[BBS file "VSIPIAG1.TXT" and "VSIPIAG1.ZIP"; this March 25, 1994,
upload of the package updates our early March 24, 1994, buyout
package upload under the same file name.  The package incorporates
additional late information available on the buyout bill.  This is
the package available from OPM late on Friday, March 25.  We will
update this package again on the BBS when a copy of the legislation
is available for posting, or if other later updates are made.
=================================================================

MEMORANDUM FOR DIRECTORS OF PERSONNEL

FROM:        LEONARD R. KLEIN  (signed)      March 25, 1994
             ASSOCIATE DIRECTOR
                    FOR CAREER ENTRY

Subject:     New Legislation on Voluntary Separation Incentive
                  Payments and Employee Training 

LEGISLATION

Congress has passed legislation, recommended by the President's
National Performance Review, to authorize agencies to offer
incentive payments or "buyouts" to encourage employees to resign or
retire voluntarily.  The legislation also removes restrictions on
employee training to make it easier for agencies to retrain
employees.  

Agencies may implement the incentive payments program as soon as
the President signs the legislation.

This legislation retains the flexibilities of the Administration's
bill, which we distributed to you in October 1993.  It allows
agencies to determine the length of their incentives offer
"window."  They are not obligated to use a 90-day period as had
been discussed during earlier Congressional deliberations. 
Agencies may offer incentives through March 31, 1995.  Employees
who take incentives may be retained up to March 31, 1997.  The
eligibility criteria and amount of incentives have remained the
same, but the bar on reemployment without repayment has been
extended to 5 years.  

Funding provisions and mandated personnel reductions in the bill
have also changed significantly, requiring:

-    Agency payment of 9 percent of the final salary of each CSRS
     employee who takes an incentive and voluntary early retirement
     during FY 94 and FY 95.

-    Agency payment of $80 for each CSRS and FERS employee on an
     agency's roll as of March 31 of each year from FY 95 through 
     FY 98--even if incentives are not used.

-    Reduction of one position for each incentive paid.

-    Reduction of total executive branch employment in each year
     from FY 94 through FY 99, with a governmentwide hiring
     freeze if new limits are not met.
  
A section analysis of the legislation, a summary of its main
points, and an updated version of OPM's Guide to Voluntary
Separation Incentive Payments are attached.  These materials also
are available on two OPM electronic bulletin boards (at 912-757-
3100 and 202-606-4800).  On both boards, the file name for the
legislation is VSIPLAW.TXT.  We will add the public law number once
it is signed.  The file name for the guide is VSIPIAG1.TXT.

REPORTING INCENTIVES TO OPM

The law requires OPM to report to Congress each year on the number
of employees who received incentives by agency, grade, and
location, and the number of waivers for reemployment without
repayment of the incentive, by position and grade.  Attachment 2 
includes special personnel action documentation requirements
(paragraph R) and Attachment 4 includes special reporting
provisions for agencies to insure compliance with the statutory
reporting requirement. 

STREAMLINED EARLY RETIREMENT PROCEDURES

Acting on a recommendation of the National Performance Review, OPM
has changed the guidelines for early retirement authority.  Under
the new procedures, agencies facing severe downsizing may obtain
early retirement authority, to use agencywide or by component, for
up to 1 year, with option to renew for a second year.  See
Attachment 4.

ASSISTANCE FROM OPM

OPM's new Federal Workforce Restructuring Office coordinates
assistance to agency headquarters on all downsizing programs,
including the voluntary separation incentive payments and
streamlined early retirement procedures.  You may contact this
office at 202-606-0960 or FAX 202-606-2329.  The office is
located in Room 6504 at 1900 E Street, N.W., Washington, DC
20415.

For specific questions on preparations for processing retirement
actions, please contact Eileen Kirwan in OPM's Retirement and
Insurance Group on 202-606-0510.

For detailed information on the training provisions in the
legislation, please call our Human Resources Development Group at
202-606-1575. 





ATTACHMENTS   

     Attachment 1:  Key Features of Incentives Programs under the
     Federal Workforce Restructuring Act of 1994
  
     Attachment 2:  OPM Guide to Voluntary Separation Incentive
     Payments

     Attachment 3:  Samples for agencies to use in communicating
     with employees about voluntary separation incentive
     payments, including announcements, interest surveys,
     documentation, and separation agreements.
     
     Attachment 4:  New Streamlined Voluntary Early Retirement
     Procedures

     Attachment 5:  Instructions for using OPM's electronic
     bulletin boards

     Attachment 6:  Federal Workforce Restructuring Act of 1994

[BBS Note-Attachment 1 begins on next page.]
































Attachment 1

KEY FEATURES OF INCENTIVES PROGRAM

           FEDERAL WORKFORCE RESTRUCTURING ACT OF 1994
                         March 25, 1994

         To avoid or minimize involuntary separations due to
restructuring, executive branch agencies may pay voluntary
separation incentive payments (VSIP) to employees in any component,
occupation, and/or location up through March 31, 1995, and delay
employee separations up to March 31, 1997, to ensure performance of
the agency's mission.

         To receive a VSIP offer, an employee must--

     -    be serving under appointment without time limit,

     -    have 12 months of continuous service, and

     -    not be a reemployed annuitant or eligible for disability
retirement.

         The VSIP amount is the lesser of $25,000 or an employee's
severance pay entitlement.

         An employee must repay the full VSIP if employed by the
government, by appointment or personal services contract, within 5
years after separation.

          At agency request, OPM may waive repayment where an
individual with unique abilities is the only qualified candidate
for appointment to a position.

         Agencies must pay to the retirement fund--

     -    9% of the final basic pay of each employee who takes an
Incentive AND voluntary early retirement under the Civil Service
Retirement System (CSRS) during FY94 and FY95.

     -    $80 per year for each employee on an agency's rolls under
CSRS or FERS (Federal Employees Retirement System) as of March 31
of FY95, FY96, FY97, and FY98--regardless of whether an agency uses
VSIPs.

         Agencies must reduce employment levels:

     -    Reduction of one funded position for each VSIP paid.

     -    Total executive branch employment must reach specific
levels in each year from FY94 through FY99.  The Office of
Management and Budget will monitor employment levels and freeze
governmentwide hiring if lower levels are not met.

         No funds appropriated for salaries and expenses of
eliminated positions may be used for any purpose other than
authorized separation costs.

         Agencies may not increase service contracts as a result of
VSIP programs, unless such contracts give the government a
financial advantage.

         OPM must report to Congress each fiscal year on the number
of VSIPs paid by agency, grade, and location, and the number of
waivers approved for reemployment without repayment of VSIPs.
 
         Although DOD and CIA have separate VSIP authority, this
act covered them under the above provisions dealing with employee
repayment of VSIPs on reemployment, agency payments to the
retirement fund, and reductions in total executive branch
employment.


[BBS Note-End of Attachment 1.  Attachment 2 begins on next page.]


































Attachment 2


                            Guide to
             Voluntary Separation Incentive Payments
      under the Federal Workforce Restructuring Act of 1994
                          P.L. 103-   


The purpose of this guide is to assist agencies in the use of
Voluntary Separation Incentive Payments, a valuable tool to help
them restructure their workforce while avoiding involuntary
separations.
  
A.  Legal Authorities

Executive agencies--except the Department of Defense (DOD), the
Central Intelligence Agency (CIA), and the General Accounting
Office (GAO)--are authorized by Public Law 103-   to offer
Voluntary Separation Incentive Payments (Incentives) to employees
who voluntarily resign or retire.  DOD has separate authority under
5 U.S.C. 5597 to offer Incentives, CIA has similar authority under
P.L. 103-36 and GAO under P.L. 103-69.  However, DOD and CIA are
covered by certain provisions of P.L. 103-  , as discussed
elsewhere in this Guide.    

Although not required, voluntary early retirement authority, used
in conjunction with Incentives, can increase the number of workers
who leave voluntarily.  Early retirements may be authorized for
employees under the Civil Service Retirement System (CSRS) by 5
U.S.C. 8336(d)(2) and for employees under the Federal Employees
Retirement System (FERS) by 5 U.S.C. 8414(b)(1)(B).  See Attachment
4 for more information.

B.  Reduction of Federal Positions

P.L. 103-   requires reductions in Federal employment --

o    The total number of funded positions in all agencies is to
     be reduced by one position, on a full-time equivalent basis,
     for each Incentive paid under P.L. 103-  .  DOD, CIA, and
     GAO are not subject to this requirement.  No funds for
     salaries or expenses of eliminated positions may be used for
     any purpose other than authorized separation costs.  

o    Total employment in all executive agencies, including DOD
     and CIA but not GAO, is to be reduced in each fiscal year
     from FY 94 through FY 99.  OMB will oversee compliance with
     reduction requirements.  If reduction requirements are not
     met, all hiring is frozen unless the President approves a
     waiver because of emergency needs or critical agency
     mission.

o    No increase is allowed in service contracts because of P.L.
     103-   except where a cost comparison shows a contract has a
     financial advantage.

C.  Additional Payments to the Retirement Fund

P.L. 103-   imposed two payments --

o    For separations in FY 94 and FY 95, agencies paying
     Incentives under P.L. 103-   must pay the retirement fund an
     amount equal to 9 percent of the final basic pay of any CSRS
     employee who receives an Incentive and takes a voluntary
     early retirement.  (Final basic pay means the total amount
     of basic pay that would be payable to an employee for a year
     of service, computed using an employee's final rate of basic
     pay, with adjustments for less than a full-time work
     schedule.)  Discontinued service retirements are not subject
     to this requirement.

     DOD and CIA are subject to this payment for CSRS employees
     separating on and after the date of enactment of PL 103-  
     and before October 1, 1995, with an Incentive and voluntary
     early retirement.  

o    In FY 95 through FY 98, all executive agencies (except GAO)
     must pay $80 per year to the retirement fund for each
     employee covered by CSRS or FERS as of March 31 of each
     year.  These payments are required regardless of whether an
     agency pays Incentives.  

