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.

Provisions affecting
current and future
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