[Federal Register Volume 66, Number 53 (Monday, March 19, 2001)]
[Rules and Regulations]
[Pages 15606-15618]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 01-6805]



[[Page 15605]]

-----------------------------------------------------------------------

Part VI





Office of Personnel Management





-----------------------------------------------------------------------



5 CFR Parts 831, 839, 841, and 846



Corrections of Retirement Coverage Errors Under the Federal Erroneous 
Retirement Coverage Corrections Act; Interim Rule

  Federal Register / Vol. 66, No. 53 / Monday, March 19, 2001 / Rules 
and Regulations  

[[Page 15606]]


-----------------------------------------------------------------------

OFFICE OF PERSONNEL MANAGEMENT

5 CFR PARTS 831, 839, 841, and 846

RIN 3206-AJ38


Corrections of Retirement Coverage Errors Under the Federal 
Erroneous Retirement Coverage Corrections Act

AGENCY: Office of Personnel Management.

ACTION: Interim rule with request for comments.

-----------------------------------------------------------------------

SUMMARY: The Office of Personnel Management is amending its regulations 
to include new rules for correcting certain retirement coverage errors. 
We are amending the regulations to implement the provisions of the 
Federal Erroneous Retirement Coverage Corrections Act (the FERCCA), 
title II of Public Law 106-265. The regulations will allow agencies and 
OPM to correct affected retirement coverage errors.

DATES: This interim rule is effective March 19, 2001. We must receive 
your comments by April 18, 2001.

ADDRESSES: Send comments on this interim rule to Mary Ellen Wilson, 
Director, Retirement Policy Center, Office of Personnel Management, 
Washington, DC 20415-3200. You may also submit comments by sending 
electronic mail (E-mail) to: [email protected].

FOR FURTHER INFORMATION CONTACT: Cynthia Reinhold, 202-606-0299.

SUPPLEMENTARY INFORMATION:

Introduction

    The Office of Personnel Management (OPM) is amending parts 831, 
841, and 846 of title 5, Code of Federal Regulations, and adding a new 
part 839, to implement the Federal Erroneous Retirement Coverage 
Corrections Act (FERCCA), title II of Public Law 106-265, which was 
enacted on September 19, 2000. The law provides a set of remedies to 
correct substantive retirement coverage errors. The law requires OPM to 
issue implementing regulations.

Background

    Participation in the Civil Service Retirement System (CSRS), the 
Civil Service Retirement System Offset (CSRS Offset) plan, the Federal 
Employees' Retirement System (FERS), and the Thrift Savings Plan (TSP) 
is governed by title 5 of the United States Code. Social Security 
coverage for benefit purposes is governed by section 210 of the Social 
Security Act. Sections 3101(a) and 3111(a) of the Internal Revenue Code 
of 1986 govern the collection and payment of Social Security taxes. 
Coverage under these Federal retirement plans and Social Security is 
mandatory for employees who meet the statutory requirements. Prior to 
passage of this legislation, neither OPM, the Treasury Department, nor 
the Federal Retirement Thrift Investment Board had the statutory 
authority to waive the rules for retirement plan or Social Security 
participation. When errors in retirement coverage occurred, correction 
was mandatory. The employee was ``forced,'' retroactively, into a 
different retirement plan. The mandatory retroactive correction of a 
retirement coverage error can place an employee in a difficult 
financial situation with regard to retirement planning.
    Retirement coverage errors that prevent an employee from saving for 
retirement are usually the most damaging because it is extremely 
difficult to make up the lost opportunity to save. These are primarily 
errors that cause an employee to believe that he or she is covered by 
CSRS rather than FERS. The FERS basic benefit is a little over half 
that of the CSRS benefit. To obtain retirement income under FERS that 
is similar to CSRS, the employee needs to save for retirement in the 
TSP or elsewhere. Because of the error, the employee may not have 
contributed to the TSP, believing that CSRS benefits were enough to 
meet retirement needs. If the error is undiscovered for a long period, 
the employee is forced to begin saving during the years after the error 
is corrected. In the absence of the error, the employee could have 
saved for retirement over his or her entire career.

The FERCCA's Provisions

    The retirement coverage error must have lasted for at least 3 years 
of service after December 1986. January 1, 1987, is the date that FERS 
took effect. From 1984 through 1986, there was no TSP. Accordingly, 
employees did not become disadvantaged with respect to the TSP until 
FERS began. The 3-year yardstick parallels the TSP's 3-year vesting 
rule applicable to most FERS participants.
    The FERCCA provides a choice between retirement plans in many 
situations. Most individuals with a qualifying retirement coverage 
error have the opportunity to choose their retirement coverage under 
the FERCCA. The availability of a choice between retirement plans 
applies to individuals:
     With newly discovered retirement coverage errors,
     With an error that was discovered and corrected in the 
past,
     Who have retired from Federal service, or
     Who are survivors of an individual with a retirement 
coverage error.
    For an individual who is erroneously put in CSRS and belonged in 
FERS, the choice is between CSRS Offset or FERS. CSRS Offset coverage 
is for an employee mandatorily covered by Social Security and CSRS, and 
provides, through combined CSRS and Social Security benefits, a benefit 
that is at least equivalent to, if not more than, CSRS. While working, 
the individual earns retirement credits under the CSRS formula and also 
adds to any Social Security benefits already earned, increasing career 
earnings under Social Security and, as a result, the Social Security 
benefit. At retirement, OPM computes the CSRS Offset benefit under the 
same rules that apply to other CSRS retirees. At age 62 (when the 
individual becomes eligible for Social Security benefits), OPM reduces, 
or offsets, the CSRS retirement benefit. This reduction is based on the 
value of the Social Security benefit earned during CSRS Offset service. 
For a person erroneously put in CSRS, CSRS Offset provides the benefit 
the person could reasonably have expected to receive without requiring 
a change in retirement saving behavior.
    The FERCCA disqualifies certain separated employees from making a 
choice between retirement plans. Separated employees whose retirement 
coverage error was previously discovered and corrected to FERS and 
later took a refund of FERS deductions or a distribution from the TSP, 
are not eligible to elect between FERS and CSRS Offset. Their coverage 
will remain FERS for the period of service affected by the retirement 
coverage error.
    Some individuals do not have a choice about their retirement 
coverage. If an individual should have had Social Security coverage 
during Federal employment, then he or she must have Social Security 
coverage in addition to Federal retirement coverage. In these cases, 
the FERCCA does not provide a choice about Social Security coverage. If 
an individual was incorrectly placed in CSRS rather than CSRS Offset, 
then the retirement coverage must be corrected to CSRS Offset. 
Likewise, if an individual was incorrectly placed in CSRS Offset 
instead of CSRS, then the retirement coverage must be corrected to 
CSRS. Although the individual cannot choose to keep Social Security 
coverage, the Social Security Administration will allow credit for all 
but the last 3 years before the retirement coverage was corrected.
    In addition, an employee who was erroneously excluded from 
retirement coverage under CSRS, CSRS Offset, or

[[Page 15607]]

FERS does not have an option under the FERCCA to remain excluded from 
retirement coverage.
    Errors where the employee is erroneously placed in FERS. In 1993, 
OPM published interim rules at 5 CFR 846.204(b)(2), for deemed 
elections of FERS coverage. These rules permit an employee erroneously 
in FERS during a time when the employee should have had an opportunity 
to elect FERS, the option of keeping the erroneous FERS coverage. The 
FERCCA does not affect these regulations. Those who had the opportunity 
to elect coverage under OPM's existing regulations at 
Sec. 846.204(b)(2) may not have another election opportunity based on 
the same retirement coverage error. In addition, OPM's regulation 
provides a choice between retirement plans regardless of the length of 
the error. The FERCCA also allows a choice in this situation regardless 
of the length of the error. However, the new provisions in subparts H 
and L of the new part 839 apply only if the error lasted for at least 3 
years of service after December 31, 1986.
    Lost earnings on employee make-up contributions to the TSP. The 
FERCCA provides lost earnings on make-up employee TSP contributions 
under certain circumstances. Employees who choose to make-up missed 
contributions to the TSP continue to be entitled to lost earnings on 
the make-up agency contributions they receive as a result of an agency 
error.
    Financial relief from costs associated with correcting a retirement 
coverage error. Under the FERCCA, individuals newly discovered to be in 
the wrong retirement plan are not responsible for paying any additional 
employee retirement deductions needed to correct a retirement coverage 
error. The FERCCA requires that any amount that should have been 
withheld as Social Security tax but was erroneously withheld as CSRS 
deductions must be treated as withheld Social Security tax. All the 
amounts required as Social Security tax, but wrongly treated as CSRS 
deductions during the error, are kept by the Government to the credit 
of Social Security.
    The Internal Revenue Code's 3-year statute of limitations on 
retroactive taxes applies to Social Security tax amounts that were not 
withheld during the period of the error. This means that, for an 
employee erroneously in CSRS, any Social Security taxes that should 
have been withheld from pay that was subject to Social Security taxes 
but not CSRS deductions (such as overtime or awards), must be collected 
from the employee, but not for periods beyond the 3-year statute. 
However, OPM has the authority under the FERCCA to reimburse an 
employee for payments of Social Security taxes that were not withheld 
because of a retirement coverage error.
    Reimbursement for certain expenses related to the error. The FERCCA 
allows OPM to reimburse certain expenses related to a retirement 
coverage error. Claimed losses related to forgone contributions and 
earnings in the TSP (except for lost earnings on employee make-up 
contributions to the TSP payable under subpart J of the new part 839) 
or other investment opportunities are not reimbursable under the 
FERCCA. The payments, if approved, are made from the Civil Service 
Retirement and Disability Fund.
    In addition, OPM may waive repayment of settlements employees 
received after suing for damages from a coverage error. If an employee 
has settled a dispute over having been forced retroactively into FERS, 
the employee generally should not keep the amount received and regain 
CSRS Offset benefits under the FERCCA. However, if the employee can 
show that getting CSRS Offset coverage does not fully compensate him or 
her, the FERCCA authorizes OPM to allow the CSRS Offset election with 
partial or no repayment of the settlement.
    Credit for service that was not subject to retirement deductions. 
Individuals may have civilian service that was not subject to 
retirement deductions (nondeduction service), and perhaps military 
service, performed before the error in retirement coverage. The amount 
of the deposit for nondeduction and military service depends on the 
individual's retirement coverage. Under FERS deposit rules, the deposit 
is 1.3 percent of basic pay for civilian service or 3 percent for 
military service, plus interest. Under CSRS rules, the deposit for both 
civilian and military service is 7 percent of basic pay, plus interest. 
Therefore, a retirement coverage error can cause a significant increase 
in the deposit an individual expected to pay for nondeduction and 
military service.
    If a retirement coverage error led to a deposit being erroneously 
computed under FERS rules, when it should have been computed under CSRS 
rules, the FERCCA allows credit for the service without actual payment 
of the deposit. The balance of the deposit owed at retirement forms the 
basis for an actuarial reduction in the retirement or survivor benefit. 
The deposit is considered paid by a life-time reduction in the benefit. 
This provision applies to all deposits that are computed under CSRS 
rules rather than FERS rules because of a retirement coverage error, 
regardless of the length of the error.

