Labor Department to offer early retirements

Labor Department employees will get the opportunity to take early retirements beginning March 1, according to a memo issued by Labor Secretary Elaine Chao, who touted the measure as a means to fully implement President Bush's five-point management agenda.

"Early outs" are a means of reducing the size of the government during agency reorganizations or budget reductions while avoiding involuntary layoffs. In 1999, Congress granted OPM permanent authority to allow agencies to offer early retirement.

The Labor Department will offer early retirements from March 1 to Sept. 30. About 4,000 employees are eligible.

"We're providing options to employees as well as trying to make sure that the administration's efforts on workforce restructuring are able to proceed," said Patrick Pizzella, assistant secretary for administration and management at the Labor Department.

The Labor Department's efforts tie in to the president's management agenda because Office of Management and Budget Director Mitch Daniels has asked agency heads to develop workforce restructuring plans to better match staff to their organizations' missions. The move is part of the Bush administration's overall effort to shape a federal workforce that is less top-heavy and relies more on work provided from the private sector.

Employees are eligible for early retirement if they are at least 50 years old with 20 years of service, or if they are any age with 25 years of service. Employees under the Civilian Service Retirement System (CSRS) must have served in a CSRS-covered position for at least one of the last two years before retirement. Annuities for CSRS employees who take early outs will be reduced by 2 percent per year until age 55. Annuities for employees covered by the Federal Employees Retirement System will not be reduced.

Chao said Labor would not offer cash incentives to employees who opt for early retirement.

Other workforce restructuring measures were proposed in the department's 2003 budget. One proposal would eliminate 373 "unnecessary" management positions in compliance with the president's de-layering effort. The budget also called for the consolidation of five public affairs offices, which would eliminate an additional nine positions.

According to Pizzella, some of the positions have been unfilled for the past year.

Consolidating public affairs offices will allow the department to get "the most bang for the buck regarding public affairs efforts," Pizzella said.

The early-out measure follows Chao's move to establish a new performance system for the Labor Department's 2,100 senior executives, managers and supervisors. Chao also raised the bar for senior executives' bonuses and revived a dormant senior executive development program. Executives can now get bonuses of up to 7.5 percent of their salaries, up from 5 percent. Some experienced managers will be groomed for the Senior Executive Service.

"We have many SESers eligible to retire," Pizzella explained. "We want to seek out those GS-14 and 15s who would want to enroll in a program where at the end of it, they can be qualified to enter the SES."