[Federal Register Volume 59, Number 144 (Thursday, July 28, 1994)]
[Unknown Section]
[Page ]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-18369]
[Federal Register: July 28, 1994]
VOL. 59, NO. 144
Thursday, July 28, 1994
OFFICE OF PERSONNEL MANAGEMENT
5 CFR Part 842
RIN 3206-AF92
Federal Employees Retirement System--Coverage
AGENCY: Office of Personnel Management.
ACTION: Proposed rule.
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SUMMARY: The Office of Personnel Management (OPM) is proposing
regulations concerning exclusions from coverage under the Federal
Employees Retirement System (FERS) for employees who have at least 5
years of service creditable under the Civil Service Retirement System
(CSRS). These regulations would clarify the existing regulations to
specifically state the requirement that, if the employee has a break in
service ending after 1986, the employee's past service must include
some service covered by CSRS to be excluded from automatic FERS
coverage. The regulations are necessary to clarify the current
regulations and to conform to OPM's guidance since implementation of
FERS.
DATES: Comments must be received on or before September 26, 1994.
ADDRESSES: Send comments to Reginald M. Jones, Jr., Assistant Director
for Retirement Policy Development; Retirement and Insurance Group;
Office of Personnel Management; P.O. Box 57; Washington, DC 20044; or
deliver to OPM, Room 4351, 1900 E Street SW., Washington, DC.
FOR FURTHER INFORMATION CONTACT: Harold L. Siegelman, (202) 606-0299.
SUPPLEMENTARY INFORMATION: The general rule that a Federal employee who
is covered by social security is automatically covered by the Federal
Employees Retirement System (FERS) unless the employee is excluded from
FERS coverage by statute or regulation is stated in section 842.103 of
Title 5, Code of Federal Regulations. (FERS coverage is available only
to employees covered by social security. See generally definition of
employee under 5 CFR 842.102.) However, our current coverage
regulations present many of the statutory exclusions to FERS coverage
in terms of election rights that belong in part 846 of Title 5, Code of
Federal Regulations. To simplify the regulations, we propose to revise
sections 842.101 and 842.104 to limit the scope of subpart A of part
842 to automatic FERS coverage, leaving the regulation of all transfer
issues to part 846.
Section 8402(b) of title 5, United States Code, establishes the
statutory exclusions from coverage under FERS. The regulations
implementing this provision are contained in section 842.104 of Title
5, Code of Federal Regulations. These proposed regulations seek to
clarify the regulations and eliminate redundancies in a manner
consistent with OPM's implementation of FERS since the system's
inception.
Section 8402(b)(1) of title 5, United States Code, excludes certain
senior officials from automatic FERS coverage.
The statute applies to senior officials who were placed under
mandatory social security coverage at the beginning of 1984 and who
have continuous service since December 31, 1983. Proposed section
842.104(b) would use essentially the same language as our current
section 842.104(c) of Title 5, Code of Federal Regulations, to
implement this paragraph.
Section 8402(b)(2) of title 5, United States Code, provides two
mutually exclusive sets of exclusions from automatic FERS coverage.
Subparagraph (A) applies to employees who reenter service on or after
January 1, 1987 (the general effective date of the FERS Act of 1986)
after a break in service. Subparagraph (B) applies to employees not
covered by subparagraph (A), specifically, employees who have served
continuously since December 31, 1986. OPM has applied this approach to
the exclusion since the inception of FERS.
Employees who have had a break in service ending after December 31,
1986, are excluded from automatic FERS coverage if they satisfy the
two-part test under subparagraph (A). The two-part test requires both
some service (at least 1 day) covered by the Civil Service Retirement
System (CSRS) or the Foreign Service Retirement System (FSRS) and at
least 5 years of civilian service creditable under CSRS rules as of the
last separation from service. Proposed section 482.104(c) would revise
our current section 842.104(b) of Title 5, Code of Federal Regulations,
to clarify our existing regulation that implements this provision.
Employees who have not had a break in service ending after December
31, 1986, are excluded from automatic FERS coverage if they satisfy the
one-part test under subparagraph (B). These employees are excluded from
automatic FERS coverage--even if they have no prior service covered by
CSRS or FERS--as long as they did have at least 5 years of creditable
civilian service (under CSRS rules) before January 1, 1987. Proposed
section 842.104(d) would merge and revise current paragraphs (a) and
(e) of section 842.104 of Title 5, Code of Federal Regulations, to
simplify and clarify the regulations. Paragraph (e) particularly needs
to be revised because the regulatory text does not show that it applies
only to employees with just social security coverage such as those
serving under multiple term appointments continuously since December
31, 1986. The supplementary information in our notice of interim
rulemaking (published at 51 FR 47195, 47196, on December 31, 1986)
states the intended scope of this paragraph, which also reflects our
guidance to the employing agencies that make these determinations.
Proposed section 842.104(e) defines a break in service for the
purpose of applying these rules as a separation from CSRS-covered
service lasting more than 3 days, consistent with our general practice.
However, in unusual circumstances employees will also be considered to
have had a break in service in situations in which there may be no
period of separation from service but the individual acquires automatic
social security coverage (e.g., when a District of Columbia employee
who is excluded from social security transfers to a Federal position).