D.  What is an Incentive?

An Incentive is a lump-sum amount an agency pays to an employee
after his or her voluntary separation.  The amount is equivalent to
the severance pay an employee would receive up to $25,000 and is
paid from funds the agency would use for the employee's salary. 
Use 5 USC 5595(c) to compute the amount as if an employee were
eligible for severance pay, even though the employee is not
required to be eligible for it.  No reduction is made for any prior
severance pay an employee has received. An agency has no discretion
to pay other than the full amount figured under this formula.  

An Incentive shall not be a basis for payment, and shall not be
included in the computation, of any other type of Government
benefit.  It shall not be taken into account in determining the
amount of any severance pay to which an employee may be entitled
under 5 USC 5595 based on any other separation.

E.  Who is Covered by Incentives?

Employees covered by Incentive programs include --

o    those who meet the definition of "employee" in 5 USC 2105
     (which covers employees in the Senior Executive Service,
     competitive service, and excepted service, including the
     Foreign Service), and 
 
o    employees of county committees established under section
     8(b) of the Soil Conservation and Domestic Allotment Act (16
     U.S.C. 590h(b).

To be eligible for an Incentive, an employee must:

o    Agree to resign or retire voluntarily during a period
     designated by the agency;

o    Be serving under an appointment without a time limit. 
     (Employees under appointments having a noncompetitive
     conversion eligibility to a career or career-conditional
     appointment after a set period, e.g., a VRA or Presidential
     Management Intern, are covered); 

o    Have been continuously employed in Federal service for at
     least 12 months without a break of a single day as of the
     projected date of separation with an Incentive (paid leave
     and nonpay status are creditable);

o    Not be a reemployed annuitant; and

o    Not be eligible for disability retirement.

Incentives are used with any type of voluntary separation--
resignation, regular optional retirement, or voluntary early
retirement (but not disability retirement).  Eligibility
requirements for retirements based on voluntary separations can be
found in the CSRS and FERS Handbook for Personnel and Payroll
Offices (formerly FPM Supplement 830-1).

Employees who take an Incentive are not eligible for the
Alternative Form of Annuity (lump-sum payment with reduced
annuity).  Employees who are involuntarily separated and take a
discontinued service retirement, or who retire under the mandatory
retirement provisions of the retirement law, are not eligible for
an Incentive.  

Employees on leave without pay or on detail give up any
reemployment or restoration right they may have in exchange for an
Incentive, for example, employees on detail to an international
organization.  Employees receiving injury compensation while on
leave without pay (LWOP) also may accept an Incentive and
relinquish a reemployment right (such individuals are not
automatically eligible for disability retirement).  An employee
separated with a reemployment or restoration right is not eligible
for an Incentive because the law requires persons to be currently
employed by the agency offering the Incentive.

If reemployed within 5 years, an employee must pay back the full
Incentive unless OPM or another designated official waives it. 
(See "Special Factors for Employees to Consider" in this Guide.)
F.  Planning for Effective Use of Incentives

Incentives provide a quick and effective method to reduce payroll
costs.  Because of their voluntary nature, they also are less
stressful for employees than a reduction in force.  However,
careful planning is necessary to assure that Incentive programs do
not have an adverse impact on an agency's financial situation or
ability to carry out essential functions.    

Working within partnerships and negotiating, as appropriate, are
important aspects of the planning process.

Planning includes these steps: 

(1)  Set specific targets for position and dollar/staff year
savings to be achieved.  

(2)  Estimate the number of employees who will take Incentive
offers.

(3)  Determine timing of offers and window period.

(4)  Determine coverage of Incentive offers.

(5)  Give employees information.

This guide discusses these steps.

G.  Setting Targets
 
Set specific targets for position and dollar/staff year savings to
be achieved.  Take into account the number and amount of Incentives
the agency can offer, and its funding and employment levels. 
Incentives are targeted at positions in locations, organizations,
and/or occupations, but may not be targeted at individuals.

A key problem is how to avoid offering more separation Incentives
than an agency can afford, both in terms of money and in terms of
lost talent.  It is, therefore, critical, for agencies to establish
specific targets for groups of positions with dollar and staff year
savings to be achieved.  Opening an offer to the first 200 takers
of all types might result in losing the right numbers but the wrong
employees in terms of the agency's mission.  Alternatives include
offering Incentives to specific occupations, components, grades,
etc., possibly at staggered intervals.  At the same time, an agency
does not want to be so restrictive in its offers that an
insufficient number of employees accept them. 

These targets will facilitate internal monitoring of Incentives
once they have been offered.  Setting targets will also enable the
agency to make necessary adjustments in the program while offers
are underway.


H.  Projecting Separations

An important aspect of determining coverage for Incentive offers is
to estimate how many who are eligible will take them.  One approach
is to survey employees in advance for non-binding (perhaps
anonymous) indications of interest.  Another approach is to look at
the experience of agencies that already have used separation
Incentives.  Their experience can help other agencies project
separation rates.  Generally, Incentives have been more attractive
to lower and mid-graded workers than to higher-graded employees.

The following shows the percent of DOD and GAO employees who
retired with Incentives from among those who were eligible for
voluntary early and regular optional retirement and the percent of
non-retirement eligibles who accepted Incentives and resigned:

          Early Retire.  Optional Retire.    Resignation

DOD       32%            53%                 2%
GAO       16%            52%                 not available

I.  Timing

Timing is very important because almost all of the savings from
voluntary reductions come in the years following the year in which
the buyouts are paid.   

The break-even date, the last date in a fiscal year on which
savings offset separation costs, varies by pay level, length of
service, retirement system, and other factors.  (However, an agency
may be able to afford separation Incentives after a break-even date
if it has other available funds.) 

For example, the financial break-even date for a GS-14's early
retirement, with an Incentive, might be in April.  For a GS-7,
however, it is more likely to have been the previous November (the
second month of the fiscal year). The difference is because the
maximum buyout is $25,000, an amount representing almost a full
year's pay at GS-7, but only four month's pay at GS-14.    

The key financial factors are:

o    Savings in Pay and Benefits.  In addition to salary,
     agencies typically pay 30% of pay for the benefits of
     employees in the Federal Employees Retirement System and
     around 14% for those in the Civil Service Retirement System.
 
o    Payment for annual leave balance. For most retirees, figure
     the equivalent of six weeks' pay.  This assumes the retirees
     have the 240-hour annual leave maximum that can be carried
     over into a new leave year. Some members of the Senior
     Executive Service actually have more than a year of unused
     annual leave, since they have no limit on what they can
     carry over from year to year. 
     For resignations, figure on a lower annual leave balance. It
     should be possible to come up with good estimates from
     agency leave records.

o    Dates for Paying Incentives.  Incentives are paid as a lump
     sum in the year of separation.  Severance pay is paid over
     time, at the same rate as salary, so it can extend into the
     next fiscal year.
     
o    Payment of 9% to Civil Service Retirement Fund.  For CSRS
     early retirees who accept a buyout, agencies pay 9% of the
     employees' final basic pay into the retirement fund.  Since
     this payment does not apply to regular optional retirees,
     the break-even point for them would be later in the fiscal
     year than for early retirees.  Final basic pay means the
     total amount of basic pay that would be payable to an
     employee for a year of service, computed using an employee's
     final rate of basic pay, with adjustments for less than a
     full-time work schedule. 

Example:
     A GS-14, step 10, with 27 years of service, earning
     Washington, DC locality pay ($76,733), takes early
     retirement with an Incentive on March 31, 1994.

     Incentive Payment                  ($25,000)
     Lump Sum Leave (240 hrs)           ($ 8,824)
     9% to CSRS                         ($ 6,906)
                                        _______

     Cost to Agency for FY 94           ($40,370) 

     Salary & Benefits Saved             $43,354 
     (April through September)
                                         ________
     NET SAVINGS FOR FY 94:              $ 2,624 

This example shows savings from separation on a particular date. 
What if the agency wants to know the latest date this same GS-14
could retire before costs would exceed savings?

To calculate a break-even date, determine how long someone must be
off the payroll for payroll savings to equal the costs of
separation.  In the example, the cost of separation is $40,370,
which is the equivalent of about 24 weeks' salary and benefits. 
This means the agency would need the GS-14 to separate by
mid-April--24 weeks before the end of the fiscal year.

To calculate an agencywide break-even date, an agency would use
average costs.

J.  Setting the Incentive Window

After determining its break-even point, an agency needs to set a
time period in which Incentives will be offered.  This window may
be at any time and for any period as long as employees separate no
later than March 31, 1995. (An agency may make an exception and
allow an employee to remain up through March 31, 1997; see
"Employee Separation Dates" in this guide.)  An agency may close
the window early if its reduction goal has been met.  

An agency may set a window to occur at different times for
different categories of positions in the agency.  While the
greatest savings to an agency would accrue with separations as
early as possible in a fiscal year, an agency may have reasons for
delaying or staggering the windows, for example, planning needs,
adequate time to advise employees, completion of an essential
agency function, etc. 

K.  Determining Coverage of Incentive Offers

An important decision an agency makes is how to control Incentive
offers because these offers determine who will leave the agency. 
Unlike other workforce reduction techniques such as attrition or
reduction in force, which often result in skill imbalances and the
need for extensive retraining, agencies can more precisely target
and control Incentive offers.

Incentives need not be limited to positions the agency intends to
abolish.  Properly managed, Incentives can be used to create
vacancies in jobs the agency will have to refill.  These vacancies
can be used to place surplus employees from other parts of the
organization.  It makes no sense, however, to offer Incentives to
employees in critical jobs that cannot be refilled with surplus
employees.

The agency head or designee has considerable discretion to tailor
the use of Incentives to meet restructuring goals.  (The agency
head may delegate authority to other agency officials to make these
decisions for various agency components.)  The agency may offer
Incentives to all eligible employees of the agency or only to
employees in designated:

     -    organizational units,

     -    geographic locations, 

     -    occupational categories (including grade levels), or

     -    any combination of these factors,

but may not select individual employees on a personal basis to
receive Incentives.  