Analysis

    Section 831.205 requires that any future placement in CSRS will 
have to be approved by OPM in situations where a CSRS employee has had 
a break in CSRS service of more than 1 year.
    Sections 831.301 and 831.303 provide a new method for payment of 
certain deposits for civilian and military service. The FERCCA permits 
credit for certain types of service that are not subject to retirement 
deductions without actual payment of a service credit deposit. The 
deposit requirement may be satisfied instead by an actuarial reduction 
in the annuity that continues for the life of the retiree or survivor. 
This alternative is also available to individuals whose errors lasted 
for less than 3 years of service. It applies to individuals who owed a 
FERS deposit, and because of a retirement coverage error, learn that 
the deposit must be computed under CSRS rather than FERS rules.
    A new part 839 is established in question-and-answer format.
    Section 841.604 is amended to allow OPM to pay interest to 
individuals who overpaid the amount of a service credit deposit because 
of a retirement coverage error. Interest is payable only if the error 
lasted for at least 3 years of service after December 31,1986.
    Section 846.204(b)(2) is amended to clarify that this section 
(concerning deemed elections of FERS coverage) applies only to errors 
lasting for less than 3 years of service. If the error lasted for at 
least 3 years of service, then it is corrected in accordance with the 
newly established part 839.

Waiver of General Notice of Proposed Rulemaking

    Under section 553(b)(3)(B) and (d)(3) of title 5, United States 
Code, I find that good cause exists for waiving the general notice of 
proposed rulemaking and for making these rules effective in less than 
30 days. These regulations will affect the operation of all Federal 
agencies on and after March 19, 2001. Publication of a general notice 
of proposed rulemaking would be contrary to the public interest because 
it would delay the intended relief provided to individuals harmed by a 
retirement coverage error.

Regulatory Flexibility Act

    I certify that this rule will not have a significant economic 
impact on a substantial number of small entities because the rule only 
affects Federal employees, agencies, and benefits

[[Page 15608]]

payments to retired Federal employees and their survivors.

Executive Order 12866, Regulatory Review

    This rule has been reviewed by the Office of Management and Budget 
in accordance with Executive Order 12866.

List of Subjects

5 CFR Part 831

    Administrative practice and procedure, Alimony, Claims, Disability 
benefits, Firefighters, Government employees, Income taxes, 
Intergovernmental relations, Law enforcement officers, Pensions, 
Reporting and recordkeeping requirements, Retirement.

5 CFR Part 839

    Administrative practice and procedure, Annuities, Claims, 
Employment, Employment taxes, Government employees, Pensions, Reporting 
and recordkeeping requirements, Retirement, Social Security.

5 CFR Part 841

    Administrative practice and procedure, Air traffic controllers, 
Claims, Disability benefits, Firefighters, Government employees, Income 
taxes, Intergovernmental relations, Law enforcement officers, Pensions, 
Retirement.

5 CFR Part 846

    Administrative practice and procedure, Air traffic controllers, 
Firefighters, Government employees, Law enforcement officers, Pensions, 
Retirement.

Office of Personnel Management.
Steven R. Cohen,
Acting Director.

    For the reasons stated in the preamble, the Office of Personnel 
Management amends 5 CFR parts 831, 841, and 846 and adds part 839, as 
follows:

PART 831--RETIREMENT

    1. The authority citation for part 831 is revised to read as 
follows:

    Authority: 5 U.S.C. 8347; Sec. 831.102 also issued under 5 
U.S.C. 8334; Sec. 831.106 also issued under 5 U.S.C. 552a; Sec. 
831.108 also issued under 5 U.S.C. 8336(d)(2); Sec. 831.114 also 
issued under 5 U.S.C. 8336(d)(2) and section 7001 of Pub. L. 105-
174, 112 Stat. 58; Sec. 831.201(b)(1) also issued under 5 U.S.C. 
8347(g); Sec. 831.201(b)(6) also issued under 5 U.S.C. 7701(b)(2); 
Sec. 831.201(g) also issued under sections 11202(f), 11232(e), and 
11246(b) of Pub. L. 105-33, 111 Stat. 251; Sec. 831.201(g) also 
issued under sections 7(b) and 7(e) of Pub. L. 105-274, 112 Stat. 
2419; Sec. 831.201(i) also issued under sections 3 and 7(c) of Pub. 
L. 105-274, 112 Stat. 2419; Sec. 831.204 also issued under section 
102(e) of Pub. L. 104-8, 109 Stat. 102, as amended by section 153 of 
Pub. L. 104-134, 110 Stat. 1321; Sec. 831.205 also issued under 
section 2207 of Pub. L. 106-265, 114 Stat. 784; Sec. 831.301 also 
issued under section 2203 of Pub. L. 106-265, 114 Stat. 780; Sec. 
831.303 also issued under 5 U.S.C. 8334(d)(2) and section 2203 of 
Pub. L. 106-235, 114 Stat. 780; Sec. 831.502 also issued under 5 
U.S.C. 8337; Sec. 831.502 also issued under section 1(3), E.O. 
11228, 3 CFR 1964-1965 Comp. p. 317; Sec. 831.663 also issued under 
5 U.S.C. 8339(j) and (k)(2); Secs. 831.663 and 831.664 also issued 
under section 11004 (c)(2) of Pub. L. 103-66, 107 Stat. 412; Sec. 
831.682 also issued under section 201(d) of Pub. L. 99-251, 100 
Stat. 23; subpart V also issued under 5 U.S.C. 8343a and section 
6001 of Pub. L. 100-203, 101 Stat. 1330-275; Sec. 831.2203 also 
issued under section 7001(a)(4) of Pub. L. 101-508, 104 Stat. 1388-
328.

Subpart B--Coverage

    2. Add Sec. 831.205 to subpart B to read as follows:


Sec. 831.205  CSRS coverage determinations to be approved by OPM.

    If an agency determines that an employee is CSRS-covered, the 
agency must submit its determination to OPM for written approval. This 
requirement does not apply if the employee has been employed in Federal 
service with CSRS coverage within the preceding 365 days.

Subpart C--Credit for Service

    3. Amend Sec. 831.301 to revise paragraph (a)(3)(ii) and the first 
sentence of paragraph (b)(3) to read as follows:


Sec. 831.301  Military service.

    (a) * * *
    (3) * * *
    (ii) For an employee, Member, or survivor who is entitled, or upon 
application would be entitled, to monthly old-age or survivors benefits 
under section 202 of the Social Security Act (41 U.S.C. 402) based on 
the individual's wages or self-employment income, the employee, Member, 
or survivor has completed a deposit in accordance with subpart U of 
this part, or the annuity has been reduced under Sec. 831.303(d), for 
each full period of such military service performed after December 
1956. If a deposit has not been completed or the annuity has not been 
reduced under Sec. 831.303(d), periods of military service performed 
after December 31, 1956 (other than periods of military service covered 
by military leave with pay from a civilian position), are excluded from 
credit from and after the first day of the month in which the 
individual (or survivor) becomes entitled, or upon proper application 
would be entitled, to Social Security benefits under section 202. 
Military service performed prior to January 1957 is included in the 
computation of the annuity regardless of whether a deposit is made for 
service after December 31, 1956.
* * * * *
    (b) * * *
    (3) The employee, Member, or survivor has completed a deposit in an 
amount equal to 7 percent of his or her basic pay under section 204 of 
title 37, United States Code, (plus interest, if any) or the annuity 
has been reduced under Sec. 831.303(d), for each full period of such 
military service performed after December 1956. * * *
* * * * *

    4. Amend Sec. 831.303 to add paragraph (d) to read as follows:


Sec. 831.303  Civilian service.

* * * * *
    (d)(1) Civilian and military service of an individual affected by 
an erroneous retirement coverage determination. An employee or survivor 
who owed a deposit under section 8411(c)(1)(B) or 8411(f) of title 5, 
United States Code (FERS rules) for:
    (i) Civilian service that was not subject to retirement deductions, 
or
    (ii) Military service performed after December 31, 1956, will 
receive credit for the service without payment of the deposit if, 
because of an erroneous retirement coverage determination, the service 
is subsequently credited under chapter 83 of title 5, United States 
Code (CSRS rules).
    (2)(i) The beginning monthly rate of annuity payable to a retiree 
whose annuity includes service credited under paragraph (d)(1) of this 
section and service creditable under CSRS rules that would not be 
creditable under FERS rules is reduced by an amount equal to the CSRS 
deposit owed, or unpaid balance thereof, divided by the present value 
factor for the retiree's age (in full years) at the time of retirement. 
The result is rounded to the next highest dollar amount, and is the 
monthly actuarial reduction amount.
    (ii)(A) The beginning monthly rate of annuity payable to a survivor 
whose annuity includes service credited under paragraph (d)(1) of this 
section is reduced by an amount equal to the CSRS deposit owed, or 
unpaid balance thereof, divided by the present value factor for the 
survivor's age (in full years) at the time of death. The result is 
rounded to the next highest dollar

[[Page 15609]]

amount, and is the monthly actuarial reduction amount.
    (B) The survivor annuity is not reduced if the employee annuity was 
reduced under paragraph (d)(2)(i) of this section.
    (3) For the purpose of paragraph (d)(2) of this section, the terms 
``present value factor'' and ``time of retirement'' have the same 
meaning as in Sec. 831.2202 of this chapter.