Proposed section 842.104(e) restates the current section 842.104(f)
applicable to certain employees who have exercised their election
rights under section 8461(n) of title 5, United States Code, to retain
coverage under a retirement system for employees of nonappropriated
fund instrumentalities.
OPM's guidance on making coverage determinations is not affected by
these amendments, which are intended to clarify the regulations and
ensure that they will be interpreted correctly and in accordance with
our existing guidance, ``The CSRS and FERS Handbook for Personnel and
Payroll Offices'' (formerly FPM Supplement 830-1), chapter 10.
Regulatory Flexibility Act
I certify that this regulation will not have a significant economic
impact on a substantial number of small entities because the regulation
will only affect Federal employees and agencies and retirement payments
to retired Government employees and their survivors.
List of Subjects in 5 CFR Part 842
Administrative practice and procedure, Air traffic controllers,
Firefighters, Government employees, Law enforcement officers, Pensions,
Reporting and recordkeeping, Retirement.
U.S. Office of Personnel Management.
Lorriane A. Green,
Deputy Director.
Accordingly, OPM proposes to amend 5 CFR part 842 as follows:
PART 842--FEDERAL EMPLOYEES RETIREMENT SYSTEM--BASIC ANNUITY
1. The authority citation for part 842 continues to read as
follows:
Authority: 5 U.S.C. 8461(g); Secs. 842.104 and 842.106 also
issued under 5 U.S.C. 8461(n); Sec. 842.105 also issued under 5
U.S.C. 8402(c)(1) and 7701(b)(2); Sec. 842.106 also issued under
section 7202 (m)(2) of the Omnibus Budget Reconciliation Act of
1990, Pub. L. 101-508 and 5 U.S.C. 8402(c)(1); Secs. 842.604 and
842.611 also issued under 5 U.S.C. 8417; Sec. 842.607 also issued
under 5 U.S.C. 8416 and 8417; Sec. 842.614 also issued under 5
U.S.C. 8419; Sec. 842.615 also issued under 5 U.S.C. 8418;
Sec. 842.703 also issued under section 7001 (a)(4) of the Omnibus
Budget Reconciliation Act of 1990, Pub. L. 101-508; Sec. 842.707
also issued under section 6001 of the Omnibus Budget Reconciliation
Act of 1987, Pub. L. 100-203; Sec. 842.708 also issued under section
4005 of the Omnibus Budget Reconciliation Act of 1989, Pub. L. 101-
239 and section 7001 of the Omnibus Budget Reconciliation Act of
1990, Pub. L. 1001-508; subpart H also issued under 5 U.S.C. 1104.
Subpart A--Coverage
2. Section 842.101 is revised to read as follows:
Sec. 842.101 Purpose and scope.
(a) This subpart contains regulations concerning automatic coverage
under the Federal Employees Retirement System (FERS). References to
FERS coverage in this subparts are to automatic, as opposed to
elective, FERS coverage.
(B) Part 846 of this chapter contains regulations concerning
elective FERS coverage. FERS elections are available under limited
circumstances to employees not subject to automatic FERS coverage.
3. Section 842.104 is revised to read as follows:
Sec. 842.104 Statutory exclusions.
(a) Lack of social security coverage. An individual not covered by
social security (title II of the Social Security Act and chapter 21 of
the Internal Revenue Code of 1954), including an individual covered by
full CSRS (and thereby excluded from social security coverage), is
excluded from FERS coverage.
(b) Senior officials subject to social security coverage despite
continuous service. An individual who has served without a break in
service of more than 365 days since December 31, 1983, in one or more
of the following positions is excluded from FERS coverage.
(1) The Vice President;
(2) A Member of Congress;
(3) A non-SES appointee to a position listed in 5 U.S.C. 5312
through 5317;
(4) A Senior Executive Service or Senior Foreign Service noncareer
appointee; or
(5) An individual appointed by the President (or his designee) or
the Vice President under section 105(a)(1), 107(a)(1), or (b)(1) of
title 3, United States Code, to a position for which the maximum rate
of basic pay is at or above the rate for Level V of the Executive
Schedule.
(c) Employees rehired after December 31, 1986, following a break in
service. An employee who is rehired after December 31, 1986, who has
had a break in service and who, at the time of the last separation from
the service, had at least 5 years of civilian service creditable under
CSRS rules, any part of which was covered by CSRS or the Foreign
Service Retirement System, is excluded from FERS coverage.
(d) Employees who have not had a break in service ending after
December 31, 1986. An employee who has not had a break in service of
more than 3 days ending after December 31, 1986, and who, as of
December 31, 1986, has at least 5 years of creditable civilian service
under CSRS rules (even if none of this service was covered by CSRS), is
excluded from FERS coverage.
(e) Break in service. For the purposes of paragraph (c) and (d) of
this section, ``break in service'' means a separation from CSRS-covered
service lasting at least 4 days, or a transfer or separation of less
than 4 days when the employee becomes subject to automatic coverage
under social security (title II of the Social Security Act and chapter
21 of the Internal Revenue Code of 1954).
(f) Coverage under a retirement system for NAF employees. An
employee who has elected coverage under a retirement system for NAF
employees in accordance with Sec. 842.106 is excluded from FERS
coverage during that and all subsequent periods of service, including
service as reemployed annuitant.
[FR Doc. 94-18369 Filed 7-27-94; 8:45 am]
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