Office of Personnel Management

Eliminate re-work & double-work with OPM processing retirements

Suggestion:

 

By Executive Order, change the process for processing retirement annuities so that:

 

1) the annuity computation is performed only once, either by the employing agency or OPM (not both)

2) the first full and correct annuity payment is distributed to the new retiree no later than 1 month following an employee’s retirement.

 

 

Cost Savings:

 

Significant personnel time will be saved across all agencies if one procedure is followed for all retirements.

Calls to the OPM toll-free line about interim payments and the long timeframe for processing retirements will decrease, saving staff time and frustration, as well as phone charges.

 

 

Situation:

 

Re-work: Agencies calculate retiree annuities and then OPM re-calculates them.

 

Double work: OPM sends interim payments while they "finish processing" the application and then sends payments to adjust for the incorrect interim payments.

 

*** Why is this re-work and double work necessary when all payroll information apparently is stored in our computer systems? ***

 

I can view my projected annuity payments in our payroll system at nfc.usda.gov. Why is the process of determining retiree annuities so labor-intensive at OPM?

 

Changing an employee’s status from active to retired should require no more than 2 pay periods for manual processing within an agency and changes to the payroll information needed to issue annuity checks. Just as the computer determines the amount of pay for active employees, it should determine the amount of the annuity for retired employees.

 

The process seems to be a hold-over from the 1950s when these computations were made by hand. Double-checking the final annuity amount made sense then, but it does not make sense in 2011.

For reference about the current process, see http://www.opm.gov/retire/post/new/index.asp.

 

For info about the costly outcome, refer to http://www.federalnewsradio.com/?nid=20&sid=2063448 and http://federalnewsradio.com/?nid=20&sid=2065756

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Idea No. 4121