Salary and Benefits for Reemployed Annuitants

An annuitant is a person receiving a Civil Service Retirement System (CSRS) or Federal Employee Retirement System (FERS) or other Federal retirement system annuity. A reemployed annuitant is a person who retired, is receiving an annuity, and is rehired by the Federal Government.

Salary for Reemployed Annuitants

Generally, when an annuitant is reemployed, the annuity continues, and the amount of annuity that applies to the period of reemployment is offset from the reemployed annuitant's salary. Refer to Office of Personnel Management (OPM) CSRS and FERS retirement guides for exceptions to this rule.

The pay of a reemployed annuitant is subject to:

• Offset by the allocable amount of annuity during the period of reemployment; specifically, the amount paid to the annuitant is deducted from the amount paid by the Agency.
• Retirement deductions, if elected.

The Agency is responsible for paying the entire salary to the reemployed annuitant and remitting the offset amount to OPM for credit to the appropriate retirement fund.

The salary offset rules do not apply when a reemployed annuitant is approved for waiver of offset of pay/annuity under exceptional or unusual circumstances outlined in OPM’s CSRS and FERS retirement guides.

Processing the Offset

To process the offset in the NFC system, complete the following fields using Web-based Entry, Processing, Inquiry and Correction System (EPIC Web), EmpowHR or the Agency's Front-End System Interface (FESI) on the appointment personnel action:

• Annuitant Indicator – The status of an annuitant appointed to a position in the Federal civilian workforce. Valid values are found in OPM’s Guide to Data Standards or NFC’s Table System (TMGT) 025, AD-350 (Personnel Block and Description), field 053, Annuitant Indicator.
• Special Employment Program (EPIC Web and EmpowHR) or Spec-Employment-Pgms-Code (FESI). Valid value is 66/Reemployed Annuitant.
• Salary Share Code (EPIC Web and EmpowHR) or Coop-Annuit-Share-Code (FESI) - Identifies the source (e.g., OPM/CSRS or FERS) which shares with the Agency in paying the employee’s salary. When the employee is a reemployed annuitant, the Salary Share Code must be 3, 4, or 5. Valid values are:
  0 = Not Applicable
  1 = State Cooperator
  2 = Other Type of Cooperator
  3 = Annuitant Under CSRS or FERS
  4 = Annuitant and State Cooperator
  5 = Annuitant and Other Type of Cooperator
• Salary Share Amount (EPIC Web) or Coop Share Amt (EmpowHR or Civil-Ser-Annuitant-Share (FESI) - Identifies the portion of an employee’s salary which is being paid by the CSRS or the FERS fund. Complete the Salary Share Amount when the employee is a reemployed annuitant without a waiver from OPM by entering the annuity amount received by the reemployed annuitant. NFC automatically reduces the amount of the annual basic pay by the amount entered in this field and computes the amount to be paid. 

Processing Adjustments to Annuities

Reemployed annuitants receive annual cost of living adjustments to their annuities. This is in addition to the cost-of-living adjustment (COLA) that NFC automatically generates for the reemployed annuitant’s Federal salary.

Each Agency should have a process in place that reminds reemployed annuitants to provide updated copies of the COLA increase notifications to their annuities from OPM to the servicing Personnel Office Identifier (POI), to ensure their salaries are accurately offset. After receiving the documentation, the POI processes Nature of Action Code (NOAC) 917, Annuitant Adjustment with Legal Authority ZLM to update the Salary Share Amount field with the new annuity amount when the employee is a reemployed annuitant without a waiver from OPM.

Benefits for Reemployed Annuitants

Federal Employees' Group Life Insurance (FEGLI)

When the annuitant is reemployed under conditions that terminate the annuity, the life insurance carried as an annuitant is also terminated. There is no right to convert. The reemployed annuitant can get life insurance as an employee when the position is FEGLI eligible.

When the annuitant is reemployed, the annuity continues and the position is FEGLI eligible. The Basic insurance Option A and Option C carried as an annuitant are suspended; however, the reemployed annuitant automatically receives Basic as any other employee. Also, if enrolled as an annuitant, the reemployed annuitant automatically receives Option A and Option C insurance as an employee. If the reemployed annuitant waived FEGLI as an annuitant and is reemployed after a break in service of 180 days or more, the reemployed annuitant automatically gets Basic insurance (even if previously waived), and can elect any type of optional coverage or increase the multiples of optional coverage within 31 days of returning to service.

When the annuitant is reemployed in a position that does not exclude coverage, the reemployed annuitant is given the opportunity within 60 days of reemployment to choose whether to keep Option B as an annuitant or elect it as an employee.

To process the FEGLI election in the NFC system, complete the FEGLI Coverage Code using EPIC Web, EmpowHR or the FESI on the NOA 881C, FEGLI Chg, personnel action.

Federal Employees Health Benefits (FEHB)

When the reemployed annuitant is enrolled in FEHB as an annuitant and reemployed in Federal service in a position that conveys FEHB eligibility, the reemployed annuitant may participate in premium conversion and the enrollment can be transferred from the retirement system to the employing Agency. The FEHB premiums are deducted from the reemployed annuitant’s pay on a pre-tax basis as an employee. When the annuitant separates from reemployment, the payroll office for the employing Agency transfers enrollment back to the retirement system.

When the reemployed annuitant is not enrolled in FEHB as an annuitant but is reemployed in a position that conveys FEHB eligibility, the reemployed annuitant may enroll the same as any other new employee. The annuitant continues enrollment after separation from reemployment when the annuitant meets all the requirements that any other retiring employee must meet.

To process the FEHB election in the NFC system, enter the SF 2809, FEHB Election, using EPIC Web, EmpowHR or FESI.

Federal Employees Dental/Vision Program (FEDVIP)

When the reemployed annuitant is enrolled in FEDVIP as an annuitant and is reemployed in a position eligible for FEDVIP, the annuitant must contact BENEFEDS to elect premiums deducted as an employee. FEDVIP premiums paid by annuitants are post-tax dollars, whereas reemployed annuitants pay FEDVIP premiums with pre-tax dollars.

When the reemployed annuitant is not enrolled in FEDVIP, and the position is eligible for enrollment, the employee may enroll as a newly hired/newly eligible employee within 60 days of reemployment.

Flexible Spending Accounts

As a reemployed annuitant, the annuitant is eligible to enroll as an employee in the Flexible Spending Account Program (FSAFEDS) for health care and/or an Agency supported dependent care account 60 days after reemployment. For the FSAFEDS account, the reemployed annuitant’s position must be eligible to enroll in FEHB.

Long Term Care

A reemployed annuitant may continue Federal Long Term Care Insurance Program (FLTCIP) coverage based on payment of premium. Deductions can be paid through the individual’s annuity or employee salary.