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Facing Disability

How your benefits and retirement can be affected if you become sick or injured.

"Phillip" is 52 years old and has saved up more than 1,500 hours of sick leave since he first started working for the federal government almost 30 years ago. He has been diagnosed with cancer. He hopes that with treatment, it will go into remission, but during chemotherapy, he is weak and is unable to come to work on most days.

"Bill," a federal employee since 1998, recently was diagnosed with an illness that affects his vocal chords. He loses his voice when he talks for periods of five minutes or longer. Without the use of his voice, Bill can't do his job, which involves presenting information to contractors regarding the needs of his agency. The damage to his vocal chords is permanent and the prognosis is that his illness will worsen over time.

"Pam" was delivering mail on her route when she slipped on a patch of ice and broke her arm.

All three of these examples illustrate situations when employees will need to use one of the benefits offered by the federal government to cover situations where their ability to work is impaired by illness or injury. Phillip will need to use his sick leave to cover time away from work during his cancer treatment. He does not need to consider disability retirement yet, since he has so much sick leave saved up. He is still three years from being eligible for regular retirement benefits under the Civil Service Retirement System. If he eventually decides to apply for disability retirement, he will receive a benefit based on his years of service and his current high-three average salary. If he does not recover from his illness and dies while a federal employee, his spouse and dependent children will receive CSRS survivor benefits.

In Bill's case, if he's unable to perform "useful and efficient service" in his current job, he may need to file for disability retirement under CSRS or the Federal Employees Retirement System. (He may also qualify for Social Security disability benefits.) However, if his agency offers him a position that accommodates his disability at the same grade or pay level within his commuting area, and he turns it down, he will not be considered disabled.

Pam must file a claim for workers compensation, since her injury occurred while she was performing her duties as a mail carrier.

As these examples show, federal employees have a variety of benefits available if they become temporarily or permanently disabled. Let's look at each.

Sick Leave

Full-time federal employees accrue four hours of sick leave every two weeks. Sick leave accumulates throughout a career, and there are no limits on the amount that can be carried over from year to year. Over 20 years of service, an employee can accrue as much as a year of sick leave.

Employees would be wise to look at this leave as a very valuable short-term disability policy that can provide a full salary without the stress associated with a period of leave without pay or a need to tap into an agency's leave bank.

Agencies can set time limits on when employees must request sick leave -- including requiring advance approval for sick leave for their own or a family member's medical, dental or optical examination or treatment.

Here's an Office of Personnel Management fact sheet on sick leave.

Disability Retirement

OPM defines disability retirement as "a benefit provided to protect an employee who is no longer able to provide useful and efficient service in his or her current grade or pay level because of a medical condition." Disability retirement should be a last resort and is appropriate only when reasonable efforts to preserve a person's employment have failed. If attempts to retain the employee in a productive capacity are unsuccessful, and the employee decides to apply for disability retirement, the agency must assist the employee in filing an application with OPM.

Under disability retirement, an employee is considered separated from federal service and is not expected to return to work. OPM has the right to request periodic medical reviews of those taking disability retirement until the annuitant turns 60. If he or she recovers from the disabling condition, then the benefit will stop one year after the medical evaluation or upon re-employment, if that occurs first.

OPM offers fact sheets about disability retirement under CSRS and FERS.

Workers Compensation

The Federal Employees' Compensation Act provides benefits to civilian federal employees for disability due to injury sustained while in the performance of job duties, and for employment-related disease.

Benefits include rehabilitation, medical, surgical and necessary expenses. FECA provides compensation to dependents if the injury or disease causes the employee's death.

FECA is administered by the Office of Workers' Compensation Programs at the Labor Department.

Injured employees are entitled to continuation of pay from their employing agency for up to 45 days of disability. If the disability continues for longer than that, then compensation for lost wages is payable after a three-day nonpaid waiting period. No waiting period is required, however, if the disability causing the wage loss lasts longer than 14 days from the time compensation begins. Injured employees also have the option of using sick leave if it is to their benefit.

FECA also provides compensation benefits based on loss of earnings capacity and schedule awards for the loss or loss of use of specified parts and functions of the body when there are permanent effects of a job-related injury.

If the employee has no dependents, compensation generally is payable at the rate of two-thirds of pre-disability gross wages tax-free; if the employee has one or more dependents, compensation is payable at the rate of three-fourths of pre-disability gross wages, tax-free. Employees who apply for permanent compensation may also apply for disability retirement under CSRS or FERS, although they cannot receive both workers' comp and disability retirement at the same time. Here's a OPM publication on the relationship between compensation and disability retirement.

Tammy Flanagan is the senior benefits director for the National Institute of Transition Planning Inc., which conducts federal retirement planning workshops and seminars. She has spent 25 years helping federal employees take charge of their retirement by understanding their benefits.