Provisions affecting federal employees in a House-passed bill under consideration in a House-Senate conference on extending the reduction in the Social Security payroll tax.
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Provisions affecting current and future employees |
Provisions affecting only employees hired in 2013 or later and who have fewer than five years of prior federal service on hiring) |
| Extends freeze on federal salary rates for a third year, through 2013. | Bases annuities on highest five consecutive salary years rather than three. |
| For those retiring in 2013 and after, eliminates a retirement supplement for most Federal Employees Retirement System employees who retire before age 62; retains the benefit for those subject to mandatory retirement before 62. | Reduces the multiplier used in the retirement-benefit calculation, resulting in benefits for most that would be 30 percent lower than under the current FERS formula. |
| Requires an increase in the employee contribution to retirement of 1.5 percentage points, phased in equally over three years starting in 2013. |
Requires an immediate 3.2 percentage- point increase in employee retirement contributions. |
Note: The House last week passed a separate bill to extend the salary rate freeze. The other provisions are in a separate bill that passed the House Oversight and Government Reform Committee on Tuesday.
— Compiled by Eric Yoder
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