    5. Add part 839 to read as follows:

PART 839--CORRECTION OF RETIREMENT COVERAGE ERRORS UNDER THE 
FEDERAL ERRONEOUS RETIREMENT COVERAGE CORRECTIONS ACT

Subpart A--General Provisions
Sec.
839.101   What is the Federal Erroneous Retirement Coverage 
Corrections Act?
839.102   Definitions.
Subpart B--Eligibility

General Provisions

839.201   Do these rules apply to me?

Election Opportunity

839.211   If these rules apply to me because I had a qualifying 
retirement coverage error, can I choose which retirement plan I want 
to be in?
839.212   May I make a retirement coverage election if I received a 
refund of my retirement deductions after I was corrected to FERS?
839.213   May I make a retirement coverage election if I withdrew 
all or part of my TSP account after I was corrected to FERS?
839.214   Am I disqualified from making an election of retirement 
coverage under the FERCCA if I withdrew my TSP account after I 
retired under FERS?
839.215   May I make a retirement coverage election under the FERCCA 
if I received a payment as settlement of my claim for losses because 
of a qualifying retirement coverage error?

Previous Election Opportunity

839.221   If my qualifying retirement coverage error was that I was 
put into FERS by mistake and then, after the error was discovered, I 
chose my current retirement coverage, can I now make another 
election?

Court-Ordered Benefits for Former Spouses

839.231   Can I make an election if my former spouse is entitled to 
a portion of my retirement benefits by qualifying court order?
839.232   If a deceased employee's survivors include both a current 
spouse and a former spouse, or spouses who are eligible for survivor 
annuities, must all of them consent to an election of FERS?

Elections

839.241   Am I eligible to make an election under the FERCCA if I 
had a qualifying retirement coverage error and none of the 
conditions mentioned in 839.212 through 839.232 apply to me?
839.242   Do these rules apply to me if I had multiple errors?
Subpart C--Employer Responsibility to Notify Employees
839.301   What should I do if I am not sure whether I am or was in 
the wrong retirement plan?
839.302   Will my employer give me a written explanation?
839.303   Is my employer required to find employees with a 
retirement coverage error?
839.304   What if my employer does not notify me?
Subpart D--Retirement Coverage Elections for Errors That Were Not 
Previously Corrected

Erroneous CSRS or CSRS Offset

839.401   What can I elect if I was put in CSRS or CSRS Offset by 
mistake?

Erroneous FERS

839.411   What can I elect if I was put in FERS by mistake?
Subpart E--Retirement Coverage Elections for Errors That Were 
Previously Corrected

Moved Out of CSRS or CSRS Offset

839.501   What can I elect if my employer moved me out of CSRS or 
CSRS Offset?

Moved Out of FERS

839.511   What can I elect under the FERCCA if my employer put me 
into FERS by mistake and then I was not allowed to remain in FERS 
when the error was discovered?
Subpart F--Making an Election

General Provisions

839.601   How do I make an election?
839.602   What if I don't make an election?
839.603   Can I later change my election?
839.604   When is my election effective?

Time Limits

839.611   What are the time limits for making an election?
839.612   Can I make a belated election?

FERS Elections

839.621   Can I cancel my FERS election if I was in the wrong 
retirement plan at the time I elected FERS coverage and I have an 
election opportunity under the FERCCA?
839.622   Can I cancel my FERS election if my qualifying retirement 
coverage error was previously corrected and I now have an election 
opportunity under the FERCCA?
839.623   If I decide to keep the FERS election in effect, may I 
change the effective date of the FERS election?
Subpart G--Errors That Don't Permit an Election
839.701   Is it correct that even though I had a qualifying 
retirement coverage error under the FERCCA, I may not have a choice 
of retirement coverage?
839.702   How do these rules apply to me if I don't have an election 
right under the FERCCA, but I did have a qualifying retirement 
coverage error?
Subpart H--Adjusting Retirement Deductions and Contributions

Employee Retirement Deductions

839.801   Do I owe more money if I had a qualifying retirement 
coverage error and the employee retirement deductions for the new 
retirement plan are more than what I already paid?
839.802   If I was in CSRS during my qualifying retirement coverage 
error, paid in more than I would have paid as a CSRS Offset, Social 
Security-Only, or FERS employee and end up retroactively in one of 
those retirement plans, will I get a refund of the excess I had 
withheld from my pay?
839.803   If I am like the person in the previous question, but the 
amount I paid as deductions under CSRS is more than the amount of 
combined retirement deductions and Social Security taxes due for my 
new retirement coverage, will I get a refund of the excess?
839.804   If my qualifying retirement coverage error occurred while 
I was a reemployed annuitant, and I am later corrected retroactively 
to a different retirement plan, will I have to pay any additional 
amount for retirement deductions?

Employer Retirement Contributions

839.811   Does my employer owe more money if I had a qualifying 
retirement coverage error and the employer retirement contributions 
for my new retirement plan are more than what was already paid?
839.812   Will my employer get a refund if I had a qualifying 
retirement coverage error and the employer retirement contributions 
for my new retirement plan are less than what was already paid?

Records Correction

839.821   Who is responsible for correcting my records?
839.822   Which employer is responsible for submitting the employee 
and employer retirement deductions and contributions and correcting 
my records if I had different employers?
Subpart I--Social Security Taxes
839.901   When will my employer begin withholding Social Security 
taxes if I was erroneously in CSRS during my qualifying retirement 
coverage error and my corrected coverage will now require me to pay 
Social Security taxes?
839.902   Will my CSRS retirement deductions be used to pay the 
Social Security taxes for the period of the qualifying retirement 
coverage error if I was erroneously placed in CSRS and did not pay 
Social Security taxes?
839.903   What happens to the Social Security taxes I erroneously 
paid when my employer corrects my retirement coverage to CSRS?

[[Page 15610]]

Subpart J--Lost Earnings for Certain Make-up Contributions to the TSP
839.1001   Does the FERCCA allow me to increase my TSP account if I 
was in CSRS during my qualifying retirement coverage error and my 
correct coverage will be FERS?
839.1002   Will OPM compute the lost earnings if my qualifying 
retirement coverage error was previously corrected and I made TSP 
make-up contributions?
839.1003   How will OPM compute the amount of lost earnings?
839.1004   Are lost earnings payable if I separated or if the 
employee died?
Subpart K--Effect of Election

General Provisions

839.1101   How are my retirement benefits computed if I elect CSRS 
or CSRS Offset under this part?
839.1102   How are my retirement benefits computed if I elect FERS 
under this part?
839.1103   If my qualifying retirement coverage error started when I 
should have been placed under FERS automatically, but my agency put 
me in CSRS because I had some past service, will I get a CSRS 
component in my FERS annuity for the service before the error if I 
elect FERS?

Retirees and Survivors

839.1111   If I elect to change my retirement coverage under the 
FERCCA, can I change the election I originally made at retirement 
for survivor benefits?
839.1112   If I elect to change my retirement coverage under the 
FERCCA, can I retroactively revoke the waiver of military retired 
pay I made at retirement?
839.1113   If I elect to change my retirement coverage under the 
FERCCA, can I change my decision about making a deposit or redeposit 
for civilian or military service?
839.1114   Will OPM actuarially reduce my benefit if I elect to 
change my retirement coverage under these rules?
839.1115   What is an actuarial reduction?
839.1116   If, because of the change in my retirement coverage, I 
will owe larger deposits for military and civilian service credit, 
will I have to pay the additional deposit due or will OPM 
actuarially reduce my annuity?
839.1117   If I elect to change my retirement coverage under the 
FERCCA, can I get a refund of the service credit deposit I made and 
receive the actuarial reduction instead?
839.1118   Will my annuity be actuarially reduced because I had 
Government contributions in my TSP account?
839.1119   How is the actuarial reduction for TSP computed?

Survivor Benefits

839.1121   What is the Actuarial Reduction for the Basic Employee 
Death Benefit (BEDB)?
839.1122   Does receipt of a one-time payment of retirement 
contributions as a death benefit prevent me from electing CSRS 
Offset?
Subpart L--Discretionary Actions by OPM
839.1201   If I took legal action against my employer because of a 
qualifying retirement coverage error, can OPM reimburse me for 
expenses related to my legal actions?
839.1202   Can OPM waive repayment of a monetary award I received as 
resolution of the harm caused me by a qualifying retirement coverage 
error?
839.1203   Can OPM compensate me for my losses if I did not take any 
legal action against my employer, but did incur some expenses 
because of a qualifying retirement coverage error?
839.1204   On what basis will OPM review claims under this subpart?
839.1205   Does the Director of OPM review the claims?
839.1206   How do I submit a claim under this subpart?
Subpart M--Appeal Rights
839.1301   What if my employer determines my error is not subject to 
these rules?
839.1302   What types of decisions can I appeal?
839.1303   Are there any types of decisions that I cannot appeal?
839.1304   Is there anything else I can do if I am not satisfied 
with the way my error was corrected?

    Authority: Title II, Pub. L. 106-265, 114 Stat. 770.

Subpart A--General Provisions

839.101   What is the Federal Erroneous Retirement Coverage 
Corrections Act?
    (a) The Federal Erroneous Retirement Coverage Corrections Act 
(FERCCA) is Title II of Public Law 106-265, enacted September 19, 2000. 
The FERCCA addresses the problems created when employees are in the 
wrong retirement plan for an extended period.
    (b) Generally, you must be in the wrong retirement plan for at 
least 3 years of service after December 31, 1986, before the FERCCA 
applies to you. Depending on the type of error, the FERCCA provides:
    (1) A choice between retirement plans,
    (2) New rules for crediting civilian and military service that was 
not subject to retirement deductions,
    (3) Payment of lost earnings on employee make-up contributions to 
the Thrift Savings Plan, and
    (4) Payment of certain out-of-pocket expenses that are a direct 
result of a retirement coverage error.


