CSRS vs. FERS Federal Disability Retirement

Jan 18, 2017

A federal employee learning about the csrs

csrs

Over the next few weeks, we will be looking at the difference between the Civil Service Retirement System (CSRS) and the Federal Employees Retirement Systems (FERS), specifically how they relate to Federal Disability Retirement. This post will focus on the computation of benefits of these two. Every federal worker falls into one of these retirement systems. While most of those workers fall under FERS, it’s important to discuss these differences.

FERS

This amount is computed differently depending on the person’s age and the amount of service at retirement. It is recomputed after 12 months and again at age 62 (if under age 62 at the time of retirement).

Formula

If the employee is age 62 or older at retirement, or they meet the age/service requirements for an immediate voluntary retirement:

  • The employee would receive 1 percent of their High-3 salary for each year of service if they are age 62 or older with less than 20 years of service, or they are under the age of 62 and qualify for an immediate retirement.
  • 1 percent of the High-3 salary for each year of service is paid if the employee is 62 or older with 20 or more years of service.

If an employee is under age 62 at retirement and not eligible to receive an immediate voluntary retirement:

  • During the first 12 months, the disability annuitant receives 60 percent of their High-3 salary MINUS 100 percent of any Social Security benefit received. Remember you must apply for Social Security Disability to be approved for Federal Disability Retirement.
  • After the first 12 months, the amount is 40 percent of the High-3 salary MINUS 60 percent of any Social Security benefit received.
  • At age 62, the benefit is re-calculated. If the actual service plus the time as a disability annuitant is equal to less than 20 years, the annuitant receives 1 percent of their High-3 salary for each year of service. If the actual service plus the time as a disability annuitant equals more than 20 years, the annuitant receives 1.1 percent of their High-3 salary for each year of service.

**The average salary is increased by all FERS Cost of living adjustments during the time a disability annuity is received. COLA’s aren’t paid during the first 12 months as a disability annuitant.

CSRS

Federal workers who retire under CSRS are entitled to an ‘earned’ annuity computed under the CSRS formula. The law guarantees a minimum annuity to employees who retire because of a disability.

This guaranteed minimum applies if you are under the age of 60 when you retire and your earned annuity, based on your actual service, is less than the minimum.

The guaranteed minimum is the lesser of the following:

  • 40 percent of your High-3 salary.
  • The regular annuity obtained after increasing your service by the time between your retirement and your 60th birthday.

Our experienced team here at Harris Federal Law Firm has helped both CSRS and FERS employees with their federal disability retirement cases for years. If you are looking for a federal disability retirement lawyer, please contact us at 877-226-2723 or fill out this INQUIRY FORM! The consultation is always FREE!

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