If an agency offers voluntary early retirement in conjunction with
Incentives, it needs to look at the impact of retirement
eligibility in determining coverage.  An employee who wishes to
retire must meet the requirements for retirement on the separation
date, whether this is during the Incentives window or at a delayed
date.  (See "Employee Separation Dates" in this Guide.)  Thus, in
determining coverage, an agency will need to have a policy on
whether to accept applications from pre-retirement eligibles who
will have a delayed separation date, but meet retirement
eligibility when separated.  OPM will allow an employee to take an
early retirement when separated with an Incentive, if the employee
otherwise is covered by the early retirement authority.

Agencies should be aware they have authority, if they choose to
use it, to release employees from certain service agreements where
the agency has paid benefits such as training, relocation costs,
recruitment bonuses, etc.  Generally, the regulations covering
these benefits discuss waiver authority.  

An agency may not coerce an employee to separate with an Incentive
or deny an employee an Incentive based on a factor not authorized
by P.L. 103-  .

L.  Criteria to Consider in Determining Coverage

To determine the positions, locations, and/or organizational units
to cover, agencies should consider:

o    The recommendations of the National Performance Review (NPR)
     to reduce supervisory layers and take other actions to       
     improve productivity.

o    Which positions in a particular organization or occupation
     are critical to accomplishing the agency's mission and
     whether they would continue.

o    Whether replacing employees in positions in certain
     geographic and organizational locations would be difficult
     or costly. 

o    Whether the resulting vacancies would provide an opportunity
     for placement of other employees in surplus positions.

o    Whether reassigned employees would be capable of assuming
     the duties of vacated positions without significant loss of
     productivity or the need for extensive retraining.

o    Whether the organization can afford the overall loss of
     experience and the resulting adverse effect on mission
     accomplishment that would result from losing employees in
     certain occupational series and grade levels or
     organizational/program components.

o    The results of surveys or other agency acceptance rates (see
     "Projecting Separations" in this Guide).



Examples of the kinds of jobs excluded by agencies that have
offered Incentives:

o    Jobs with particular skill requirements that may make them
     difficult to refill from within the agency;

o    Positions that may require extensive relocation costs to
     refill (e.g., essential positions in overseas areas); and

o    Jobs in high-cost metropolitan areas where it may be
     difficult to replace employees who have retired.

M.  Giving Employees Information

Just as agencies need information to make sound choices, employees
will be reluctant to decide to separate without full information.
Agencies can improve results by giving employees as much
information as possible as early as possible.  The Q&A's at
the end of this Guide may be helpful.  The CSRS and FERS Handbook
for Personnel and Payroll Offices (formerly FPM Supplement 830-1)
contains detailed information on the eligibility requirements for
and computation of retirement benefits.

N.  Processing Applications

Once an agency has announced Incentive offers, it should accept
requests from all eligible employees.  The agency may not select
employees on a personal basis to receive offers. 

Incentives are not employee entitlements.  Therefore, agencies are
not obligated to honor all employee applications, as long as there
is a fair and objective basis used to make such decisions, and
employees are advised of this when they are invited to submit
applications.  

Fair and objective application procedures are one of the most
important elements of any Incentives program.  Because of their
high visibility, these procedures are one of the key standards by
which the effectiveness of an agency program will be judged.

Two possible methods for approving applications are order of
receipt of application or order of separation date with the
earliest dates accepted first.  Regardless of the method used, it
is best to tell employees of it in advance since it is a condition
of approval.  Because some employees may wait until the latest date
possible to apply, the agency will want to be sure its method
covers these eventualities.

An agency can lessen the possibility of last minute applications
by sending frequent, periodic reminders to employees about the
Incentive offer and continuing to offer guidance.  Approving
applications on a first-come basis, or by the earliest separation
dates, also can help.  It is wise to emphasize to employees that
the agency will close the window early if it meets its reduction
goal prior to the end of the window.  Periodically, the agency
might want to tell employees how many applications it has approved. 
Finally, the agency may need special policies for approving
applications on the last day of the window--especially if
applications are accepted at more than one location.  For example,
this might include --

     - setting the deadline as noon on the last day, 

     - requiring that last day applications be delivered to a
     particular person, 

     - not approving any delayed separation dates for last day
     applications, 

     - using service computation date, or some other
     predetermined fair and objective method, to choose among an
     excess number of applications on the last day of the window,

     - setting up a hotline for applicants to call after normal
     business hours to learn whether their application was
     approved, and

     - publicizing these procedures to all employees at a date
     close to the end of the window. 

O.  Employee Separation Dates

To receive an Incentive, employees generally must be off the rolls
before April 1, 1995.  However, when an employee's services will be
needed temporarily to ensure the performance of the agency's
mission, an agency head may approve an exception to require the
employee to complete an additional period of service ending no
later than March 31, 1997.  To receive an Incentive, the employee
must complete the additional period of service required.  An agency
may not approve an exception solely for the employee's convenience
or solely to enable an employee to reach retirement eligibility.

Agencies may make exceptions to delay the separation date for
individual positions or by categories of positions.  Whenever
possible, the general offer letter announcing Incentives should
state which positions/occupations may have delayed separation dates
since the proposed separation date could have a significant bearing
on an employee's decision.  

Agencies generally offer voluntary early retirement in conjunction
with Incentives.  Normally, the window for early retirement
coincides with the window for Incentives.  Where an agency approves
an exception to retain an employee beyond the Incentives window,
OPM will allow the employee to take an early retirement when
separated with an Incentive, if the employee otherwise is covered
by the early retirement authority at the time of the Incentives
window and meets the criteria for early retirement at the time of
separation.  If the employee does not meet the criteria for early
retirement during the window period, he or she must meet it when
separated with an Incentive.

An employee who has agreed to a delayed separation date with an
Incentive is not exempt from separation because of reduction in
force, performance reasons, or conduct reasons prior to that
agreed-upon date.  An agency may not change a permanent employee
to a time-limited appointment on the basis of the employee's
agreement to a delayed separation date with an Incentive
(employees under time-limited appointments are not eligible to
receive an Incentive).  

An agency needs to decide whether to use a not-to-exceed (NTE) date
or a specific date for delayed separations.  To enable employees to
make informed decisions, an agency would be wise to give complete
information to employees on the policies it adopts.  The following
are examples of situations an agency might encounter and possible
policies it might adopt (in developing its Incentives program) to
deal with these situations:  

-    Traditionally, the use of an NTE date means an agency, at
     its discretion, may separate an employee at any time up to
     the NTE date.  Such an early separation would be processed
     as a resignation or retirement with an Incentive, in
     accordance with the agreement the employee signed--even if
     the employee does not want to leave early.
  
-    If an agency needed to conduct a reduction in force (RIF)
     prior to an NTE date, it might separate an employee (with
     Incentive) prior to the RIF or let the employee choose
     whether to separate with Incentive prior to the RIF or stay
     and compete in the RIF.  If an employee competes but is not
     separated in the RIF, he or she would be separated later
     with an Incentive in accordance with their agreement.
  
-    If an agency gave an employee a specific separation date but
     needed to conduct a RIF prior to that date, it might let the
     employee choose to separate (with Incentive) prior to the
     RIF.  Otherwise, the employee would compete in the RIF.  If
     not separated in the RIF, he or she would be separated later
     with an Incentive on the specific date in accordance with
     their agreement.

-    Once an employee has agreed to an NTE date or specific date,
     an agency might extend the date further, with the employee's
     concurrence, but not later than March 31, 1997.  

-    An agency would separate an employee only on an agreed-upon
     specific date, unless the employee agreed to a new date.

While the delayed separation date gives an agency flexibility,
the potential for complications is great.  Among the factors to
consider in delaying a separation date are the following:

-    A high number of exceptions and long delays in separations
     may reduce an agency's ability to meet its anticipated
     reduction goal by a particular date.  It might have to
     increase the projected number of voluntary separations to
     achieve the same savings it would realize from requiring all
     separations to occur during the window.  

-    There is the possibility that employees may attempt to
     withdraw their resignations or retirements before the
     effective date, even though they have agreed to a separation
     date.  To avoid the disruption to the agency's ability to
     meet its reduction goal, the agency should offer the
     Incentive in the form of an agreement.  The agreement
     language would state that in return for the benefit of
     receiving a separation incentive, the employee agrees to
     resign (or retire) during the window period or at a later
     date designated by the agency.  The agreement should also
     contain language that the employee has freely and
     knowledgeably entered the agreement.  Preferably, both the
     employee and an agency official would sign the agreement.  

     A decision by the Merit Systems Protection Board, (MSPB),
     McClain v. U.S. Postal Service, 40 M.S.P.R. 66 (1989) held
     that a signed and executed settlement agreement constituted
     the employee's resignation from the agency.  Unless the
     agency offers the separation incentive in agreement form,
     third parties have held that employees may later withdraw
     their agreed-upon resignations or retirements before they
     are effected unless the agency can demonstrate that such a
     withdrawal would cause undue disruption to the agency's
     mission.  Although the agency would likely prevail if the
     employee later challenged the separation as involuntary, it
     is preferable to avoid the possibility of appeals by the
     offer of Incentives as voluntarily entered agreements.

P.  Personnel Office Functions

In addition to its participation in agency decisions on the open
window period, coverage, and other policy aspects of Incentives,
the personnel office plays a major role in seeing that the program
succeeds.  

Agencies negotiate or consult, as appropriate, with unions
representing affected employees. 

Agencies must give employees complete information and keep them
informed.  Initially, many agencies send a general memorandum to
all employees notifying them of the availability of Incentives, how
requests will be handled, and the positions excluded from
eligibility.  The memo usually provides a personnel office or other
contact point where employees can pick up the information and forms
they will need, and may also announce a group session to discuss
the offers and related matters.  Employees who are still interested
can be given the opportunity for personal counseling and, if
eligible for retirement, an annuity computation by personnel office
staff.  Some agencies also send individual letters to those
eligible for voluntary early retirement to provide them with
similar information.  An agency may want to consider the use of a
hotline to respond to employee inquiries.