839.102  Definitions.

    Agency means an executive agency as defined in section 105 of title 
5, United States Code; a legislative branch agency; a judicial branch 
agency; and the U.S. Postal Service and Postal Rate Commission.
    Agency automatic (1%) contributions means contributions made to a 
FERS participant's Thrift Savings Plan account by his or her employing 
agency under 5 U.S.C. 8432(c)(1) or (c)(3).
    Agency matching contributions means contributions made to a FERS 
participant's Thrift Savings Plan account by his or her employing 
agency under 5 U.S.C. 8432(c)(2).
    Annuitant means the same as Retiree.
    Basic Employee Death Benefit or BEDB means the FERS survivor 
benefit payable as a lump sum or over 36 months, described in 
Sec. 843.309 of this chapter.
    Board means the Federal Retirement Thrift Investment Board 
established under 5 U.S.C. 8472.
    CSRS means the Civil Service Retirement System, as described in 
subchapter III of chapter 83 of title 5, United States Code.
    CSRS component means the part of a FERS retirement benefit that is 
computed under CSRS provisions (see Sec. 846.304 of this chapter).
    CSRS Offset means the Civil Service Retirement System Offset plan, 
which is for employees whose service is subject to CSRS deductions and 
Social Security taxes, as described in 5 U.S.C. 8349.
    Employee means an employee or Member individual as defined in 
section 8331(1) and (2) or 8401(11) and (20) of title 5, United States 
Code. Employee includes an individual who has applied for retirement 
benefits, but not separated from service.
    Employee retirement deductions means the amount that is deducted 
from basic pay under section 8334(a) of title 5, United States Code, 
for CSRS employees; or section 8334(k) of title 5, United States Code, 
for CSRS Offset employees; or the portion of the normal cost of FERS 
coverage that is deducted from an employee's basic pay under section 
8422(a) of title 5, United States Code.
    Employer means, with respect to an employee, that individual's 
employing agency.
    Employer retirement contributions means the employer share of 
retirement contributions that are required payments to the Fund under 
sections 8334(a) and 8423(a) of title 5, United States Code.
    Former spouse means a living person who was married to you for at 
least 9 months.
    FERCCA means the Federal Erroneous Retirement Coverage Corrections 
Act.
    FERS means the Federal Employees' Retirement System, as described 
in chapter 84 of title 5, United States Code.
    Fund means the Civil Service Retirement and Disability Fund 
described in section 8348 of title 5, United States Code.

[[Page 15611]]

    Government contributions means agency automatic (1%) contributions 
and agency matching contributions.
    Lost earnings means earnings that you would have received had your 
make-up contributions to the Thrift Savings Fund been made during the 
period of the error when they should have otherwise been made.
    Make-up contributions means employee contributions to the Thrift 
Savings Plan that should have been deducted from a participant's basic 
pay earlier, but were not due to an employing agency error.
    MSPB means the Merit Systems Protection Board described in chapter 
12 of title 5, United States Code.
    OPM means the Office of Personnel Management.
    Present value factor has the same meaning as in Sec. 831.2202 or 
Sec. 842.702 of this chapter, as applicable.
    Previously corrected means a retirement coverage error that has 
been properly corrected before March 19, 2001.
    Qualifying court order has the same meaning as in Sec. 846.702 of 
this chapter, referring to court orders that affect CSRS or FERS 
payments following a divorce or legal separation.
    Qualifying retirement coverage error means an erroneous decision by 
an employee or agent of the Government as to whether Government service 
is CSRS covered, CSRS Offset covered, FERS covered, or Social Security-
Only covered that remained in effect for at least 3 years of service 
after December 31, 1986.
    Reemployed annuitant means a CSRS or FERS retiree who is reemployed 
under conditions that do not terminate the CSRS or FERS annuity. (See 
part 837 of this chapter for additional information on reemployed 
annuitants.)
    Retiree means a former employee or Member who is receiving, or 
meets the statutory age and service requirements for, an annuity under 
either CSRS or FERS. This includes individuals who meet the statutory 
requirements for benefits and chose to postpone the beginning date of 
the annuity under Sec. 842.204(c) or Sec. 842.212(b)(1)(ii) of this 
chapter (pertaining to FERS MRA+10 and FERS deferred benefits). Retiree 
does not include a current spouse, former spouse, child, or person with 
an insurable interest receiving a survivor annuity. An individual who 
has left Federal service after completing 5 years of service but has 
not reached the age at which annuity payments may begin is considered a 
``separated employee'' rather than a retiree.
    Retirement coverage means participation in CSRS, CSRS Offset, FERS, 
or Social Security-Only. Retirement coverage is shown on the 
Notification of Personnel Action (Standard Form 50) or other similar 
record of personnel actions.
    Retirement plan means the same as retirement coverage.
    Separated employee means a former employee or Member who has 
separated from service and who has not met all the requirements for 
retirement under CSRS or FERS.
    Social Security coverage means service as a Federal employee that 
is employment under section 210 of the Social Security Act (42 U.S.C. 
410) and is subject to Social Security taxes.
    Social Security-Only means coverage under Social Security without 
concurrent coverage under CSRS, CSRS Offset, or FERS.
    Social Security taxes means the Old Age, Survivors, and Disability 
Insurance taxes imposed on employees under section 3101(a) of the 
Internal Revenue Code of 1986 (31 U.S.C. 3101(a)) and on employers 
under section 3111(a) of the Internal Revenue Code of 1986 (31 U.S.C. 
3111(a)).
    Survivor means a person entitled to benefits under chapter 83 or 84 
of title 5, United States Code, based on the service of a deceased 
employee, separated employee, or retiree.
    Thrift Savings Plan or TSP means the Federal Retirement Thrift 
Savings Plan established by the Federal Employees' Retirement System 
Act of 1986, Pub. L. 99-335, 100 Stat. 514, which has been codified, as 
amended, primarily at 5 U.S.C. 8351 and 8401-8479.

Subpart B--Eligibility

General Provisions


839.201  Do these rules apply to me?

    (a) These rules apply to employees who had a qualifying retirement 
coverage error. For all purposes, a qualifying retirement coverage 
error must have lasted for at least 3 years of Federal service after 
December 31, 1986, as stated in the definitions section (Sec. 839.102). 
It does not matter whether you have left Federal service, retired, or 
have been reemployed as an annuitant, as long as you had a qualifying 
retirement coverage error. In addition, the survivor of an employee, 
separated employee, or retiree who had a qualifying retirement coverage 
error is also covered by these rules.
    (b) An error that lasted less than 3 years of Federal service after 
December 31, 1986, is not qualifying under the rules in this part.
    (c) For errors lasting less than 3 years that involve erroneous 
placement in FERS during a period that the employee was eligible to 
elect FERS, see Sec. 846.204(b) of this chapter for guidance.

Election Opportunity


Sec. 839.211  If these rules apply to me because I had a qualifying 
retirement coverage error, can I choose which retirement plan I want to 
be in?

    The FERCCA does not provide an election opportunity in all 
situations where there was a qualifying retirement coverage error. Even 
if your error is one that provides an election opportunity under the 
FERCCA, certain events may disqualify you from making an election under 
the FERCCA. If you had a qualifying retirement coverage error, your 
eligibility to choose your retirement plan may be affected by the 
situations described in the next seven questions.


Sec. 839.212  May I make a retirement coverage election if I received a 
refund of my retirement deductions after I was corrected to FERS?

    If your qualifying retirement coverage error was previously 
corrected to FERS and you then received a refund of your FERS 
retirement deductions, you are not allowed to elect retirement plan 
coverage under the FERCCA.


Sec. 839.213  May I make a retirement coverage election if I withdrew 
all or part of my TSP account after I was corrected to FERS?

    (a) You may not make a retirement coverage election if your 
qualifying retirement coverage error was previously corrected to FERS, 
and you later received one of the following TSP withdrawals:
    (1) A TSP annuity after separation from service, but before 
receiving a FERS annuity; or
    (2) A single payment or monthly payments after separation from 
service; or
    (3) An age-based in-service withdrawal.
    (b) If you received an automatic cashout of your TSP account after 
you separated (because your account balance was $3,500 or less), or if 
you received a financial hardship in-service withdrawal, you may make a 
retirement coverage election.


Sec. 839.214  Am I disqualified from making an election of retirement 
coverage under the FERCCA if I withdrew my TSP account after I retired 
under FERS?

    No, you may make an election of retirement coverage under the 
FERCCA if you made a TSP withdrawal as a retiree.

[[Page 15612]]

Sec. 839.215  May I make a retirement coverage election under the 
FERCCA if I received a payment as settlement of my claim for losses 
because of a qualifying retirement coverage error?

    You can make a retirement coverage election under the FERCCA if OPM 
waives repayment of the entire amount under Sec. 839.1202. If OPM does 
not waive the entire repayment, you must pay back the amount that OPM 
did not waive.

Previous Election Opportunity


Sec. 839.221  If my qualifying retirement coverage error was that I was 
put into FERS by mistake and then, after the error was discovered, I 
chose my current retirement coverage, can I now make another election?

    No, OPM regulations allow certain employees who were put in FERS in 
error to choose between remaining in FERS or being covered under their 
automatic retirement coverage. (See Sec. 846.204(b)(2) of this 
chapter). If you already had this opportunity to choose your retirement 
coverage; then you may not make an election of retirement coverage 
based on the same error under these rules.

Court-Ordered Benefits for Former Spouses


Sec. 839.231  Can I make an election if my former spouse is entitled to 
a portion of my retirement benefits by qualifying court order?

    Yes, but if you want to elect FERS you need your former spouse's 
consent to the election. If you are subject to a qualifying court order 
and want to elect FERS, the requirements in Sec. 846.722 of this 
chapter (Former Spouse's Consent to an Election of FERS Coverage) apply 
to you.


Sec. 839.232  If a deceased employee's survivors include both a current 
spouse and a former spouse, or spouses, who are eligible for survivor 
annuities, must all of them consent to an election of FERS?

    If the employee dies before making an election of retirement 
coverage under the FERCCA, all eligible potential survivors, that is, 
both the current and any former spouses, must consent to an election of 
FERS coverage. If they do not all consent, the election cannot be made.

