A Bill Could Let Feds Save for Retirement Longer, and More

Legislation making its way through Congress would allow federal employees to save for retirement longer through the government’s 401(k)-style retirement savings program.

The Securing a Strong Retirement Act (H.R. 2954), introduced by Rep. Richard Neal, D-Mass., more commonly known as the SECURE 2.0 Act, passed unanimously out of the House last month. The bill, which is now under consideration in the Senate, would, among other things, increase the age at which people, including federal employees participating in the Thrift Savings Plan, must begin taking required minimum distributions from the current 72 years old to 75.

That change would be phased in over time: the age at which required minimum distributions kick in would be 73 beginning in 2023, 74 in 2030, and 75 beginning in 2033.

Additionally, a provision would require all catch-up contributions for 401(k)-style plans, including the Thrift Savings Plan, to be Roth, rather than standard pre-tax contributions. And it increases the annual limit for catch-up contributions to $10,000 when a TSP participant is between 62 and 64 years old.

At a meeting of the Federal Retirement Thrift Investment Board, which administers the TSP, last month, spokeswoman Kim Weaver said the agency has expressed concerns with lawmakers about a previous version of the bill that set implementation deadlines within weeks of its potential passage, but that staff is working with Congress to determine when those provisions should go into effect if signed into law.

Agencies Instructed to Improve Union Dues Collection

The Office of Personnel Management on Tuesday issued a series of memos aimed at advancing the Biden administration goals of making the federal government a “model employer” that embraces a collaborative relationship between management and labor, one of which could have a direct impact on federal employees’ paychecks.

One of the memos instructs agencies to process requests to start or end the automatic collection of union dues from federal employees’ paychecks “as quickly and accurately as possible,” as well as make it easier for employees to find the forms related to union dues collection.

In the memo, OPM Director Kiran Ahuja reminded agencies that failure to “expeditiously” process a payroll deduction request related to union dues is grounds for the union to file an unfair labor practice complaint with the Federal Labor Relations Authority, and could result in the agency paying the union to the tune of the amount that it effectively prevented the employee from contributing.

These rules also apply regardless of whether the bargaining unit has a union contract in place with the agency yet.

“[Federal labor law] requires the agency to honor the employee’s request for dues withholding whether or not there is a collective bargaining agreement in place between the agency and the union representing the employee," OPM wrote. “If an agency has a reasonable disagreement with the union over whether an employee should be included in the bargaining unit, this may be resolved in ‘unit clarification’ proceedings before the FLRA. Unit clarification decisions typically do not provide for the retroactive withholding or payment of union dues.”