Once applications for Incentives have been accepted, the personnel
and payroll offices will need adequate time to process the
Incentives, retirements, and resignations.  The proper and speedy
processing of retirement applications is always a serious concern
of retiring employees, and it becomes even more so in a situation
where large numbers have retired.  Thus, agencies should provide
for adequate staff to assure that applications and supporting
documentation are quickly processed and sent to OPM.

Q.  Special Factors for Employees to Consider

Agencies must insure employees understand that their decision to
leave with an Incentive is entirely voluntary.  Employees may not
be coerced to resign or retire.

Agencies paying Incentives under P.L. 103-   should include in
their applications for Incentives a statement telling employees
they must repay the full Incentive if employed in the Federal
government under any type of appointment or under a personal
services contract within 5 years after separation with an
Incentive.  The head of an agency may request that repayment be
waived for an individual who has unique abilities, is the only
qualified applicant available for the position, and will be
employed under Federal appointment.  This waiver authority rests
with OPM for employment in executive agencies, with the Director of
the Administrative Office of the U. S. Courts for judicial branch
positions, and the head of the organization or appointing official
for a legislative branch position.  Repayment for employment under
a personal services contract may NOT be waived.

DOD and CIA employees were not previously subject to this repayment
requirement.  However, under P.L. 103-   , the above repayment and
waiver provisions apply to DOD and CIA employees separating with
Incentives on and after the date of enactment of P.L. 103-  .   

Employees should be advised that since voluntary early retirement
is considered voluntary, any subsequent reemployment with the
Federal Government can occur only as a reemployed annuitant.  Also,
an individual who accepts an Incentive is not eligible for any
programs aimed at employees who are involuntarily separated, such
as placement assistance programs for displaced employees.

A primary consideration for employees in deciding whether to choose
early retirement is the reduction for age in annuities under CSRS. 
A basic annuity is reduced by 2% for each year (1/6 of 1 percent
for each full month) an employee is under age 55 at the time of
retirement.  Under FERS there is no age reduction for voluntary
early retirement but if an employee who elected FERS is entitled to
a CSRS component, the CSRS component will be reduced using the CSRS
rules.  An employee under FERS who is not eligible for voluntary
early retirement is eligible for an immediate annuity if he or she
has 10 years of service and has reached the minimum retirement age
(55 if born before 1948, and gradually increasing to 57).  This
type of benefit is referred to as "MRA+10" and is subject to an age
reduction if the employee is under 62.

An employee who has decided to retire should consider the effective
date of annuities.  For employees who retire voluntarily under CSRS
after the third of the month, their annuity does not begin until
the first of the next month.  Most CSRS employees thus want to
retire by the third of the month.  Under FERS, all voluntary
retirements begin on the first of the month after separation,
except that an "MRA+10" benefit may be delayed to age 62, at the
retiree's option.

Employees also should be cautioned that to carry over health and
life insurance into retirement, an employee must have been enrolled
in the programs for at least 5 years prior to retirement, or since
their first opportunity to enroll.  (The recent life insurance open
season does not constitute a "first opportunity" that would allow
those who did not meet the 5-year requirement to carry life
insurance coverage into retirement.)

To inform employees, agencies may want to use the Q&A's at the
end of this Guide.

R.  Documenting Personnel Actions

The SF 50, Notification of Personnel Action, documenting an
employee's separation is used to record receipt of an Incentive. 
Use blocks 5A-F to document the employee's resignation or
retirement.

o    For voluntary early retirements, use NOA "303 Retirement-
     Special Option."

o    For CSRS employees, use Authority Codes "VYJ/5 U.S.C.
     8336(d)(2) RIF" and "AZM/CSP, VERA No. and date."  

o    For FERS employees, use Authority Codes "USM/P.L. 99-
     335" and "AZM/CSP, VERA No. and date."

o    For regular optional retirements, follow the instructions in
     chapter 30 of The Guide to Processing Personnel Actions.

o    For resignations, see chapter 31 of the Guide to Processing
     Personnel Actions. 

Use blocks 6A-D of the same SF 50 to record receipt of the
Incentive.  Use NOA "825 Separation Incentive" and Authority Code
"Z2R/P.L. 103-   ."  Enter the amount of the Incentive in block 20
and leave blocks 16-19 and 21 blank. 
S.  Reporting Results to OPM

P.L. 103-   requires OPM to report to Congress on agency use of
Incentives.  OPM also requires agencies to report on their use of
voluntary early retirement authority.  OPM has developed a
consolidated reporting form for both programs.  See Attachment 4
for the format and report due dates.  

[BBS Note-Attachment 2 continues on next page.]













































Attachment 2-continued

Agencies should tailor these sample questions to fit agency
circumstances.  The goal is to give employees enough specific
information for them to make informed decisions.

                                
                      Questions and Answers
                               on
            Voluntary Separation Incentive Payments 
      under the Federal Workforce Restructuring Act of 1994
                          P.L. 103-    

1.  What are Voluntary Separation Incentive Payments?  Why are
Federal agencies offering them?

Agencies are offering the incentive payments to employees who
resign or retire.  The Administration is committed to reducing the
size of the Federal workforce.  If employees voluntarily leave
Federal service, there will be less need for reductions in force. 

2.  Does the new law change eligibility for retirement?

No.  If you are under FERS or CSRS, you can take regular optional
retirement if you are 55 with at least 30 years of service; age 60
with 20 years of service; or age 62 with 5 years.  If your agency
offers early retirement, you must be at least 50 with 20 years of
service or have 25 years of service at any age.  An employee under
FERS also is eligible for an immediate annuity if he/she has 10
years of service and has reached the minimum retirement age (55 if
born before 1948, and gradually increasing to 57).  An employee
under CSRS must meet the 1-out-of-last-2 years coverage requirement
and all employees must have at least 5 years of civilian service.

3.  Who is eligible to apply for an incentive payment under the new
law?

Employees are eligible if they voluntarily resign or retire under
conditions established by their agency and meet other requirements
in P.L. 103-  .  You can apply if you: 

o    have 12 months of continuous service, 

o    are not eligible for disability retirement,
     
o    are not a reemployed annuitant, 
     
o    have an appointment without a time limit, and
     
o    are not in a position your agency has excluded.

4.  What does an "appointment without time limitation" mean?

An employee on an appointment with a time limit works only until a
specified date and then goes off the rolls.  The employing agency
sets the ending date when it hires the individual and/or when it
extends the appointment.  For example, temporary and term employees
serve with a time limit, so they are not eligible for an incentive
payment.  Career and career-conditional employees and permanent
employees in the excepted service have no limit so they are
eligible.   

5.  What does "continuous service" mean?

To be eligible for an incentive payment, you must have 12 months of
continuous service with no breaks.  Going off the rolls for even 1
day is a break in service and would disqualify you for an incentive
payment.
           
6.  I retired from the military but am now a civilian employee. 
Can I apply for a separation incentive?

Yes, if you are otherwise eligible.  The agency will figure the
incentive payment only on the basis of your civilian service.

7.  When is the earliest I can leave with an incentive payment? 
When is the latest?

This agency has set a window from (insert date) to (insert date). 
The agency may also delay your separation with an incentive payment
to no later than March 31, 1997, if your job is essential for
continuing operations.  (See questions 16-18.)

8.  If I meet all the requirements, do I automatically get an
incentive payment if I leave?   What if my agency gets more
requests for incentive payments than are necessary to meet its
reduced staffing targets.  How will it decide which requests to
approve?  

You are eligible to apply for an incentive payment if you meet all
the requirements set by the law and your agency.  Agencies may
exclude certain jobs or units from the incentive payment offer. 
(See this agency's list attached.)  In handling applications, the
agency must use a fair and objective method to determine the order
in which applications will be approved.  This agency will make
decisions in the following way:  (describe method)

9.  How much will I get if I take an incentive payment?

An incentive payment is the amount of severance pay you would get,
or $25,000, whichever is less.  Severance pay is figured as if you
would get it; you don't have to be eligible for severance pay. 
(Severance pay is normally only for people who separate
involuntarily.  Leaving Federal service with an incentive payment
is a voluntary action.)  

The amount of severance pay would be 1 week's basic pay for each of
the first 10 years of your civilian service, plus 2 weeks' basic
pay for each year over 10 years.  An age adjustment allowance of
10% is added for each year you are over 40.  (No credit is given
for military service unless the service interrupted otherwise
creditable civilian service.)

10.  When will I receive my incentive payment?  Will it be all at
once (lump sum) or monthly?  Is it taxable?

The agency will send you the incentive payment as soon as possible
after the date of your separation, but cannot guarantee a specific
date.  First, the agency must resolve any leave errors, salary
offsets, and employee debts to the Government.  It is also subject
to garnishment for alimony and child support.  The incentive
payment is taxable.  You will receive it as a lump sum (less
Federal income tax withholding, applicable State and local taxes,
and FICA/Medicare taxes).  

11.  Do I have to make a commitment to leave if I accept an
incentive payment?

Yes.  Your agency will ask you to sign an agreement saying that in
exchange for an incentive payment you agree to resign or retire on
a specific date.  If employees could change their minds, the agency
might not be able to meet its downsizing goal.

12.  What does the incentive payment agreement say?

The agreement says that you agree to leave by a certain date in
return for the incentive payment.  It also says that if you accept
an incentive payment, you will not be eligible for reemployment
with the Federal government, in either a temporary or permanent
status, for 5 years following the effective date of your
separation--unless you repay the full amount of the incentive
payment.  This requirement applies to personal services contracts
also.  Waivers are allowed only in rare cases.

13.  What rights and benefits would I be giving up to take an
incentive payment to retire or resign rather than a RIF separation?

