U.S. Department of Transportation
Federal Highway Administration
1200 New Jersey Avenue, SE
Washington, DC 20590
FHWA Order M3000.1C
|FHWA Personnel Management Manual; Part 1: Personnel Systems & Procedures, Chapter 10: Retirement, Insurance, Income Protection, and Other Employee Services, Section 3: Civil Service Retirement System (CSRS)|
|M3000.1C||November 4, 2005|
What is the purpose of this section? This section establishes responsibilities and procedures related to retirement, insurance, and income protection for employees under the Civil Service Retirement System (CSRS). This section is designed to be used in conjunction with the Civil Service Retirement System and Federal Employees Retirement System Handbook for Personnel and Payroll Offices (CSRS/FERS Handbook).
Title 5, United States Code (U.S.C.), Chapter 83.
Title 5, Code of Federal Regulations (CFR), Part 831, Retirement.
The servicing human resources office is responsible for:
Determining employee's eligibility for CSRS coverage;
Counseling and informing employees of their benefits, obligations, required forms, and procedures, and providing assistance in completing required forms;
Making creditable service determinations for computation purposes;
Considering position reassignment options, if possible, when the employee applies for disability retirement;
Providing counseling assistance to the family of a deceased employee; and
Reviewing and processing completed retirement forms and resolving any problems that may arise.
Supervisors are responsible for:
Preparing the Standard Form (SF)-52, Request for Personnel Action, for each retiring employee and submitting it with other required forms to the servicing human resources office for processing;
Arranging for the servicing human resources office to provide counseling assistance to the employee's family upon death of an employee; and
Furnishing a supervisor's statement in connection with any Application for Disability Retirement.
Employees are responsible for:
Completing the required forms and providing other information when applying for retirement;
Obtaining retirement counseling, annuity estimates, required forms, and other desired information; and
Keeping the servicing human resources office apprised of any change in personal status affecting retirement entitlements.
Who is covered by CSRS? All career or career-conditional employees hired prior to January 1, 1984, are automatically covered under CSRS, unless specifically excluded by law or regulation. Employees previously covered under CSRS who are rehired after a break in service of less than 365 days will be covered by CSRS. Employees who: (1) were previously covered by the CSRS for five or more years, and (2) leave Federal service and return after a break in service of more than 365 days will be covered by the CSRS Offset Plan. This means that the employee will be covered by Social Security and the CSRS.
CSRS employees will be required to contribute 7 percent of their total salary into the retirement fund, plus 1.45 percent of their total salary for Medicare. The Social Security Administration periodically adjusts the Medicare contribution percentage.
CSRS Offset employees will contribute 8.45 percent of their total salary, the same as for a CSRS employee. Specific information on employee contributions is listed in the CSRS/FERS Handbook.
Employees may, at their option, make voluntary contributions to the Thrift Savings Plan. Specific information regarding the Thrift Savings Plan is found in paragraph 7 of this section.
Retirement eligibility. Under the CSRS, employees may retire and receive an immediate annuity if they have a combination of age and Federal service as shown in the Attachment 1 at the end of this section.
Annuity formula. The basic annuity is a percentage of the employee's "high-3"; average salary. The "high-3"; average salary is based on the highest 3 years of base pay or salary earned in any consecutive 3-year period (usually the employee's last 3 years).
The "high-3"; percentage is determined by a three-part formula based on the length of creditable service. The employee earns:
1.50% per year for the first 5 years or 7.50% plus
1.75% per year for the next 5 years or 8.75% =
2.00% per year for service over 10 years
By law, the percentage is limited to 80% (reached after 41 years and 11 months of service); however unused sick leave can be used with the formula to produce a higher annuity. Unused sick leave is converted into months and days and added to the employee's other service. Credit is given for whole months only in 30 days increments. However, the time representing days of unused sick leave is not counted toward the employee's "high-3"; years average salary or for establishing eligibility for retirement.