Elections


Sec. 839.241  Am I eligible to make an election under the FERCCA if I 
had a qualifying retirement coverage error and none of the conditions 
mentioned in Sec. 839.212 through Sec. 839.232 apply to me?

    If you were in CSRS or CSRS Offset and should have been in FERS or 
Social Security-Only, or if you were in FERS and should have been in 
CSRS, CSRS Offset, or Social Security-Only, then you have an election 
opportunity. This is summarized in the following chart:

------------------------------------------------------------------------
            You are or were in:                  And you belong in:
------------------------------------------------------------------------
CSRS or CSRS Offset.......................  FERS.
CSRS or CSRS Offset.......................  Social Security-Only.
FERS......................................  Social Security-Only.
FERS......................................  CSRS.
FERS......................................  CSRS Offset.
------------------------------------------------------------------------

Sec. 839.242  Do these rules apply to me if I had multiple errors?

    You must be in the wrong retirement plan for at least 3 years of 
Federal service after December 31, 1986. You need not be in the same 
wrong retirement plan during the entire 3-year period. If you had more 
than one type of erroneous retirement coverage, then you will have a 
retirement plan election under these rules if one of the errors is of a 
type that qualifies you for an election.

Subpart C--Employer Responsibility to Notify Employees


Sec. 839.301  What should I do if I am not sure whether I am or was in 
the wrong retirement plan?

    (a) If you are an employee, your employer has your personnel 
records and will review them to determine whether an error has been 
made. Therefore, you should notify your employer's human resources 
office if you believe an error has been made in your case. Notify your 
current employer even if you believe the error occurred while you were 
employed at another agency.
    (b) If you are not currently employed by the Federal Government, 
you should notify OPM at: U.S. Office of Personnel Management, 
Retirement Operations Center, Post Office Box 45, Boyers, Pennsylvania 
16017. You can also contact us by electronic mail at [email protected]. 
Notify OPM regardless of whether you are a retiree, survivor, or 
separated employee.
    (c) You may also get additional information about the FERCCA and 
whether or not you qualify at: www.opm.gov/benefits/correction.


Sec. 839.302  Will my employer give me a written explanation?

    (a) Your employer must provide you with written notice of the 
error. The notice must include an explanation of the error, your 
options regarding the error, and any time limits that apply.
    (b) Your employer must inform you if they find that you do not have 
a retirement coverage error.


Sec. 839.303  Is my employer required to find employees with a 
retirement coverage error?

    The FERCCA requires your employer to take reasonable and 
appropriate measures to identify individuals affected by a qualifying 
retirement coverage error and notify them of their rights under the 
law.


Sec. 839.304  What if my employer does not notify me?

    (a) If your error has not previously been corrected, the 6-month 
time limit on making an election of retirement coverage under the 
FERCCA (see Sec. 839.611(a)) does not begin to run until you are 
notified of the error.
    (b) If your error was previously corrected, the 18-month time limit 
on making an election of retirement coverage ends on September 19, 
2002. Employers and OPM may extend the time limit if you were prevented 
from making a timely election due to a cause beyond your control (see 
Sec. 839.612).

Subpart D--Retirement Coverage Elections for Errors That Were Not 
Previously Corrected

Erroneous CSRS or CSRS Offset


Sec. 839.401  What can I elect if I was put in CSRS or CSRS Offset by 
mistake?

    If you were placed in CSRS or CSRS Offset due to a qualifying 
retirement coverage error and you should have been in FERS, you may 
elect CSRS Offset or FERS. If you were placed in CSRS or CSRS Offset 
due to a qualifying retirement coverage error and you should have been 
in Social Security-Only, you may elect CSRS Offset or Social Security-
Only. This is summarized in the following chart:

------------------------------------------------------------------------
           You are in:            And you belong in:    You may elect:
------------------------------------------------------------------------
CSRS............................  FERS..............  CSRS Offset or
                                                       FERS.
CSRS Offset.....................  FERS..............
CSRS............................  Social Security-    CSRS Offset or
                                   Only.               Social Security-
                                                       Only.
CSRS Offset.....................  Social Security-
                                   Only.
------------------------------------------------------------------------

Erroneous FERS


Sec. 839.411  What can I elect if I was put in FERS by mistake?

    If you were placed in FERS due to a qualifying retirement coverage 
error and you should have been in CSRS, you may elect FERS or CSRS. If 
you were placed in FERS due to a qualifying retirement coverage error 
and you should have been in CSRS Offset, you may elect FERS or CSRS 
Offset. If you were placed

[[Page 15613]]

in FERS due to a qualifying retirement coverage error and you should 
have been in Social Security-Only, you may elect FERS or Social 
Security-Only. This is summarized in the following chart:

------------------------------------------------------------------------
           You are in:            And you belong in:    You may elect:
------------------------------------------------------------------------
FERS............................  CSRS..............  FERS or CSRS.
FERS............................  CSRS Offset.......  FERS or CSRS
                                                       Offset.
FERS............................  Social Security-    FERS or Social
                                   Only.               Security-Only.
------------------------------------------------------------------------

Subpart E--Retirement Coverage Elections for Errors That Were 
Previously Corrected

Moved Out of CSRS or CSRS Offset


Sec. 839.501  What can I elect if my employer moved me out of CSRS or 
CSRS Offset?

    If you were moved out of CSRS or CSRS Offset due to a qualifying 
retirement coverage error and were placed in FERS, you may elect CSRS 
Offset or remain in FERS. If you were moved out of CSRS or CSRS Offset 
due to a qualifying retirement coverage error and were placed in Social 
Security-Only, you may elect CSRS Offset or remain in Social Security-
Only. This is summarized in the following chart:

------------------------------------------------------------------------
                                   And your coverage
          You were in:              was previously      You may elect:
                                     corrected to:
------------------------------------------------------------------------
CSRS............................  FERS..............  CSRS Offset or
                                                       FERS.
CSRS Offset.....................  FERS..............
CSRS............................  Social Security-    CSRS Offset or
                                   Only.               Social Security-
                                                       Only.
CSRS Offset.....................  Social Security-
                                   Only..
------------------------------------------------------------------------

Sec. 839.511  What can I elect under the FERCCA if my employer put me 
into FERS by mistake and then I was not allowed to remain in FERS when 
the error was discovered?

    An employee who was erroneously placed in FERS during a time when 
the employee should have had an opportunity to elect FERS is allowed to 
keep the erroneous FERS coverage. If the employee was given an 
opportunity to remain in FERS, then the employee is disqualified from 
making an election of retirement coverage under the FERCCA (see 
Sec. 839.221). If you were not allowed to remain in FERS and were 
placed in CSRS due to a qualifying retirement coverage error, you may 
elect FERS or remain in CSRS. If you were not allowed to remain in FERS 
and were placed in CSRS Offset due to a qualifying retirement coverage 
error, you may elect FERS or remain in CSRS Offset. If you were not 
allowed to remain in FERS and were placed in Social Security-Only due 
to a qualifying retirement coverage error, you may elect FERS or remain 
in Social Security-Only. This is summarized in the following chart:

------------------------------------------------------------------------
                                   And your coverage
          You were in:              was previously      You may elect:
                                     corrected to:
------------------------------------------------------------------------
FERS............................  CSRS..............  CSRS or FERS.
FERS............................  CSRS Offset.......  CSRS Offset or
                                                       FERS.
FERS............................  Social Security-    Social Security-
                                   Only.               Only or FERS.
------------------------------------------------------------------------

Subpart F--Making an Election

General Provisions


Sec. 839.601  How do I make an election?

    You may make your election using the form issued by OPM. If you are 
an employee, your employer will provide you with this form. If you are 
not a current employee, OPM will provide the form.


Sec. 839.602  What if I don't make an election?

    (a) If your qualifying retirement coverage error was not previously 
corrected and you fail to make an election within the time limit under 
Sec. 839.611(a), your retirement coverage is summarized in the 
following chart:

------------------------------------------------------------------------
                                                      You are considered
         If you are in:           And you belong in:   to have elected:
------------------------------------------------------------------------
CSRS or CSRS Offset.............  FERS..............  CSRS Offset.
FERS............................  CSRS, CSRS Offset   FERS.
                                   or Social
                                   Security-Only.
CSRS or CSRS Offset.............  Social Security-    CSRS Offset.
                                   Only.
------------------------------------------------------------------------

    (b) If your qualifying retirement covereage error was previously 
corrected and you fail to make an election within the time limit under 
Sec. 839.611(b), you are considered to have elected to remain in your 
current retirement plan.


Sec. 839.603  Can I later change my election?

    Your election is irrevocable once your employer or OPM processes 
it. If you do not make a timely election, the resulting coverage (see 
Sec. 839.602) is also irrevocable.


Sec. 839.604  When is my election effective?

    Your election is effective on the date that the retirement coverage 
error first occurred. This means that your election will be 
retroactive, or will change your retirement coverage for a period of 
service in the past.

Time Limits


Sec. 839.611  What are the time limits for making an election?

    (a) If your qualifying retirement coverage error was not previously 
corrected, you have 6 months from the date you receive notice of the 
error under Sec. 839.302 to make an election.
    (b) If your qualifying retirement coverage error was previously 
corrected, the time limit for making an election expires on September 
19, 2002.


Sec. 839.612  Can I make a belated election?

    (a) If you are an employee, your employer can waive the time limit 
for making an election if you request such a waiver in writing. The 
employer would have to determine that you exercised due diligence, but 
could not make an election within the time limit because of 
circumstances beyond your control.
    (b) Your employer's decision not to waive the time limit under this 
section must be in writing and include notice of your right to request 
OPM to reconsider the decision.
    (c) OPM can waive the time limit for separated employees, retirees, 
and survivors who exercised due diligence but could not make an 
election because of circumstances beyond their control if a request is 
submitted to OPM, and OPM concludes that a waiver is justified.

FERS Elections


Sec. 839.621  Can I cancel my FERS election if I was in the wrong 
retirement plan at the time I elected FERS coverage and I have an 
election opportunity under the FERCCA?

