5 U.S.C. § 8412a — Phased retirement

(a) For this section: (1) “Composite retirement annuity” is the annuity calculated when a phased retiree reaches full retirement status. (2) “Full retirement status” means the phased retiree has stopped working and, after applying, is entitled to that annuity. (3) “Phased employment” is less-than-full-time work by a phased retiree. (4) “Phased retiree” is a retirement-eligible employee^* who elects under (b) and has not entered full retirement. (5) “Phased retirement annuity” is the annuity paid before full retirement. (6) “Phased retirement percentage” is the percentage that, added to the working percentage, equals 100 percent. (7) “Phased retirement period” runs from entitlement to the phased annuity until death or separation from phased employment. (8) “Phased retirement status” means simultaneous phased employment and eligibility for the phased annuity. (9) “Retirement-eligible employee” means someone who would qualify under section 8412(a) or (b) if separated, but not someone who would qualify under section 8412(d) or (e), and not an employee described in section 8425 after required separation. (10) “Working percentage” is hours scheduled per pay period in phased work divided by full-time hours in a comparable position.

(b)(1) With agency-head agreement and under Director^* regulations, a retirement-eligible employee full-time for at least the preceding 3 years may elect phased retirement. (2)(A) The starting working percentage is 50 percent. (B) Regulations may set another percentage from 20 through 80 percent. (C) It cannot change during the phased period. (D) At least 20 percent of hours must be mentoring, unless regulations make an exception. The mentoring rule does not apply to Postal Service^* phased retirees, but may apply to Postal Regulatory Commission retirees. (3) The person may hold only one position and may transfer within or between agencies only without changing the percentage. (4) Only one election is allowed in a lifetime. (5) The person cannot also elect under section 8420a.

(c)(1) The phased annuity equals the section 8415 annuity that would have been payable if the person had separated and retired under section 8412(a) or (b) on entering phased status, multiplied by the phased-retirement percentage. (2) It is paid in addition to phased-job basic pay^*. (3) It is adjusted under section 8462. (4) It is not reduced for, based on, or subject to a court^* order requiring a survivor^* annuity, but is subject to other legal-process orders on the same basis as other annuities. (5) Required deposits or actuarial reductions for military or certain civilian service must be made or elected by entry into phased status, not full retirement. If the phased retiree dies in service without doing so, a survivor has the same deposit right the employee would have had without phased retirement. (6) The annuity begins when phased employment begins. (7) Unused sick leave is not used in calculating it.

(d) Basic pay up to the position’s full-time rate counts as basic pay under sections 8422 and 8423. (e) Under Director procedures, a phased retiree may elect full retirement at any time and then receives a composite annuity. (f)(1) Unless this subsection provides otherwise, that single annuity equals the phased annuity at full retirement, including section 8462 adjustments, plus the product of (i) the section 8412 annuity that would have been payable at full retirement without phased retirement, using full-time pay for the occupied position and before survivor adjustment, and (ii) the working percentage. (2) The Director then applies survivor-annuity reductions. (3) It is adjusted under section 8462, except section 8462(c)(1) does not apply. (4) Sick leave at full retirement is adjusted by dividing its hours by the working percentage.

(g)(1) With agency-head agreement and under Director procedures, the retiree may end phased status and return full time. (2) The phased annuity ends on that return. (3) Later rights are governed by the law at the later separation, and the phased period is treated as part-time work at the elected schedule. (h) For subchapter IV, death is treated as death in service; the period is treated as part-time work except for section 8442(b)(1)(A)(i); and for that clause the person is treated as receiving the full-time rate. (i) The work is not part-time career employment under section 3401(2). (j) No annuity supplement under section 8421. (k) For subchapter III, the person is treated as an employee. (l) Retirement for section 8445(d) occurs upon full retirement. (m) The person cannot apply under subchapter V. (n) Section 8468 does not apply. (o) For chapter 87, the person is treated as receiving full-time basic pay.