A record number of federal workers, 33,529, retired during the final months of this year, many apparently to get a lump-sum pension perk that Congress eliminated as of Dec. 1. In November, the peak month of the surge, the federal retirement rate jumped 106 percent.
Many young workers grew sick of frequent news about the lump sum. But the big jump in retirements suggests that a lot of people cared. Many left government much earlier than they intended. That will open up promotions down the line for younger workers who thought they had no personal interest in what appeared to be a pension goody for their older colleagues.
Before Dec. 1, retirees who elected to take reduced pensions could get a two-stage lump-sum payment. It represented about 7 percent of their lifetime salaries. The IRS doesn't consider the lump-sum payment as the retirees' previously taxed contributions to the retirement fund, although the payments were identical to what the retirees had contributed to the pension fund while they worked.
More than 70 percent of all retirees took the lump-sum payments. Congress eliminated them (except in rare cases) as of Dec. 1 for anyone retiring during the next five years. That pushed thousands to retire by the Nov. 31 deadline.
In August, when the fate of the lump-sum option was still being debated, 5,180 people retired. That was a drop of about 12 percent from August 1989. But when it became clear that the lump-sum benefit was in trouble, workers began pulling the plug in record numbers.
In September, 8,976 people retired from the government, a jump of 1,776 over September 1989. In October, 8,108 people retired, compared with 7,542 the previous year. In November, as federal workers watched Congress and the White House flip-flop over the benefit, the retirement rate shot up 106 percent. Nearly 9,000 people retired, compared with 4,343 retirements in November 1989.
This far into December, the Office of Personnel Management has received 1,079 confirmed retirement actions, an 87 percent jump over the same number OPM had this time last year.Honoraria Exceptions
Some federal workers would be exempt from the writing and speech-making ban effective Jan. 1, according to the Virginia-based Federal Employees News Digest. Next year, employees will be covered by a provision of the ethics reform act aimed at congressional honoraria.
But the newsletter says an advisory from the Office of Government Ethics indicates that fiction, poetry, lyrics and scripts may be exempt. Workers who violate the ban could be fined up to $10,000.
The American Federation of Government Employees union has asked U.S. District Court here to block the ban. AFGE President John Sturdivant said the honoraria ban was unintentionally extended to federal employees. "It is unconscionable to allow a mistake in the law to deprive government employees of the right to earn extra money writing . . . or giving speeches to outside organizations when they are off-duty," he said.
Sen. John Glenn (D-Ohio) has promised hearings on the ban early next year before his Senate Governmental Affairs Committee. But the law will be effective Jan. 1 unless the court agrees to a preliminary injunction.