    If you were erroneously in CSRS, CSRS Offset, or Social Security-
Only at the time you elected FERS and you have an election opportunity 
under the FERCCA, you can choose whether you want the FERS election to 
remain in effect. However, you may not choose whether you want your 
FERS election to remain in effect if you chose FERS after your employer 
notified you that you were put in FERS by mistake (see Sec. 839.221).

[[Page 15614]]

Sec. 839.622  Can I cancel my FERS election if my qualifying retirement 
coverage error was previously corrected and I now have an election 
opportunity under the FERCCA?

    Yes, your FERS coverage election does not disqualify you from 
making a retirement coverage election under the FERCCA. You can choose 
whether you want the FERS election to remain in effect. However, you 
may not choose whether you want your FERS election to remain in effect 
if you chose FERS after your employer notified you that you were put in 
FERS by mistake (see Sec. 839.221).


Sec. 839.623  If I decide to keep the FERS election in effect, may I 
change the effective date of the FERS election?

    No, If you decide to keep FERS, the original FERS election will 
remain unchanged.

Subpart G--Errors That Don't Permit an Election


Sec. 839.701  Is it correct that even though I had a qualifying 
retirement coverage error under the FERCCA, I may not have a choice of 
retirement coverage?

    Under the FERCCA, the types of retirement coverage errors listed in 
Sec. 839.241 trigger a right to make a retirement coverage election. 
The following chart summarizes the types of errors that do not trigger 
an election right:

------------------------------------------------------------------------
                                                      Your coverage must
           You are in:            And you belong in:   be corrected to:
------------------------------------------------------------------------
CSRS Offset.....................  CSRS..............  CSRS.
CSRS............................  CSRS Offset.......  CSRS Offset.
Social Security-Only............  CSRS..............  CSRS.
Social Security-Only............  CSRS Offset.......  CSRS Offset.
Social Security-Only............  FERS..............  FERS.
------------------------------------------------------------------------

Sec. 839.702  How do these rules apply to me if I don't have an 
election right under the FERCCA, but I did have a qualifying retirement 
coverage error?

    After your retirement coverage is corrected to the proper plan, 
your retirement deductions will be adjusted in accordance with subpart 
H of this part and your Social Security taxes will be adjusted in 
accordance with subpart I of this part, if applicable. You may also 
file a claim for losses in accordance with subpart L of this part.

Subpart H--Adjusting Retirement Deductions and Contributions

Employee Retirement Deductions


Sec. 839.801  Do I owe more money if I had a qualifying retirement 
coverage error and the employee retirement deductions for the new 
retirement plan are more than what I already paid?

    (a) No, your employer is responsible for paying any additional 
amount to the Fund. Your employer will not bill you for any additional 
retirement deductions.
    (b) For qualifying retirement coverage errors corrected under this 
part, the rules at Sec. 831.111(b) of this chapter (pertaining to 
employee options when the employer fails to withhold CSRS or CSRS 
Offset retirement deductions) do not apply.


Sec. 839.802  If I was in CSRS during my qualifying retirement coverage 
error, paid into the Fund more than I would have paid as a CSRS Offset, 
Social Security-Only, or FERS employee, and end up retroactively in one 
of those retirement plans, will I get a refund of the excess I had 
withheld from my pay?

    CSRS Offset and FERS require employees to pay Social Security taxes 
in addition to retirement deductions. When you are retroactively 
changed under the FERCCA to CSRS Offset, FERS, or Social Security-Only, 
the deductions you paid in under CSRS will be used to pay both the 
amounts required for retirement deductions under CSRS Offset or FERS, 
as applicable to you, and also the Social Security taxes that you would 
have paid had you been in CSRS-Offset, FERS, or Social Security-Only.


Sec. 839.803  If I am like the person in the previous question, but the 
amount I paid as deductions under CSRS is more than the amount of 
combined retirement deductions and Social Security taxes due for my new 
retirement coverage, will I get a refund of the excess?

    Yes, either OPM or your employer, as appropriate, will issue the 
payment in accordance with OPM instructions.


Sec. 839.804  If my qualifying retirement coverage error occurred while 
I was a reemployed annuitant, and I am later corrected retroactively to 
a different retirement plan, will I have to pay any additional amount 
for retirement deductions?

    (a) If you (as a reemployed annuitant) were erroneously in CSRS and 
had retirement deductions withheld from pay, and later are corrected to 
CSRS Offset or FERS coverage, the amount erroneously withheld under 
CSRS will be used to pay the retroactive CSRS Offset or FERS retirement 
deductions and Social Security taxes.
    (b) If you (as a reemployed annuitant) were erroneously placed in 
CSRS and elected not to have retirement deductions withheld from pay, 
and later are corrected to CSRS Offset or FERS, your share of 
retroactive Social Security taxes will be treated as an overpayment of 
salary. If you are corrected to CSRS Offset, you may elect to have 
retirement deductions withheld from future salary as a reemployed 
annuitant and may also make a deposit to cover the retirement 
deductions for past service as a reemployed annuitant in accordance 
with Sec. 837.503(c) of this chapter. If you are corrected to FERS, 
your retirement deductions under FERS will be treated as an overpayment 
of salary.
    (c) If you (as a reemployed annuitant) were erroneously in CSRS 
Offset and had retirement deductions withheld from pay, and later are 
corrected to CSRS or FERS coverage, the amount erroneously withheld 
under CSRS Offset will be used to pay the retroactive CSRS or FERS 
retirement deductions. The employer is responsible for paying to the 
Fund any additional retirement deductions.
    (d) If you (as a reemployed annuitant) were erroneously placed in 
CSRS Offset and elected not to have retirement deductions withheld from 
pay, and later are corrected to CSRS, you may elect to have retirement 
deductions withheld from future salary as a reemployed annuitant and 
may also make a deposit to cover the retirement deductions for past 
service as a reemployed annuitant in accordance with Sec. 837.503(c) of 
this chapter. Your retirement deductions under CSRS will be treated as 
an overpayment of salary.
    (e) If you (as a reemployed annuitant) were erroneously placed in 
CSRS Offset and elected not to have retirement deductions withheld from 
pay, and later are corrected to FERS, your retirement deductions under 
FERS will be treated as an overpayment of salary.
    (f) A reemployed annuitant erroneously placed in FERS and later 
corrected to CSRS or CSRS Offset is considered to have elected 
retirement deductions as a reemployed annuitant under the corrected 
coverage. The employer is responsible for paying to the Fund any 
additional retirement deductions under the corrected retirement 
coverage.
    (g) If you have a salary overpayment, your employer will inform you 
of your rights regarding the overpayment.
    (h) These rules are summarized in the following chart:

[[Page 15615]]



----------------------------------------------------------------------------------------------------------------
                                         And retirement       And you are corrected
         Wrong coverage is:              deductions were               to                        Then
----------------------------------------------------------------------------------------------------------------
(1) CSRS...........................  Taken.................  CSRS Offset or FERS...   The erroneous CSRS
                                                                                      deductions are used to pay
                                                                                      the retroactive CSRS
                                                                                      Offset or FERS deductions
                                                                                      and Social Security taxes.
                                                                                      Retirement
                                                                                      deductions will continue
                                                                                      to be withheld from
                                                                                      salary.
                                                                                      Social Security
                                                                                      taxes must be withheld
                                                                                      from salary.
(2) CSRS...........................  Not taken.............  CSRS Offset...........   Retroactive Social
                                                                                      Security taxes are treated
                                                                                      as an overpayment of
                                                                                      salary.
                                                                                      You may elect to
                                                                                      have retirement deductions
                                                                                      withheld from future
                                                                                      salary.
                                                                                      Social Security
                                                                                      taxes must be withheld
                                                                                      from salary.
                                                                                      You may pay a
                                                                                      deposit to OPM for past
                                                                                      retirement deductions.
(3) CSRS...........................  Not taken.............  FERS..................   Retroactive Social
                                                                                      Security taxes are treated
                                                                                      as an overpayment of
                                                                                      salary.
                                                                                      Retirement
                                                                                      deductions and Social
                                                                                      Security taxes must be
                                                                                      withheld from salary.
                                                                                      Your retirement
                                                                                      deductions for past
                                                                                      service under FERS are
                                                                                      treated as an overpayment
                                                                                      of salary.
(4) CSRS Offset....................  Taken.................  CSRS or FERS..........   The erroneous CSRS
                                                                                      Offset deductions are used
                                                                                      to pay retroactive CSRS or
                                                                                      FERS retirement
                                                                                      deductions.
                                                                                      Retirement
                                                                                      deductions will continue
                                                                                      to be withheld from
                                                                                      salary.
                                                                                      Social Security
                                                                                      taxes must be withheld
                                                                                      from salary if correct
                                                                                      coverage is FERS.
                                                                                      Employer must pay
                                                                                      any additional amount of
                                                                                      retirement deductions.
(5) CSRS Offset....................  Not taken.............  CSRS..................   You may elect to
                                                                                      have retirement deductions
                                                                                      withheld from future
                                                                                      salary.
                                                                                      You may pay a
                                                                                      deposit to OPM for past
                                                                                      retirement deductions.
(6) CSRS Offset....................  Not taken.............  FERS..................   Your retirement
                                                                                      deductions for past
                                                                                      service under FERS will be
                                                                                      treated as an overpayment
                                                                                      of salary.
(7) FERS...........................  Taken.................  CSRS or CSRS Offset...   You are considered
                                                                                      to have elected retirement
                                                                                      deductions as a reemployed
                                                                                      annuitant under the
                                                                                      corrected coverage.
                                                                                      Employer must pay
                                                                                      any additional retirement
                                                                                      deductions due for past
                                                                                      service.
----------------------------------------------------------------------------------------------------------------

Employer Retirement Contributions


Sec. 839.811  Does my employer owe more money if I had a qualifying 
retirement coverage error and the employer retirement contributions for 
my new retirement plan are more than what was already paid?

    Yes, your employer must pay any additional retirement contributions 
to the Fund.


Sec. 839.812  Will my employer get a refund if I had a qualifying 
retirement coverage error and the employer retirement contributions for 
my new retirement plan are less than what was already paid?

