USPS ELM Revision: FERS Further Revised Annuity Employees (FRAE)

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Effective March 19, 2015, the Postal Service™ is revis­ing the Employee and Labor Relations Manual (ELM). Recently, section 401 of the “Bipartisan Budget Act of 2013,” signed into law by the President on December 26, 2013, created another class of FERS coverage, FERS-Fur­ther Revised Annuity Employee (FRAE). New career employees (as designated in the statute) hired on or after January 1, 2014, will be covered under FERS-FRAE. The Postal Service retirement coverage codes for FERS-FRAE and FERS-FRAE (LEO) employees have been designated as “E” and “F” respectively.

FERS-FRAE applies to:

  • Any employee who receives an appointment not excluded from FERS coverage on or after January 1, 2014, and would normally be placed in FERS or FERS-RAE.
  • There are three exceptions to this general rule; how­ever, the date December 31, 2013, is a key date for each of these exceptions.

An individual will be excluded from FERS-FRAE cover­age if any of these exceptions apply:

  • The individual on December 31, 2013, was covered under FERS or FERS-RAE; or
  • The individual on December 31, 2013, was perform­ing civilian service which is creditable or potentially creditable service under FERS or FERS-RAE; or
  • The individual on December 31, 2013, was not cov­ered under FERS or FERS-RAE and was not performing civilian service which is creditable or potentially creditable service under FERS or FERS-RAE, but as of December 31, 2013, had performed at least five years of civilian service creditable or poten­tially creditable under FERS-RAE, including service creditable for CSRS and/or CSRS Offset.

ELM 581 is revised to add 581.7 and 581.8 to include employees covered under FERS-FRAE and employees who are excluded from coverage under FERS and FERS-RAE.

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Employee and Labor Relations Manual (ELM)

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5 Employee Benefits

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580 Federal Retirement System

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581 General

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581.1 Scope

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[Add new 581.7 to read as follows:]

581.7 Employees Covered

FERS-Further Revised Annuity Employee (FRAE) applies to:

a. Any employee hired after December 31,2013, who is not excluded from FERS coverage will be subject to FERS-FRAE, unless they meet specific requirements as of December 31, 2012, that would allow them to be subject to original FERS, or unless they meet spe­cific service requirements as of December 31, 2013, that would allow them to be subject to FERS-RAE

b. There are three exceptions to this general rule; how­ever, the date December 31, 2012, is a key date for each of these exceptions.

[Add new 581.8 to read as follows:]

581.8 Exclusions

An employee hired in 2014 or later will be subject to original FERS coverage if any of these exceptions apply:

a. The individual on December 31, 2012, was covered under FERS; or

b. The individual on December 31, 2012, was perform­ing civilian service which is creditable or potentially creditable service under FERS; or

c. The individual on December 31, 2012, was not cov­ered under FERS and was not performing civilian ser­vice, which is creditable or potentially creditable service under FERS, but as of December 31, 2012, had performed at least five years of civilian service creditable or potentially creditable under FERS, in­cluding service subject to the Civilian Service Retire­ment System (CSRS or CSRS-Offset).

An employee hired in 2014 or later who is not subject to original FERS coverage will be subject to FERS-RAE cov­erage if any of these exceptions apply:

a. The employee on December 31, 2013, was covered under FERS-RAE; or

b. The employee on December 31, 2013, was perform­ing civilian service which is creditable or potentially creditable service under FERS; or

c. The employee on December 31, 2013, was not cov­ered under FERS and was not performing civilian service which is creditable or potentially creditable ser­vice under FERS, but as of December 31, 2013, had performed at least five years of civilian service credit­able or potentially creditable under FERS service subject to CSRS or CSRS Offset.

via ELM Revision: FERS Further Revised Annuity Employee.

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