated the organization’s policy or federal law.

Sen. Deb Fischer (R-Neb.) reintroduced the bill last month.

The Congressional Budget Office recently scored the bill at zero, though it acknowledged enacting the legislation could impact agencies that use fees or other collections to cover operating costs.

Copyright © 2019 Federal News Network. All rights reserved. This website is not intended for users located within the European Economic Area.