Placement assistance:

o    Taking a job in Government within next 5 years without
     paying back the incentive payment;
     
o    Full amount of severance pay (if eligible);
    
o    Discontinued Service Retirement (if eligible); and the
     option of a lump-sum refund of retirement contributions
     (available to employees separated involuntarily through
     September 29, 1994).

14.  May I take a Discontinued Service Retirement, the lump-sum
refund of retirement contributions, and an incentive payment?

No.  Incentives are paid to employees who leave voluntarily.  The
lump-sum refund is available only to employees who have a critical
medical condition or are separated involuntarily no later than
September 29, 1994.  Discontinued Service Retirement is based on an
involuntary separation. 

15.  If I leave with an incentive payment, can I take a job in
another Federal agency?  Am I eligible for placement assistance?

If you retire or resign with an incentive payment, you may not take
a job with the Federal government for 5 years following the day of
your separation--unless you pay back the full amount of the
incentive payment.  This prohibition covers any kind of employment
(for example, permanent, temporary, expert, consultant, reemployed
annuitant) as well as personal services contracts.  Repayment may
be waived, but only in those rare cases where an individual is the
only qualified applicant for a job and the agency head requests the
waiver from OPM.  If OPM waives the repayment and you are
reemployed, you may not move out of that position--unless you repay
the incentive payment or unless OPM approves another waiver.

You are not entitled to placement assistance because employees
volunteer to leave Federal service with an incentive payment. 
Placement assistance is for employees who are involuntarily
separated. 

16.  Can the agency delay my separation until after the "window"
and still give me an incentive payment when I leave?

Generally, to receive an incentive payment, the effective date of
your resignation or retirement must be during the agency's window
period.  However, the agency may extend individuals in certain
positions or whole groups of positions for any period up through
March 31, 1997, to continue essential operations.  

17.  How will the agency decide which employees to delay?

(insert agency's own description of jobs/categories for which
separation will be delayed)
     
18.  Can I turn down my agency's request that I stay on for an
additional period and leave now and still get the incentive
payment?
     
Agencies may approve the incentive payment for certain employees
contingent on their staying to finish essential activities.  If you
are such an employee, you could still resign at any time, or take
early retirement during the early retirement window, or take
regular retirement if you are eligible, but you would not get the
incentive payment if you left before the date the agency set.   

19.  Leaving Federal service with the incentive payment is supposed
to be voluntary.  If I'm eligible but don't choose to leave, can my
agency retaliate by moving me to another position? 
Incentives are for voluntary separations.  Coercion is prohibited. 
However, after the window closes, an agency may find it necessary
to move some remaining employees to other positions.  Also, later
restructuring could mean the agency would have to reassign or even
separate employees.  To take these actions agencies would have to
follow requirements of law, regulation, and applicable negotiated
procedures.

Early Retirement

20.  Who is eligible for early retirement?

OPM has authorized the agency to offer early retirement to eligible
employees.  The agency has excluded employees in certain jobs that
are critical to the agency's operation.  (See list attached.)  The
agency may change this list before the early retirement window
closes. Unless you are excluded because your job is on the above
list, you are eligible for early retirement as follows:

o    If you are under the Civil Service Retirement System (CSRS),
     you must have served in a position covered by the CSRS for
     at least l year out of the 2 years immediately before
     retirement.   If you are under FERS, this rule does not
     apply.  At least 5 years must be civilian service, whether
     you are retiring under CSRS or FERS.

o    You must be at least 50 with 20 years of service or have 25
     years of service at any age.  

o    You must be serving under other than a temporary
     appointment;

o    You must have been on the agency's rolls as of (insert date)
     and you served continuously since that date without a break
     in service.

21.  What does the early retirement "window" mean?

Each agency sets a window, or period of time, during which eligible
employees can take early retirement.  Normally, this coincides with
the window during which buyouts will be offered.  If you want to
retire early, you would separate during this time period, in other
words, from (insert date) and no later than (insert date).  You
must turn in your application as soon as possible to make sure you
can retire during the window.  If your agency offers you an
incentive payment contingent on your staying beyond the window to
finish essential work, you do not have to retire during the window,
but you must apply during the window period.

22.  Can anyone who is eligible and who applies for early
retirement be assured of retiring early?

Just as it does with buyouts, the agency may set a limit on the
number of early retirements it offers. (The agency must pay the
retirement fund 9% of the final salary of each employee who retires
early under CSRS.)   This number should take care of all the
employees who want to retire early and whose jobs are not essential
to the agency's continued operations.  If the agency receives more
applications than it needs, the agency must use a fair objective
method to make decisions, for example, order of separation date,
order of receipt of completed applications, seniority, etc.). 
(describe method agency will use)

23.  If I take early retirement, is my annuity reduced?

CSRS employees who retire under the voluntary early retirement
authority will have a reduction in their annuity of 2 percent per
year for each year they are under age 55.  (The reduction is 1/6 of
1 percent for each full month.)  This is a permanent reduction in
annuity.

Employees with only FERS service will not have their annuities
reduced unless retiring under the MRA+10 provision before age 62. 
Employees with both CSRS and FERS service will have a reduction
only for the CSRS portion of their service.

Special rules apply to the calculation of annuities of employees
who have part-time service after 1986.  The personnel office can
give you more details.

24.  If I take early retirement, what happens to my unused sick
leave?

CSRS employees will receive service credit for any unused sick
leave in determining their annuity (but they must meet eligibility
requirements for retirement before the sick leave is added.)  

FERS employees do not receive credit.  Employees who were
previously under CSRS but who transferred to FERS will receive
credit for either the amount of sick leave at the time of the
transfer to FERS, or at the time of retirement--whichever is less. 

25.  Can I continue health and life insurance into retirement?

If you retire on an immediate annuity and if you have been enrolled
(or covered as a family member) in a plan (not necessarily the same
plan) under the Federal Employees Health Benefits program from (a)
the 5 years of service immediately preceding retirement, or (b)
from service since your first opportunity to enroll, or (c)
continuously for the full period or periods of service beginning
with the enrollment which became effective no later than December
31, 1964.  Also, your annuity must be sufficient to cover your
share of the premiums.

26.  What forms do I need to apply for early retirement with an
incentive payment and where do I get them?

The personnel office (insert room number, phone number, and staff
names) has the materials ready.  You will sign:  (1) an application
for retirement (2) an incentive payment agreement.


[BBS Note-Attachment 2 continues on next page.]

















































Attachment 2-continued

                   ELEMENTS OF A MODEL PROGRAM

Some tips on carrying out a smooth and efficient program:

     -    Carefully plan and prepare.  Involve unions early in
          the process.  Prepare personnel office to handle
          increased workload.

          o    Determine agency components/occupations/grades
               affected by downsizing and reduction targets.

          o    Project costs and savings and determine number of
               Incentives to be offered.

          o    Identify employees eligible for optional and
               voluntary early retirements.

          o    Survey employee interest in buy outs.

          o    Establish management procedure for approving
               extensions of separation dates past the end of the
               Incentive period.

          o    Set a time line for the window.

          o    Decide on policies/procedures for people who
               change their minds about leaving.

          o    Involve payroll and develop expedited payment
               procedures.

     
     -    Provide employees with plenty of information--and keep
          it current.

          o    Especially important:

               -  What their annuity computation will be.
               -  When Incentives will be available.
               -  Who is eligible.
               -  What conditions are attached.
               -  When employees may expect payment.

          o    Set up an employee hotline number.  This will give
               employees one-stop shopping for answers about the
               program.

          o    Have extensive benefits counseling available to
               employees and spouses.

[BBS Note-Attachment 3 begins on next page.]

Attachment 3
            

             Voluntary Separation Incentive Payments

               o  Sample Documents for Agency Use

                              U.S. OFFICE OF PERSONNEL MANAGEMENT
                           Federal Workforce Restructuring Office
                                                       March 1994

These samples may help agencies prepare for using voluntary
separation incentive payments:

Sample 1:   Letter Announcing Incentive Program to Employees 

Sample 1A:  Enclosure:   Positions Designated for Exclusion or
Extension  

Sample 2A:  Application to Resign with VSIP 

Sample 2B:  Application to Retire with VSIP 

Sample 3:  Voluntary Separation Incentive Payment Resignation
Survey  

Sample 4:  Voluntary Separation Incentive Payment Retirement Survey

Sample 5:  Memo from Agency to Extend Employee Beyond Closure Date
of Incentive Window  

Sample 6:  Employee Acceptance of Agency Incentive Offer with
Extended Separation Date  

Sample 7:  Employee Declination of Agency Incentive Offer with
Extended Separation Date 


[BBS Note-Attachment 3 continues on next page.]















SAMPLE 1


        LETTER ANNOUNCING INCENTIVE PROGRAM TO EMPLOYEES


MEMORANDUM FOR ALL EMPLOYEES

Subject:  VOLUNTARY SEPARATION INCENTIVE PAYMENTS

This memorandum announces an opportunity for employees to apply for
voluntary separation incentive payments.


New Legislation

Under the Federal Workforce Restructuring Act of 1994  (P.L. 103- 
  ), agencies are authorized to offer separation incentive payments
to regular and early retirees and employees who resign.  In
conjunction with this law, the U.S. Office of Personnel Management
has approved a voluntary early retirement authority for this
agency.   These programs are intended to assist in the reduction of
the size of the Federal workforce while avoiding involuntary
separations through reductions in force (RIF).

Our Agency's Program

We will authorize payments of voluntary separation incentives to a
maximum of (insert number) eligible employees who leave the agency
during (insert dates of window).  The special incentive will be
paid on the following basis: (insert description of fair and
objective method the agency will use to determine the order
in which applications will be approved.)

Eligibility

You are eligible to apply for a separation incentive payment if:

1.   You serve under other than a time limited appointment;

2.   You occupy a position or occupation which has not been
excluded from eligibility by this agency (see Enclosure);

3.   You separate from the Federal service by resignation, early
retirement, or regular retirement (except disability retirement) no
later than the end of the window period which
          will begin on (insert date) and end on (insert date).  If
necessary, this agency can delay separations of employees receiving
incentive payments up to March 31, 1997, to ensure the performance
of the agency's mission (see Enclosure);

4.   By the time you separate, you must have been continuously
employed in the Federal government for at least 12 months.  Early
retirement eligibles must also have been continuously on the rolls
of this agency from (insert date). 

