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Key developments in the world of federal employee benefits: health, pay, and much more.
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An End to Fitness Perks for Some Feds, Another Scam Targeting Retirees and More

Officials at the Office of Personnel Management are warning federal workers and retirees about another scam targeting their annuities.

Last week, OPM posted on its website that companies are “aggressively” targeting federal retirees with an offer of a cash payment in exchange for some or all of someone’s future annuities. The cash payment offered is generally much less than the long-term value of the annuities, and comes with high interest rates and fees.

One such company is already under investigation by the Consumer Financial Protection Bureau, the OPM inspector general reported.

CFPB offered advice to retirees when faced with questionable loan or cash-for-annuity offers: Avoid loans with high fees and interest. Don’t sign over control of your benefits. And don’t buy life insurance that you don’t want or need—something pension advance companies sometimes require from consumers.

If you are targeted by one of these companies, contact OPM’s Office of the Inspector General at 877-499-7295. You can also report suspected scams via mail at OPM Office of the Inspector General, 1900 E St. NW Room 6400, Washington, D.C. 20415, or submit a complaint form online.

On Capitol Hill, two Virginia lawmakers have introduced a...

VA Reform Heads to Trump, a New Program for Sexual Assault Survivors and More

A bipartisan bill that would expedite the firing of employees at the Veteran Affairs Department is poised to become law after the House voted 368-55 Tuesday to send the measure to President Trump’s desk.

As Eric Katz reported, House leaders are touting the Department of Veterans Affairs Accountability and Whistleblower Protection Act as a “significant step forward” for civil service reform. The bill would allow the VA secretary to fire, suspend or demote an employee with just 15 days’ notice, and employees could appeal to the Merit Systems Protection Board albeit through an expedited process.

Although the bill is more friendly to employees than previous VA reform efforts, groups like the American Federation of Government Employees and the Senior Executives Association opposed the measure, arguing it erodes feds’ due process rights.

Meanwhile, the Defense Department on Monday launched an online learning program to help service members who were victims of sexual assault to recover and heal from their ordeals.

The self-guided program, available through computer Web browsers and on mobile devices and called “Building Hope and Resiliency: Addressing the Effects of Sexual Assault,” provides information about coping mechanisms, relaxation exercises, as well as links to other resources and referrals...

Ineffective Use of Early Retirement Offers, FEHBP for All and More

Buyouts and early retirement offers are likely to become more prevalent as federal agencies absorb budget cuts and work to meet the Trump administration’s goal of reducing the federal workforce. But at least one agency needs to brush up on using separation incentives more effectively. A recent Small Business Administration effort to reshape its workforce through early retirement and buyouts was not successful in achieving any of its goals, according to a report last week by the agency’s inspector general.

In fiscal 2014, SBA requested the authority to use early retirements through the Voluntary Early Retirement Authority and Voluntary Separation Incentive Payment program in order to address workforce skill gaps, increase the population of early-career employees and address budgetary constraints.

But according to the agency’s IG, the plan to implement early retirements lacked measurable objectives, included inaccurate information, and failed to act on proposals from a consulting firm to change the SBA’s service model.

As a result, SBA spent $2.1 million for employees to retire early, only to keep those positions largely the same. Of 149 positions vacated through the program, 54 were filled without meaningful changes to the occupants’ responsibilities or job descriptions.

The...

Thrift Savings Plan Board Approves Five-Year Lifecycle Fund Increments

The panel that oversees the retirement savings plan for federal employees on Wednesday unanimously approved offering lifecycle funds targeted to within five years of participants’ expected retirement date rather than the current 10-year increments.

A report on the TSP’s investment options by consultants at Aon Hewitt recommended following a trend in private 401(k) providers to offer lifecycle funds – which move investors to a more conservative portfolio as they near their anticipated retirement date -- on a five-year basis.

“Most have been moving to five-year increments,” Bill Ryan, a partner at the firm, told the Federal Retirement Thrift Investment Board. “It helps bridge the gap for participants, and it’s easier to figure out where to place someone based on their age.”

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The TSP will implement the new L Fund increments in 2020.

Aon Hewitt also recommended that the TSP’s I Fund, which is made up of international stocks and bonds, be diversified to include stocks in Canada, emerging markets, and international small-cap markets.

“These are large markets to which we have no exposure,” Ryan said. “By adding these, we would improve the risk...

Proposed Compensation Cuts, Guaranteed Uber Reimbursement and More

With the roll-out of President Trump’s fiscal 2018 budget proposal this week, there is no shortage of news outlining its potential effect on federal workers.

As expected, the proposal offers a 1.9 percent pay hike for civilian employees and a 2.1 percent raise for military service members. But those increases would be coupled with efforts to reduce civilian workers’ retirement benefits, a move panned by most unions and employee groups.

Among the measures to rein in retirement spending are a phased-in increase in the employee contribution to the Federal Employees Retirement System, an elimination of cost of living adjustments for FERS retirees and a 0.5 percent COLA reduction for Civil Service Retirement System employees.

In all, the budget proposes $1.4 trillion in cuts to non-Defense agencies over the next decade, including $54 billion in discretionary spending at domestic agencies next year. That means cutting jobs at most agencies. In case you missed it, we made a chart outlining the proposed staffing changes at each agency in Trump’s first budget.

The spending blueprint also would make it easier to fire poor performers. As Eric Katz reported:

“[Outdated rules and processes governing the federal personnel system...