Senate approves retirement error correction bill

The Senate last week approved a bill that would help thousands of federal employees who were placed in the wrong retirement system by their agencies.

The Federal Erroneous Retirement Coverage Corrections Act (S. 1232) would give affected employees the choice of moving into the retirement plan they should have been in or staying in the plan their agencies mistakenly placed them in.

S. 1232 is similar to a bill, H.R. 416, passed by the House in March. Differences between the two bills focus primarily on the formulas they set for determining how the retirement corrections would be paid for. The Senate version also contains provisions addressing tax liability not included in the House version.

Ned Lynch, senior research director at the House Government Reform Civil Service Subcommittee, said staffers from the House and Senate will meet to work out differences in the two bills, but added that it's unlikely the differences will be resolved before Congress adjourns for the year. Lawmakers are trying to finish their business by Veterans Day. Affected employees, many of whom have been seeking a remedy to their retirement debacle for up to five years, will probably have to wait at least until next year for a fix.

The retirement snafu arose in the mid-1980s, during the transition from the old Civil Service Retirement System (CSRS) to the Federal Employees Retirement System (FERS). Confused agencies placed some employees in CSRS when they should have been in FERS and some in FERS when they should have been in CSRS. Up to 18,000 federal workers may have been affected.