Amount of Payment

The amount of the separation incentive payment is not
discretionary.  It is an amount equal to the employee's calculated
severance pay entitlement or $25,000, whichever is less. 
Separation incentive payments are based upon the standard severance
pay calculation.  However, incentive payments are limited, by law,
not to exceed $25,000.  Severance pay equals one week basic pay for
each of the first ten years of creditable federal service plus two
weeks of basic pay for each year of creditable service over 10
years.  In addition, an age factor applies which increases the
amount by 10% for every year your age exceeds 40 years.

Separation Agreements

Employees who apply for separation incentive payments must sign an
agreement that the decision to resign or retire under these
circumstances is entirely voluntary and that they agree to repay
the incentive if they are reemployed by, or enter into a personal
service contract with, the Federal government within 5 years of the
date of the separation on which the separation pay is based.  If an
employee is selected to receive the voluntary separation incentive
payment, these agreements will serve as a commitment to resign or
retire during the window period.  If employees are not selected to
receive a separation incentive, they will not be bound by this
commitment.

Delayed Separation for Employees in Critical Positions

Decisions on delaying the separation of employees for an additional
period after the end of the incentive "window" are at the
discretion of the agency and may be affected by changes in workload
and mission requirements.  Positions covered by a delayed
separation are listed in the Enclosure.  If you are selected for a
delayed departure, your eligibility for retirement and the amount
of the incentive you receive will be based on your salary and
retirement eligibility as of the date you actually leave the
agency.

Restrictions on Reemployment

Employees who accept incentive payments have restrictions placed on
future employment with the Federal Government.  An employee who
accepts separation incentive pay may not accept reemployment with
the Federal government, by appointment or personal services
contract, for a period of 5 years after the date of separation
unless the employee repays the entire amount of the incentive to
the agency that paid the incentive.  Waivers are allowed for
appointments where an employee has unique abilities and is the only
applicant for the job.  Waivers are not allowed for personal
services contracts.   

Additional Information and Counseling

I want to emphasize that applying for a separation incentive 
payment is entirely voluntary on your part.  To help you make this
important decision, we have set up a special hotline to give you
more information.  TDD services and sign interpretive services are
also available.  Personnel specialists can provide you with
computations of your separation payment and, if eligible, your
retirement annuity.  Formal counseling sessions are also available
for you and your spouse and can be scheduled by contacting the
personnel office in Room _____

Application Procedures

In order to be considered for a voluntary separation incentive
payment, you must complete an application available from your
personnel office.  If the personnel office has not received your
application by (insert time) on (insert date), you will not be
considered for a voluntary separation incentive payment.  If you
will be out of town and unable to complete and deliver the
application, please call the personnel office for instructions
(insert telephone number).

                              Signed
                              Agency Head 




[BBS Note-Attachment 3 continues on next page.]
























SAMPLE 1A


  ENCLOSURE TO LETTER ANNOUNCING INCENTIVE PROGRAM TO EMPLOYEES


        POSITIONS DESIGNATED FOR EXCLUSION OR EXTENSION 


The occupations, positions, series, and grades for which incentives
are authorized include the vast majority of jobs within the agency. 
However, because of critical workload needs, some positions and
components have been excluded from eligibility or will require the
employee's separation to be extended in order for the employee to
receive a voluntary separation incentive payment.


A. POSITIONS EXCLUDED FROM VOLUNTARY SEPARATION INCENTIVE PAYMENTS

The occupations/grade levels for which the incentives will not be
offered are:

[BBS Note: These are only sample positions.]
 
     Schedule C positions
     
     Cost Analysts (1102, 1515)

     Computer Scientists in grades GS-5 to 9

     Positions covered by special salary rates

     Positions in the Congressional Liaison Office


B. POSITIONS COVERED BY A DELAYED SEPARATION DATE

To ensure the performance of the agency's mission, the separation
of employees in the following occupations who apply for voluntary
separation incentive payments may be delayed for up to 2 years:

     Personnel Office Staff involved in downsizing activities

(Note to agencies: the exclusions identified above are examples
only.  Under the law, agencies have broad flexibility to determine
the positions it will exclude from incentive offers, based on the
agency's needs.)

[BBS Note-Attachment 3 continues on next page.]





SAMPLE 2A


                 APPLICATION TO RESIGN WITH VSIP


The application to participate in the voluntary separation
incentive program will be available from your personnel office, or
you may submit the following typewritten statement if you are
resigning.  



I HEREBY REQUEST TO RESIGN WITH A VOLUNTARY SEPARATION INCENTIVE
PAYMENT EFFECTIVE    (DATE)   .  MY DECISION TO RESIGN IS ENTIRELY
VOLUNTARY AND HAS NOT BEEN COERCED.

I UNDERSTAND THAT IF I VOLUNTEER TO SEPARATE FROM MY CURRENT
EMPLOYMENT AND RECEIVE A VOLUNTARY SEPARATION INCENTIVE PAYMENT, I
WILL BE RESPONSIBLE FOR REPAYING THE ENTIRE INCENTIVE PAYMENT TO
THE AGENCY AWARDING IT IF I AM REEMPLOYED BY THE FEDERAL GOVERNMENT
IN THE NEXT FIVE YEARS, EITHER BY APPOINTMENT OR PERSONAL SERVICES
CONTRACT.  I FURTHER UNDERSTAND THAT, IF I AM SELECTED TO RECEIVE
A SEPARATION INCENTIVE, THIS STATEMENT SERVES AS MY COMMITMENT TO
RESIGN.  IF NOT SELECTED TO RECEIVE THE SEPARATION INCENTIVE, I
UNDERSTAND THAT I WILL BE NOTIFIED AND THAT I WILL NOT BE BOUND BY
MY ELECTION TO RESIGN.


__________________________________________________
Signature                     Date



[BBS Note-Attachment 3 continues on next page.]



















                           SAMPLE 2B


                APPLICATION TO RETIRE WITH VSIP 


The application to participate in the voluntary separation
incentive program will be available from your personnel office, or
you may submit the following typewritten statement if you are
retiring (under either regular or early retirement). 


I HAVE MET THE AGE AND SERVICE REQUIREMENT FOR EARLY OR REGULAR
RETIREMENT.  I HEREBY REQUEST TO RETIRE WITH A VOLUNTARY SEPARATION
INCENTIVE PAYMENT EFFECTIVE  (DATE) .  MY DECISION TO RETIRE IS
ENTIRELY VOLUNTARY AND HAS NOT BEEN COERCED.

I UNDERSTAND THAT IF I VOLUNTEER TO SEPARATE FROM MY CURRENT
EMPLOYMENT AND RECEIVE A VOLUNTARY SEPARATION INCENTIVE PAYMENT, I
WILL BE RESPONSIBLE FOR REPAYING THE ENTIRE INCENTIVE PAYMENT TO
THE AGENCY AWARDING IT IF I AM REEMPLOYED BY THE FEDERAL GOVERNMENT
IN THE NEXT FIVE YEARS, EITHER BY APPOINTMENT OR PERSONAL SERVICES
CONTRACT.  I FURTHER UNDERSTAND THAT, IF I AM SELECTED TO RECEIVE
A SEPARATION INCENTIVE, THIS STATEMENT SERVES AS MY COMMITMENT TO
RETIRE.  IF NOT SELECTED TO RECEIVE THE SEPARATION INCENTIVE, I
UNDERSTAND THAT I WILL BE NOTIFIED AND THAT I WILL NOT BE BOUND BY
MY ELECTION TO RETIRE.



_______________________________________________________
Signature                          Date 



[BBS Note-Attachment 3 continues on next page.]



















SAMPLE 3

                                
   VOLUNTARY SEPARATION INCENTIVE PAYMENT RESIGNATION SURVEY 


John J. Employee, Personnel Staffing Specialist, GS-212/12, U.S.
OPM Potential Separation Incentive Pay Estimate: $25,000**
Service Computation Date:               08/15/1974



Completing this form is purely optional and in no way obligates you
to elect resignation.  Please check the following as applicable:

     _____If offered, I am interested in applying for resignation
with separation incentive pay. 

     _____I am not interested in applying for resignation at this
time.















Note:  A resignation Separation Benefits Briefing is scheduled to
be held on (enter date).  The following topics will be discussed:

               o    Federal Employee's Group Life Insurance
               o    Annual and Sick Leave
               o    Federal Employee's Health Benefits
               o    Thrift Saving Plan
               o    Civil Service Retirement System (CSRS)
               o    Federal Employee's Retirement System (FERS)


**  If you had active military duty preceding your civil service
appointment, your actual separation incentive amount may be lower
than the estimate provided above.

[BBS Note-Attachment 3 continues on next page.]


SAMPLE 4


    VOLUNTARY SEPARATION INCENTIVE PAYMENT RETIREMENT SURVEY 



Jane Employee, Personnel Staffing Specialist, GS-212/12, U.S. OPM

Potential Separation Incentive Pay Estimate:($25,000)
Early Retirement Eligibility: 03/06/90
Voluntary Retirement Eligibility:08/06/98
Service Computation Date:     03/06/65



Note: The above information is provided to assist you in responding
to this survey.  It contains estimates based on information
currently available.  Specific review of your personnel history
will be necessary to determine exact entitlement and dates.  See
your retirement counselor or call xxx-xxxxx for details.





Completing this form is purely optional and in no way obligates you
to elect retirement.  Please check the following as applicable:

_____If offered, I am interested in applying for retirement with a
separation incentive payment.


_____I am not interested in retirement at this time.


_____I have questions regarding the following:


[BBS Note-Attachment 3 continues on next page.]