An employee can increase his/her retirement income by buying additional annuity through voluntary contributions to the retirement system. The servicing human resources office can provide specific information on buying additional annuity. Further information can be found in the CSRS publication Retirement Facts 10, Voluntary Contributions under the Civil Service Retirement System.
When reaching age 62, employees under the CSRS Offset Plan will have their annuity reduced by the amount of their Social Security benefit attributable to their dually-covered service.
Disability retirement. If an employee retires on disability, the employee is guaranteed a minimum basic annuity that amounts to the lesser of:
40 percent of the "high-3" average pay, or
the earned annuity if the length of service was extended to age 60.
Retirement before age 55. If an employee voluntarily retires during a major reduction-in-force or is involuntarily separated and is younger than age 55, the annuity will be reduced by 1/6 of 1 percent (2% per year) for each month under age 55. There is no age reduction of an employee who retires under the disability provision.
If an employee dies after 18 months or more of Federal civilian service, the widow or widower will automatically get an annuity, provided they were married at least nine months (or if there is a child from the marriage). The widow or widower is entitled to a guaranteed minimum yearly annuity, which is 55 percent of the lesser of:
22 percent of the employee's "high-3" average pay, or
55 percent of the amount the annuity would have been if the employee had continued working until age 60 at the same "high-3."
A spouse's survivor annuity begins on the day after the employee's death. It ends at the end of the month preceding the month in which the survivor dies or remarries before age 55.
Unmarried dependent children will also be entitled to annuities if an employee dies while in service. Their annuities will continue until they reach age 18, or age 22 if they are full-time students. A child declared incapable of self-support by reason of mental or physical disability incurred before age 18 will continue to receive an annuity. The Office of Personnel Management (OPM) will arrange for a physical examination to make the determination.
What is the Thrift Savings Plan? All CSRS and CSRS Offset employees are eligible to participate in the Thrift Savings Plan. Participation is totally voluntary. Please refer to the Summary of the Thrift Savings Plan for Federal Employees for specific information about this program.
Employees should contact their servicing human resources office for a complete explanation and copies of the required retirement forms.
Employees should submit the completed retirement forms to their supervisor prior to separation to apply for retirement benefits. The supervisor should forward these forms, along with a completed SF-52, Request for Personnel Action, to the servicing human resources office for processing.
What are my health insurance benefits? Specific information regarding eligibility for continuing health benefits coverage during retirement and other aspects of the Federal Employees Health Benefits (FEHB) Program as it relates to the retiring employee is found in the FEHB Handbook.
What are my life insurance benefits? Specific information regarding eligibility for continuance of life insurance coverage during retirement and other aspects of the Federal Employees Group Life Insurance (FEGLI) Program as it relates to retiring employees is found in the FEGLI Program Handbook.
What is a refund of retirement deductions? An employee who separates from the Federal service may request the refund of retirement deductions by submitting the SF-2802, Application for Refund of Retirement Deductions, to the servicing human resources office or, if he or she has been separated more than 30 days, directly to the OPM. If the employee is (was) married while contributing under CSRS, notification of the employee's current (or former) spouse is required.
What are deposits and redeposits to the retirement fund? The SF-2803, Application to Make Deposit or Redeposit, is to be completed by the employee when applying to make a deposit to the retirement fund for creditable service when deductions were not made or to make a redeposit when deductions were previously withdrawn. The SF-2803 should be forwarded to the servicing human resources office for processing.
|Type of Retirement||Minimum Age||Minimum Service (years)||Special Requirements|
|Early Option||Any Age||25||The FHWA must be undergoing a major reduction in force or a major transfer of function as determined by OPM.|
|Discontinued Service||Any Age||25||The separation must be involuntary and not for misconduct or delinquicy.|
|Disability||Any Age||5||Must be disabled for useful and efficient service in the employee's current position and any other vacant position at the same grade or pay level within the employee's commuting area and current agency for which the employee is qualified.|
|Deferred||62||5||Must have completed at least 5 years of civilian service and been employed under the CSRS for at least 1 year within the 2 year period immediately preceding the separation. Annuity to start at age 62.|