    No, if you were erroneously in CSRS, CSRS Offset, or Social 
Security-Only, then a correction of a retirement coverage error will 
not reduce the employer retirement contribution owed. Also, the FERCCA 
states that an employer may not remove from the Fund FERS employer 
contributions when correcting a qualifying retirement coverage error 
under this part.

Records Correction


Sec. 839.821  Who is responsible for correcting my records?

    (a) Your current employer will correct your records in accordance 
with OPM instructions. Your employer must not delay correcting your 
records.
    (b) For former employees and retirees, the last employer will 
correct the records. For survivors, the employee's last employer will 
correct the records. If an employer no longer exists as an 
organization, and there is no successor agency, then OPM will correct 
the records.


Sec. 839.822  Which employer is responsible for submitting the employee 
and employer retirement deductions and contributions and correcting my 
records if I had different employers?

    Your current or most recent employer will be responsible for this 
purpose. Even if that employer was not involved in the retirement 
coverage error, it must issue corrected records for the entire period 
of the retirement coverage error.

Subpart I--Social Security Taxes


Sec. 839.901  When will my employer begin withholding Social Security 
taxes if I was erroneously in CSRS during my qualifying retirement 
coverage error and my corrected coverage will now require me to pay 
Social Security taxes?

    (a) If you are in CSRS by mistake and belong in CSRS Offset, FERS, 
or Social Security-Only, your employer must begin withholding Social 
Security taxes by changing your retirement coverage to CSRS Offset. 
Your employer must begin this withholding as soon as possible after the 
error is discovered.
    (b) Your employer will correct your retirement coverage back to the 
date the error first occurred once you are notified of the error and 
have an opportunity to make any elections that you are eligible to 
make.


Sec. 839.902  Will my CSRS retirement deductions be used to pay the 
Social Security taxes for the period of the qualifying retirement 
coverage error if I was erroneously placed in CSRS and did not pay 
Social Security taxes?

    (a) If your qualifying retirement coverage error was not previously 
corrected, the amount erroneously withheld for CSRS retirement 
deductions will be:
    (1) Used to pay your new retirement deduction amount; and
    (2) Applied toward any Social Security taxes you owe for the time 
you were in the wrong retirement plan.
    (b) You will get Social Security credit for all the time you were 
erroneously covered by CSRS. Your employer will send the Social 
Security Administration a record of your earnings for all the years you 
should have had Social Security coverage.

[[Page 15616]]

Sec. 839.903  What happens to the Social Security taxes I erroneously 
paid when my employer corrects my retirement coverage to CSRS?

    (a) Except for the last 3 years, the money you erroneously paid 
into Social Security will remain to your credit in the Social Security 
fund. The Social Security Administration will include all but those 
last 3 years in determining your eligibility for, and the amount of, 
future benefits.
    (b) The amount you paid into Social Security for the last 3 years 
will be used to help pay your CSRS retirement deductions.

Subpart J--Lost Earnings for Certain Make-up Contributions to the 
TSP


Sec. 839.1001  Does the FERCCA allow me to increase my TSP account if I 
was in CSRS during my qualifying retirement coverage error and my 
correct coverage will be FERS?

    The Board's error correction regulations (5 CFR 1605 of chapter VI) 
generally allow you to increase your TSP account through a schedule of 
make-up contributions to replace the missed employee contributions. In 
addition, the FERCCA allows certain employees who have completed a 
schedule of make-up contributions, or who plan to schedule make-up 
contributions, to receive lost earnings on those contributions under 
certain circumstances. Employees are (and have been) entitled to lost 
earnings on the make-up agency contributions they receive as a result 
of the correction of an agency error.


Sec. 839.1002  Will OPM compute the lost earnings if my qualifying 
retirement coverage error was previously corrected and I made TSP make-
up contributions?

    If you made contributions to the TSP after your qualifying 
retirement coverage error was previously corrected, OPM will compute 
the lost earnings on your make-up contributions to the TSP under the 
following circumstances:

------------------------------------------------------------------------
                                       And were
          You were in:                previously        And under these
                                     corrected to:     rules you elect:
------------------------------------------------------------------------
CSRS............................  FERS..............  FERS.
CSRS Offset.....................  FERS..............  ..................
Social Security-Only............  FERS..............  No election
                                                       required.
Social Security-Only............  CSRS..............  ..................
Social Security-Only............  CSRS Offset.......  ..................
------------------------------------------------------------------------

Sec. 839.1003  How will OPM compute the amount of lost earnings?

    (a) Lost earnings will generally be computed in accordance with the 
Board's lost earnings regulations (5 CFR 1606 of chapter VI). However, 
the FERCCA states that OPM may compute the lost earnings in an 
alternative manner if such a computation is not administratively 
feasible. The alternative manner will yield an amount that is as close 
as practicable to the amount computed under 5 CFR 1606 of chapter VI.
    (b) Your employer is required to submit to OPM all information 
required to compute the amount of lost earnings.


Sec. 839.1004  Are lost earnings payable if I separated or if the 
employee died?

    (a) Yes. If the TSP account is not withdrawn, the lost earnings are 
paid to the account.
    (b) If there is no TSP account at the time the lost earnings are 
payable, you or your survivors will receive the payment directly.

Subpart K--Effect of Election

General Provisions


Sec. 839.1101  How are my retirement benefits computed if I elect CSRS 
or CSRS Offset under this part?

    Unless otherwise stated in this part, your retirement benefit is 
computed as if you were properly put in CSRS or CSRS Offset on the 
effective date of the error. All the eligibility and benefit 
computation rules for CSRS or CSRS Offset apply to your retirement 
benefit.


Sec. 839.1102  How are my retirement benefits computed if I elect FERS 
under this part?

    OPM will compute your retirement benefit as if you were properly 
put in FERS on the effective date of the error. All the eligibility and 
benefit computation rules for FERS apply to your retirement benefit.


Sec. 839.1103  If my qualifying retirement coverage error started when 
I should have been placed under FERS automatically, but my agency put 
me in CSRS because I had some past service, will I get a CSRS component 
in my FERS annuity for the service before the error if I elect FERS?

    No, employees who should have been automatically placed in FERS 
(generally because they did not have 5 years of past service under CSRS 
rules) do not have a CSRS component in their future FERS benefit. All 
service must be treated as FERS service in this circumstance.

Retirees and Survivors


Sec. 839.1111  If I elect to change my retirement coverage under the 
FERCCA, can I change the election I originally made at retirement for 
survivor benefits?

    (a) Yes, if you elect to change your retirement coverage under the 
FERCCA, you will have an opportunity to change the election you made 
for survivor benefits.
    (b) If you elect less than the maximum survivor benefit, your 
spouse's consent is necessary in accordance with Sec. 831.614 or 
Sec. 842.603(a)(1) of this chapter, as applicable.


Sec. 839.1112  If I elect to change my retirement coverage under the 
FERCCA, can I retroactively revoke the waiver of military retired pay I 
made at retirement?

    Yes, you may retroactively change your decision regarding waiver of 
your military retired pay.


Sec. 839.1113  If I elect to change my retirement coverage under the 
FERCCA, can I change my decision about making a deposit or redeposit 
for civilian or military service?

    Yes, you or your survivor will have a new opportunity to decide 
whether to pay any deposits or redeposits.


Sec. 839.1114  Will OPM actuarially reduce my benefit if I elect to 
change my retirement coverage under these rules?

    Your annuity may be subject to three possible actuarial reductions 
under the FERCCA. These reductions may be required for an unpaid 
deposit (see Sec. 831.303(d) and Sec. 839.1116 of this chapter), for 
Government contributions in a TSP account (see Sec. 839.1118), or for a 
previous payment of the Basic Employee Death Benefit (see 
Sec. 839.1121).


Sec. 839.1115  What is an actuarial reduction?

    An actuarial reduction allows you to receive benefits without 
having to pay an amount due in a lump sum. OPM reduces your annuity in 
a way that, on average, allows the Fund to recover the amount of the 
missing lump sum over your lifetime. The actuarial reduction becomes a 
permanent reduction in your benefit. The amount of the reduction 
depends on your age and the amount of the lump sum you would otherwise 
have to pay at that time. To compute an actuarial reduction, OPM 
divides the lump sum amount by the present value factor for your age at 
retirement.


Sec. 839.1116  If, because of the change in my retirement coverage, I 
will owe larger deposits for military and civilian service credit, will 
I have to pay the additional deposit due or will OPM actuarially reduce 
my annuity?

    You can choose to pay the additional deposit amount. If you choose 
not to pay the deposit, OPM will actuarially reduce your annuity, as 
explained in 831.303(d) of this chapter.

[[Page 15617]]

Sec. 839.1117  If I elect to change my retirement coverage under the 
FERCCA, can I get a refund of the service credit deposit I made and 
receive the actuarial reduction instead?

    No, the FERCCA allows OPM to reduce an annuity by an actuarial 
reduction only for the deposit amount that remains unpaid.


Sec. 839.1118  Will my annuity be actuarially reduced because I had 
Government contributions in my TSP account?

    Retirees and survivors of deceased employees who received a 
Government contribution to their TSP account after being corrected to 
FERS and who later elect CSRS Offset under the FERCCA are allowed to 
keep the Government contributions, and earnings on the Government 
contributions in the TSP account. Instead of adjusting the TSP account, 
the FERCCA requires that the CSRS-Offset annuity be reduced 
actuarially.


Sec. 839.1119  How is the actuarial reduction for TSP computed?

    (a) The part of your TSP account on the date you retired that is 
Government contributions and earnings on those Government contributions 
forms the basis for the actuarial reduction. OPM will divide the 
Government contributions and earnings by the present value factor for 
your age (in full years) at the time you retired. OPM will then round 
the result to the next highest dollar amount, which will be the monthly 
actuarial reduction amount.
    (b) If a survivor annuity is the only benefit that is payable, the 
present value factor for the survivor's age at the time of death is 
used. The survivor benefit is not reduced for TSP if the retiree's rate 
was reduced.

Survivor Benefits


Sec. 839.1121  What is the Actuarial Reduction for the Basic Employee 
Death Benefit (BEDB)?

