A federal labor organization says the government should not force workers to make retroactive retirement contributions after the government failed to collect them at the time the payments were due.
The American Federation of Government Employees (AFGE) says workers hired this year would have to pay up to $1,300, at a rate of $25 per pay period, until their “debt for underpayment” is satisfied.
According to AFGE, the government has been unable to collect full employee retirement contributions through paycheck deductions for employees hired in 2014 and won’t have that capability until late July or August. To make up for that, $25 will be deducted from their checks until the amount missed since the beginning of the year is covered.
Citing a memo from one Pentagon agency to its employees, AFGE said that the correct retirement contrbutions will be deducted from their checks beginning Aug. 21 and that the workers would be given the option for “payment of the debt in full or by installment.”
“It is wrong to treat this failure on the part of the employer to operationalize its payroll deduction system for as long as 17 pay periods a case where employees have incurred a ‘debt for underpayment’ to the government,” AFGE President J. David Cox Sr. said in a letter to Beth Cobert, a deputy director of the Office of Management and Budget. “This mistake is solely the responsibility of the agencies….This would be a heavy burden for newly hired federal employees who will already be struggling to make ends meet on inadequate salaries that were frozen for three years and adjusted by a mere one percent this year.”
OMB had no comment.
Cox asked OMB to “instruct all agency heads to exercise their authority to waive any overpayment to new employees due to the agency’s own inability to program computers in a timely manner.”