                           SAMPLE 5


               MEMO FROM AGENCY TO EXTEND EMPLOYEE
             BEYOND CLOSURE DATE OF INCENTIVE WINDOW


MEMORANDUM TO    (NAME)  

Subject:  Approval of Voluntary Separation Incentive Payment with
Extended Separation Date


We have approved your application for a voluntary separation
incentive payment based on your (retirement/resignation).  Because
your services will be required past the closing date of this
authority, your separation is now scheduled to occur on or before
(DATE)   .

Under the Federal Workforce Restructuring Act of 1994 (P.L. 103- 
), an agency may delay the separation of employees receiving
incentive payments when the employee is needed to ensure
performance of the agency's mission.  It is possible that
circumstances may change to permit separation earlier than the
above date.  If so, you will be notified of a revised separation
date.

If you remain employed with the agency until this time, upon
separation, you will receive a separation incentive payment and be
eligible for early (or optional) retirement based on your age and
length of service at the time of your separation.

You have the right to tender your separation at any time you
choose.  However, if you decline to remain on board until the
extended separation date, you will not be entitled to a voluntary
separation incentive payment.

Please complete the appropriate attached form to confirm your
decision.

Return the form to Room 100 by  (DATE) .


                              S/
                              Agency Head

[BBS Note-Attachment 3 continues on next page.]







SAMPLE 6


          EMPLOYEE ACCEPTANCE OF AGENCY INCENTIVE OFFER
                  WITH EXTENDED SEPARATION DATE


                           ACCEPTANCE



     THIS SERVES AS WRITTEN CONFIRMATION OF MY DECISION REGARDING
     THE OFFER OF A BUYOUT WITH AN EXTENDED SEPARATION DATE.

     I AGREE TO THE AGENCY'S OFFER TO EXTEND MY SEPARATION DATE
     TO   NTE (DATE).  MY DECISION IS ENTIRELY VOLUNTARY AND HAS
     NOT BEEN COERCED.

     I UNDERSTAND THAT THIS SERVES AS MY COMMITMENT TO FULFILL
     THE CONDITIONS OF THE VOLUNTARY SEPARATION INCENTIVE
     PROGRAM.  I FURTHER UNDERSTAND THAT IF I DO NOT FULFILL THE
     CONDITIONS OF THE AGREEMENT, I WILL NOT BE ELIGIBLE FOR A
     VOLUNTARY EARLY SEPARATION INCENTIVE PAYMENT.



___________________________________          ___________
Signature                          Date


[BBS Note-Attachment 3 continues on next page.]























SAMPLE 7


         EMPLOYEE DECLINATION OF AGENCY INCENTIVE OFFER
                 WITH EXTENDED SEPARATION DATE 


                           DECLINATION






     THIS SERVES AS WRITTEN CONFIRMATION OF MY DECISION REGARDING
     THE OFFER OF A BUYOUT WITH AN EXTENDED SEPARATION DATE.

     I HEREBY DECLINE THE AGENCY'S OFFER OF A VOLUNTARY
     SEPARATION INCENTIVE PAYMENT UNDER AN EXTENDED SEPARATION
     DATE.  MY DECISION IS ENTIRELY VOLUNTARY AND HAS NOT BEEN
     COERCED.

     I UNDERSTAND THAT BY DECLINING THIS OFFER, I RELINQUISH ALL
     CLAIMS TO A VOLUNTARY SEPARATION INCENTIVE PAYMENT.





___________________________________          ___________
Signature                          Date 


[BBS Note-Attachment 4 follows on next page.]




















Attachment 4

NEW STREAMLINED VOLUNTARY EARLY RETIREMENT PROCEDURES


A.  NEW STREAMLINED PROCEDURES

1.   OPM is offering expanded voluntary early retirement
authority to all agencies faced with an excess of personnel.  (This
expanded voluntary early retirement option is summarized in Section
B-2 of FPM Supplement 351-1.)  These streamlined procedures provide
agencies with maximum flexibility in using voluntary early
retirement to minimize the number of employees reached for
involuntary separation because of organizational changes such as
restructuring, fiscal shortfalls, etc.  Also, the expanded
voluntary early retirement authority allows agencies maximum
opportunity to encourage attrition through the use of buyouts.

2.   What the expanded early retirement authority means:


o  Agency headquarters can now request early retirement authority
on as broad or narrow a basis as the agency chooses.  Early out
offers could be made on an agencywide basis or, at the agency's
discretion, authorized for individual components, locations or
occupational series and grades, for specific window period(s) set
by the agency.


o  All percentage criteria for determining whether a particular
downsizing situation qualifies for voluntary early retirement are
eliminated.

o  An agency will receive voluntary early retirement authority for
up to a year with the option of requesting another expanded
authority if the agency finds it still has surplus employees.

B.  ELIGIBILITY OF EMPLOYEES TO RETIRE EARLY

1.   In order to be eligible to retire under a voluntary early 
retirement authority, by the date of separation, an employee must:

     a.   have completed at least 20 years of creditable service
          and be at least age 50; or completed at least 25 years of
          creditable service regardless of age;

     b.   have served in a position covered by the Civil Service
          Retirement System for at least 1 year out of the 2 years
          immediately before retirement (this requirement does not
          apply to employees covered by the Federal Employees
          Retirement System);

     c.   be serving under a nontemporary appointment; and

     d.   have been on the agency's rolls at least 30 days before
          the agency's request to OPM for voluntary early
          retirement authority, and remained continuously (i.e.,
          without a break in service) on the agency's rolls since
          that time.

C.  VOLUNTARY BASIS OF EARLY RETIREMENTS

Each agency that is issued voluntary early retirement authority
must ensure that employees are not coerced into retiring early. 
The agency must issue a statement to each employee affirming that
early retirement is, in fact, voluntary.  Also, if agency
management becomes aware of any coercion of employees into early
retirement, the agency should take appropriate corrective action.

D.  USE OF THE EXPANDED VOLUNTARY EARLY RETIREMENT AUTHORITY

1.   An agency may determine coverage of early retirement authority
     and may restrict a voluntary early retirement authority  by
     organizational components, job series, grade levels, or other
     basis.  These restrictions can be set when the agency requests
     the authority from OPM, or on the agency's own initiative
     after OPM approval.

2.   The agency may establish early retirement windows for
     designated components, locations, programs, etc., during the
     extended window period approved for the agency.  
3.   The agency may adopt any fair and objective method for
     approving applications if it must limit the number of
     voluntary early retirements.
 
4.   As covered in OPM's approval letter for an expanded authority,
     it is essential that agencies keep OPM informed of any changes
     in the coverage or timing of early retirement offers.  This
     will enable OPM to better prepare for the timely processing of
     an expected increase in early retirements.  We encourage
     agencies to provide OPM with monthly summaries of where
     voluntary early retirements will be offered, the window period
     for an eligible component, and the number of employees
     expected to retire.  

E.  SUBMITTING REQUESTS TO OPM

1.   Agencies should submit requests for voluntary early retirement
     authority to:
               Office of Personnel Management
               Federal Workforce Restructuring Office
               Room 6504
               1900 E Street, NW
               Washington, DC  20415
               
               Phone 202-606-0960; Fax 202-606-2329

2.   An agency's request for voluntary early retirement must be
     signed by the head of the agency or a specific designee.

3.   Please see the attached sample request for voluntary early
     retirement authority.  Each request must contain the following
     information:

     a.   Identification of the agency for which the authority is
          requested.  

     b.   Reasons why the voluntary early retirement authority is
          needed, including an overview of the agency's personnel
          and budgetary situation that will result in an excess of
          personnel.

     c.   The window period for voluntary early retirements.  OPM
          may approve voluntary early retirement authority for up
          to a year.  When it expires, the agency may request
          another expanded authority if it still has surplus
          employees.  

          Under the expanded voluntary early retirement option, an
          agency may use a single authority to offer voluntary
          early retirement agencywide during the extended window
          period.  The agency may establish early retirement
          windows for designated components, locations, programs,
          etc., during the extended window period. 

     d.   The total number of nontemporary employees in the agency.

     e.   The total number of nontemporary employees in the agency
          who are, or will be, excess during a time period
          explained by the agency (e.g., the current fiscal year,
          the next two fiscal years, etc.). 

     f.   The total number of nontemporary employees in the agency
          who are eligible for voluntary early retirement.

     g.   The total number of nontemporary employees in the agency
          who are expected to retire early during the period
          covered by the request.

4.   The name, title, telephone number, and fax number of an agency
     contact person for the authority.

F.  REPORTS TO OPM ON USE OF EACH AUTHORITY

1.   Agencies are expected to provide OPM with interim and final
     reports on each voluntary early retirement authorization. 
     These reports are sent (or faxed) to the same address from
     which agencies request the authority (see paragraph E-1
     above).

2.   P.L. 103-   requires annual reports to Congress on the use of
     Voluntary Separation Incentive Payments (VSIP).  For the
     convenience of agencies, OPM has combined the reporting
     requirements for VSIPs with agency reports on the use of
     voluntary early retirement authority.  Status reports from all
     agencies receiving early retirement authority are due on the
     following basis:

     a.   An interim report is due 30 days after the end of each
          quarter following approval of the authority.

     b.   A final report is due 60 days following the closure date
          of the authority.

3.   Each report to OPM on a voluntary early retirement
     authorization must contain the following information:

     a.   The number of voluntary early retirements with VSIPs and
          the average age, average grade, and average VSIP amount
          of such retirees, with the number of such retirees by
          grade/pay level, duty station city/state, and amount of
          VSIP.

     b.   The number of voluntary early retirements without VSIPs
          and the average age and average grade of such retirees,
          with the number of such retirees by grade/pay level and
          duty station city/state.

     c.   The number of optional retirements with VSIPs during the
          window period of the early retirement authority and the
          average age, average grade, and average VSIP amount of
          such retirees, with the number of such retirees by
          grade/pay level, duty station city/state, and amount of
          VSIP.

     d.   The number of resignations with VSIPs during the window
          period of the early retirement authority and the average
          age, average grade, and average VSIP amount of such
          employees, with the number of such resignations by
          grade/pay level, duty station city/state, and amount of
          VSIP. 

     e.   The total number of employees who left through other
          options during the window period of the authority, by
          type and by total (i.e., other retirements and
          resignations in which VSIPs were not offered, transfers,
          etc).