    If you received a BEDB under FERS and you elect CSRS Offset under 
these rules, you do not have to pay back the BEDB. Instead, the FERCCA 
requires that OPM actuarially reduce your survivor annuity. The 
reduction will be the amount of the BEDB divided by the present value 
factor for your age at the time of the employee's death. The result is 
rounded to the next highest dollar amount and is the monthly actuarial 
reduction amount. If you elected to receive the BEDB in installments 
rather than a lump sum, the lump-sum amount is used for the purpose of 
computing the actuarial reduction.


Sec. 839.1122  Does receipt of a one-time payment of retirement 
contributions as a death benefit prevent me from electing CSRS Offset?

    You may still elect CSRS Offset if otherwise eligible. OPM will 
collect the amount of the one-time death benefit from any survivor 
benefits that are payable.

Subpart L--Discretionary Actions by OPM


Sec. 839.1201  If I took legal action against my employer because of a 
qualifying retirement coverage error, can OPM reimburse me for expenses 
related to my legal actions?

    (a) The FERCCA allows OPM, in its sole discretion, to reimburse you 
for necessary and reasonable expenses you actually incurred while 
pursuing a legal or administrative remedy of your qualifying retirement 
coverage error.
    (b) Necessary and reasonable expenses include actual amounts paid 
for attorney fees, court costs, expert witness fees, and other 
litigation expenses.
    (c) You may not receive reimbursement under this section if you 
received a monetary award that compensated you for your litigation 
expenses.
    (d) You must support your request for reimbursement with evidence 
that supports your claim.
    (e) In determining what is a necessary and reasonable expense, OPM 
will consider:
    (1) The type and amount of the expense;
    (2) The circumstances that gave rise to the expense; and
    (3) Whether the expense is directly related to litigation 
concerning a retirement coverage error.


Sec. 839.1202  Can OPM waive repayment of a monetary award I received 
as resolution of the harm caused me by a qualifying retirement coverage 
error?

    (a) The FERCCA allows OPM, in its sole discretion, to waive 
repayment of all or part of a settlement payment or court-ordered 
payment if you can demonstrate that CSRS Offset coverage does not fully 
compensate you for your losses.
    (b) Your request for waiver must state why you believe waiver of 
repayment is appropriate and include any evidence that supports your 
request.


Sec. 839.1203  Can OPM compensate me for my losses if I did not take 
any legal action against my employer, but did incur some expenses 
because of a qualifying retirement coverage error?

    (a) The FERCCA allows OPM, in its sole discretion, to compensate 
you for a monetary loss that is a direct and proximate result of your 
retirement coverage error.
    (b) Monetary losses include payments of additional Social Security 
taxes, payment of additional retirement deductions, and other out-of-
pocket expenses that you incurred because of a retirement coverage 
error.
    (c) You must substantiate your claim for losses with any evidence 
that supports your request.
    (d) OPM cannot pay you for:
    (1) Claimed losses related to forgone contributions and earnings 
under the TSP, other than lost earnings on make-up contributions to the 
TSP as provided in subpart J of this part; and
    (2) Claimed losses related to any other investment opportunities.


Sec. 839.1204  On what basis will OPM review claims under this subpart?

    (a) OPM will base its decision on only the written record, 
including all of your submissions and other documentation in OPM's 
possession.
    (b) At OPM's discretion, OPM may request your employer to provide 
an administrative report. The report may include:
    (1) A description of the retirement coverage error;
    (2) A statement as to whether a settlement or other court-ordered 
award was made;
    (3) The employer's recommendation for resolution of the claim; and
    (4) Any other information your employer believes OPM should 
consider.
    (c) The burden of proof that the criteria for approving a 
reimbursement of expenses is on you.


Sec. 839.1205  Does the Director of OPM review the claims?

    The Associate Director for Retirement and Insurance and his or her 
delegatees have the authority to perform the Director's actions, as set 
out in this subpart (see section 2208 of the FERCCA).


Sec. 839.1206  How do I submit a claim under this subpart?

    (a) No specific form is required. Your request must be in writing 
and contain the following information:
    (1) It must describe the basis for the claim and state the dollar 
amount you seek to receive;
    (2) It must include your name, address, and telephone number;
    (3) It must include the name, address, and telephone number of your 
current or last employer;
    (4) It must be signed by you; and
    (5) It must include any information you believe OPM should 
consider, such as cancelled checks or other evidence of amounts you 
paid.

[[Page 15618]]

    (b) Send your claim to: Office of Personnel Management, Retirement 
and Insurance Service, ATTN: FC Section, Washington, DC 20415-3200

Subpart M--Appeal Rights


Sec. 839.1301  What if my employer determines my error is not subject 
to these rules?

    (a) Your employer must provide you with a written decision. The 
decision must include the reason for the decision, and notice of your 
right to appeal the decision to the MSPB.
    (b) If your employer determines that it cannot waive the time limit 
for making an election under Sec. 839.612, the decision must inform you 
of your right to ask OPM to review the decision. OPM will advise you in 
writing of your appeal rights following its review of your employer's 
decision.


Sec. 839.1302  What types of decisions can I appeal?

    (a) You can appeal to the MSPB a decision that affects your rights 
and interests under this part, except an OPM decision under subpart L 
(see Sec. 839.1303). Some examples of decisions are:
    (1) Your employer's determination that your error is not subject to 
these rules;
    (2) Your employer's determination that you are not eligible to 
elect retirement coverage under these rules; and
    (3) OPM's denial of your request for a waiver of the time limit for 
making an election.
    (b) You may not seek review of a decision under any employee 
grievance procedures, including those established by chapter 71 of 
title 5, United States Code, and 5 CFR part 771.


Sec. 839.1303  Are there any types of decisions that I cannot appeal?

    Yes, OPM's decisions under subpart L (Discretionary Actions by OPM) 
are final and conclusive and are not subject to administrative or 
judicial review.


Sec. 839.1304  Is there anything else I can do if I am not satisfied 
with the way my error was corrected?

    (a) Except for claims under subpart L (see Sec. 839.1303), and 
after exhausting your administrative remedies as set out in this 
subpart, you may bring a claim against the Government under section 
1346(b) or chapter 171 of title 28, United States Code.
    (b) You may also bring a claim against the Government under any 
other provision of law if your claim is for amounts not otherwise 
provided for under these rules.

PART 841--FEDERAL EMPLOYEES' RETIREMENT SYSTEM--GENERAL 
ADMINISTRATION

    6. The authority citation for part 841 is revised to read as 
follows:

    Authority: 5 U.S.C. 8461; Sec. 841.108 also issued under 5 
U.S.C. 552a; subpart D also issued under 5 U.S.C. 8423; Sec. 841.504 
also issued under 5 U.S.C. 8422; Sec. 841.507 also issued under 
section 505 of Pub. L. 99-335; subpart J also issued under 5 U.S.C. 
8469; Sec. 841.506 also issued under 5 U.S.C. 7701(b)(2); Sec. 
841.508 also issued under section 505 of Pub. L. 99-335; Sec. 
841.604 also issued under Title II, Pub. L. 106-265, 114 Stat. 780.

    7. Amend Sec. 841.604 to add paragraph (c) to read as follows:


Sec. 841.604  Interest on service credit deposits.

* * * * *
    (c) In the case of a retirement coverage error that was corrected 
under part 839 (pertaining to errors that lasted for at least 3 years 
of service after December 31, 1986) in which:
    (1) A CSRS service credit deposit was made; and
    (2) There is a subsequent retroactive change to FERS, the excess of 
the amount of the CSRS civilian or military service credit deposit over 
the FERS civilian or military deposit, together with interest computed 
under Sec. 842.305 of this chapter, shall be paid to the employee or 
annuitant. In the case of a deceased employee or annuitant, payment is 
made to the individual entitled to lump-sum benefits under subpart B of 
part 843 of this chapter.

PART 846--FEDERAL EMPLOYEES' RETIREMENT SYSTEM--ELECTIONS OF 
COVERAGE

    8. The authority citation for part 846 is revised to read as 
follows:

    Authority: 5 U.S.C. 8347(a) and 8461(g) and Title III of Pub. L. 
99-335, 100 Stat. 517; Sec. 846.201(b) also issued under 5 U.S.C. 
7701(b)(2) and section 153 of Pub. L. 104-134, 110 Stat. 1321; Sec. 
846.201(d) also issued under section 11246(b) of Pub. L. 105-33, 111 
Stat. 251; Sec. 846.201(d) also issued under section 7(e) of Pub. L. 
105-274, 112 Stat. 2419; Sec. 846.202 also issued under section 
301(d)(3) of Pub. L. 99-335, 100 Stat. 517; Sec. 846.204(b) also 
issued under Title II, Pub. L. 106-265, 114 Stat. 778; Sec. 846.726 
also issued under 5 U.S.C. 1104; subpart G also issued under section 
642 of Pub. L. 105-61, 111 Stat. 1272.

    9. Amend Sec. 846.204 to revise paragraph (b)(2)(i) and add 
paragraph (e) to read as follows:


Sec. 846.204  Belated elections and correction of administrative 
errors.

* * * * *
    (b) * * *
    (2)(i) Erroneous FERS coverage for a period of less than 3 years of 
service. For an employee, separated employee, or retiree whose 
employing agency erroneously determined that the individual was covered 
by FERS during the period under Sec. 846.201 when the individual was 
eligible to elect FERS, and the employing agency should have placed the 
individual in CSRS, CSRS Offset, or Social Security-Only, under 
conditions that would have included an opportunity to elect FERS 
coverage, and the employee, separated employee, or retiree remained in 
FERS for less than 3 years of service, the employee, separated 
employee, or retiree is deemed to have elected FERS coverage and the 
individual will remain covered by FERS, unless the individual declines 
under paragraph (b)(2)(ii) of this section to be covered by FERS.
* * * * *
    (e) Errors lasting for at least 3 years of service. For an 
employee, separated employee, or retiree whose employing agency 
erroneously determined that the individual was covered by FERS during 
the period under Sec. 846.201 of this chapter when the individual was 
eligible to elect FERS and the individual remained in FERS for at least 
3 years of service, the error is corrected in accordance with part 839 
of this chapter.
[FR Doc. 01-6805 Filed 3-16-01; 9:30 am]
BILLING CODE 6325-50-P