One Reason to Save Your Vacation Time

By Amanda Palleschi

April 26, 2012

Capitol Hill has been buzzing with debate over proposals that affect federal employees. Amid all the discussions, the House Oversight and Government Reform Committee managed to squeeze in a few potential changes to Thrift Savings Plan policies.

The panel last week amended a retirement bill to allow federal and postal employees to deposit unused annual leave into their Thrift Savings Plan accounts upon retirement.

“This option has already been available to private sector employees with 401(k) plans since 2009,” said Rep. Stephen Lynch, D-Mass., sponsor of the provision. “This amendment would give federal employees the chance to work on rebuilding their TSP accounts to make up for losses they suffered during the financial crisis.”

The committee unanimously approved the overall bill, which allows federal employees to ease into retirement by working part time.

Retirement Funds as Leverage

The oversight committee also passed a measure that would allow the Internal Revenue Service to enforce federal tax levies on civil servants. The provision was included in the version of the surface transportation measure the Senate passed in March, and was the subject of some confusion.

The IRS claimed it could levy funds in Thrift Savings Plan accounts, but the board overseeing the retirement plan believed it was illegal to use funds credited to TSP beneficiaries for anything that did not help them. The Federal Retirement Thrift Investment Board sought clarification on the law.

“There has been a conflict between the IRS and TSP over this issue for many years,” said Kim Weaver, the board’s external affairs director. But a 2010 Justice Department opinion found that TSP accounts are subject to federal tax levies, and the board now has reached an understanding with lawmakers.

“We are appreciative that the committee acted to provide this clarification,” Weaver said.

(B)(1) Bargaining Update

In February, we reported agencies were testing (b)(1) bargaining issues -- personnel matters not currently required to be up for negotiation with public sector unions.

A report on the pilot program, which the Office of Personnel Management’s Labor and Management Relations Council commissioned, is slated to land on President Obama’s desk in May. Nine federal agencies conducted 12 pilot projects on the feasibility of bargaining over (b) (1) issues, which include numbers, types and grades of employees; and methods, means and technology used for doing an organization’s work. This type of bargaining was practiced under the Clinton administration but suspended under President George W. Bush.

According to a recent Federal Times report, the pilots have been mostly a bust so far.

Many of the bargaining pilots were incomplete by the deadline, or managers failed to collect hard data showing the bargaining style’s benefits to the government. OPM will recommend the administration continue the testing for two more years in its May report to Obama, Federal Times said.

By Amanda Palleschi

April 26, 2012