Please see the attached report format.


[BBS Note-Attachment 4 continues on next page.]





                             SAMPLE 


                         REQUEST TO OPM 

        FOR EXPANDED VOLUNTARY EARLY RETIREMENT AUTHORITY


As a result of recent legislation, the Department of______________ 
must undergo a major reorganization in which ______ of ______
employees will excess over the next two fiscal years.  A summary of
the agency's restructuring plan is attached.  Voluntary early
retirement, used in conjunction with any available Voluntary
Separation Incentive Payments (VSIP), will help the Department
reduce the number of excess employees.

This voluntary early retirement authority is requested for all
series and grades in the Department.  The Department may further
limit this authority to meet management's needs.

Voluntary early retirement authority is requested for the period
from (insert date) through (insert date).

The current number of nontemporary employees in the Department is
(insert number).

The estimated number of nontemporary employees in the Department
who will be excess by the end of FY 1995 is (insert number).

The number of nontemporary employees in the Department who are
eligible for voluntary early retirement is (insert number).

The number of nontemporary employees in the Department who are
expected to accept voluntary early retirement is (insert number).

The Department's point of contact for this voluntary early
retirement request is (insert name), (insert title) (insert
telephone number), (insert fax number).


[BBS Note-Attachment 4 continues on next page.]












                            REPORT TO OPM 
ON USE OF VOLUNTARY SEPARATION INCENTIVES AND VOLUNTARY EARLY
RETIREMENT AUTHORITY 
  
P.L. 103-   requires reports to Congress on use of voluntary
separation incentive payments (VSIP).  OPM has combined this
reporting requirement with agency reports on the use of voluntary
early retirement authority (VERA) in the format specified below. 
These reports are due 30 days after the end of each quarter
following approval of the VERA, with a final report due 60 days
after the final closure of the VERA authority.  Please complete the
following report and send to the Office of Personnel Management,
Federal Workforce Restructuring Office, Room 6504, 1900 E Street,
NW, Washington, DC 20415.  You may fax the report to 202-606-2329.
  
Voluntary Early Retirement Authority Number______________         
Cumulative Data as of ________

Agency:        _____________________________________________

Component/Location:_____________________________________________


(1)  Number of voluntary early retirements with VSIP paid: 
     (a)  Total early retirees with VSIP:________
     (b)  Average age of early retirees with VSIP:________
     (c)  Average grade of early retirees with VSIP:________
     (d)  Average amount of VSIP:   ________
     (e)  List number of early retirees by grade/pay level, duty
station city/state, and amount of VSIP:

(2)  Number of voluntary early retirements, during this authority,
without VSIP:
     (a)  Total early retirees without VSIP:________
     (b)  Average age of early retirees without VSIP:________
     (c)  Average grade of early retirees without VSIP:________
     (d)  List number of early retirees by grade/pay level and duty
station city/state:
               

(3)  Number of optional retirements with VSIP paid: 
     (a)  Total optional retirements with VSIP:________
     (b)  Average age of optional retirees with VSIP:________
     (c)  Average grade of optional retirees with VSIP:________
     (d)  Average amount of VSIP:   ________
     (e)  List number of optional retirees by grade/pay level, duty
station city/state, and amount of VSIP:


(4)  Number of resignations with VSIP paid: 
     (a)  Total resignations with VSIP:  ________
     (b)  Average age of resignees with VSIP:________
     (c)  Average grade of resignees with VSIP:________
     (d)  Average amount of VSIP:   ________
     (e)  List number of resignees by grade/pay level, duty station
city/state, and amount of VSIP:


(5)  Other attrition that occurred without VSIP:
     Total separations:                 ________
     Other retirements:                 ________
     Other resignations:           ________
     Other transfers:                   ________
     Other:                        ________

(6)  Number of employees offered a VSIP to be carried over past the
closing date of the window period for this authority--
Please list by type (quit, VERA, optional retirement, etc.) and
total.


[BBS Note-Attachment 5 begins on next page.]




































Attachment 5

DOWNSIZING INFORMATION ON OPM'S ELECTRONIC BULLETIN BOARDS

OPM's Downsizing Support Team posts valuable information on
downsizing and reduction in force on two electronic bulletin
boards.  These are free services open to anyone with a computer and
a modem.  Here is some information to assist in accessing these
invaluable services.

To access either board, all you need is:

     o    An IBM-compatible computer;
     o    A modem (300 BAUD or faster);
     o    A standard telephone line;
     o    Communications software (such as PROCOMM, CROSSTALK,
ENABLE, etc. The setup is the standard N-8-1).

Personnel Operations and Staffing Headquarters--POSH

(1)  Use your modem and dial (912) 757-3100.
(2)  Follow the simple registration procedures for first time
callers.
(3)  At the Main Menu, type "P" for "Policy Operations and Staffing
Headquarters--POSH".
(4)  At the POSH Menu, type "J" to join a conference.
(5)  At the conference menu, type "15" and press the enter key.

You may now select from a variety of options.  For example, you may
read any bulletins posted on downsizing (type  B), send a message
or ask a question (type  S), or download files to your own computer
(type  F).  To download files:   
     (1)  Enter the "files" area (type  F);
     (2)  Type  1  to enter the area for downloading files;
     (3)  Type  S  to stop listing files;
     (4)  Type  D  and press the enter key to download;
     (5)  Type the file name and press enter;

The board will then ask you to enter a modem download protocol. 
XMODEM and ZMODEM are the two most common.  If you aren't sure of
your modem's protocol, try one of these.  The board will then wait
for you to enter your communication software program's "START"
command (I.E. PROCOMM is the "Page Down" key).

OPM's MAINSTREET

(1)  Use your modem and dial (202)606-4800.
(2)  Follow the simple registration procedures for first time
callers.
(3)  At the Main Menu, type  1  to join a Forum;
(4)  At the OPM Forums Menu, type  K  to join the Downsizing/RIF
Forum.

You may now select from a variety of options.  For example, you may
view any bulletins posted on downsizing, send a message or ask a
question, or download files to your own computer.

We hope this is helpful. For further details on accessing the
board: refer to FPM Bulletin 351-58, March 28, 1993.  To contact
the Downsizing Support Team, call (202) 606-0960 or FAX (202)
606-2329.


[BBS Note-Attachment 6 begins on next page.]












































Attachment 6

Attached is a section analysis of the Federal Workforce
Restructuring Act of 1994.  The full text of the act will be
posted, as soon as it is available, on OPM's electronic bulletin
boards (at 912-757-3100 and 202-606-4800).  On both boards, the
file name for the legislation is VSIPLAW.TXT.  See attachment 5 for
instructions on using the BBS.


Summary of the Federal Workforce Restructuring Act, H.R. 3345
(as enacted)


Section 1-- Short title

"Federal Workforce Restructuring Act of 1994"

Section 2-- Training Act Amendments

Broadens the purposes for which Federal Agencies may provide
training to employees and eliminates the distinction between
Government and non-Government training.

Section 3-- Voluntary Separation Incentives

Authorizes Executive branch agencies, excluding the Department of
Defense and the Central Intelligence Agency, to offer incentives of
up to $25,000 to employees willing to voluntarily separate from
Government service.  The authority to offer separation
incentives expires on March 31, 1995.  Employees are required to
pay back the full bonus if reemployed by the Government within five
years.  Repayment may be waived if the employee possesses
unique abilities and is the only qualified applicant available for
the position.

Section 4-- Additional Agency Contributions

Requires that, in fiscal years 1994 and 1995, all agencies pay an
additional 9% to the Civil Service Retirement Fund for all
employees accepting a buy-out offer who take early retirement.  In
fiscal years 1995 through 1998, each Executive branch agency is
required to make an additional contribution to the Civil
Service Retirement and Disability Fund equal to $80 for each CSRS
or FERS participant on its active payroll.

Section 5-- Reduction of Federal Positions

Establishes that the total number of full-time equivalent
positions in all agencies shall not exceed 2,084,600 in FY 1994;
2,043,300 in FY 1995; 2,003,300 in FY 1996; 1,963,300 in FY 1997;
1,922,300 in FY 1998; and 1,882,300 in FY 1999.  Also requires
agencies to reduce the number of full-time equivalent positions
on a one-for-one basis for each buy-out accepted and prohibits
any increase in the use of contracts for personal services as a
result of the reduction in Federal employment under the provision
of this Act.

Section 6-- Monitoring and Reporting Requirements

Requires the Office of Personnel Management to submit an annual
report to the House Committee on Post Office and Civil Service
and the Senate Committee on Governmental Affairs including
information on employees accepting voluntary separation payments
and on waivers granted in the case of reemployment by the
Government.

Section 7-- Dislocation Payments for Certain Contractor Personnel

Authorizes dislocation pay of $5,000 ( the amount of total
payments not to exceed $1,000,000) for NASA Advanced Solid Rocket
Motor contractor employees hired locally by Lockheed Missiles and
Space Company, Aerojet ASRM Division, and the Rust Corporation at
Yellow Creek, Mississippi.

Section 8-- Repayment of Separation Pay

Extends the requirement to repay the separation incentive if
reemployed by the Government within 5 years to employees of the
Department of Defense and the Central Intelligence Agency who
accept such incentives and separate on or after the date of
enactment.

Section 9-- Thrift Savings Plan Withdrawals

Standardizes the withdrawal options available to participants in
the Thrift Savings Plan when they separate from Government service.

Section 10-- Alaska Railroad Transfer Act Amendments

Authorizes the Alaska Railroad to participate in the voluntary
separation incentive program and amends current law providing
Federal employee health and life insurance coverage to certain
Alaska Railroad retirees.


[BBS note-End of IAG letter.]
