B-129031, SEPTEMBER 13, 1956, 36 COMP. GEN. 209

B-129031, SEPTEMBER 13, 1956, 36 COMP. GEN. 209

RETIRED EMPLOYEES REEMPLOYED - LUMP-SUM LEAVE PAYMENTS - ANNUITY DEDUCTION UNDER SECTION 13 (B) OF THE CIVIL SERVICE RETIREMENT ACT AMENDMENTS OF 1956, THE LUMP-SUM LEAVE PAYMENT DUE ON THE FINAL SEPARATION OF A FEDERAL EMPLOYEE WHO IS IMMEDIATELY REEMPLOYED AFTER MANDATORY RETIREMENT FOR AGE UNDER THE ACT DOES NOT HAVE TO BE REDUCED BY THE AMOUNT OF THE RETIREMENT ANNUITY.

TO V. DIPPER, INTERNAL REVENUE SERVICE, SEPTEMBER 13, 1956:

YOUR LETTER OF AUGUST 16, 1956, REQUESTS OUR DECISION IN THE CASE OF MR. ERNEST A. ROUNDTREE, AN EMPLOYEE IN GRADE GS-14, WHO IS TO BE RETIRED FOR AGE OCTOBER 31, 1956, AND WHO WISHES TO KNOW AT WHAT RATE HIS LUMP-SUM LEAVE PAYMENT WOULD BE COMPUTED SHOULD HE ACCEPT REEMPLOYMENT THE NEXT DAY AT THE SAME SALARY REDUCED BY HIS RETIREMENT ANNUITY.

AS INDICATED IN YOUR LETTER, ORDINARILY A CERTIFYING OFFICER MUST HAVE A VOUCHER BEFORE HIM FOR CERTIFICATION TO ENTITLE HIM TO A DECISION. HOWEVER, SINCE THE MANDATORY RETIREMENT OF THE EMPLOYEE CONCERNED WILL TAKE PLACE IN THE NEAR FUTURE, THIS OFFICE WILL UNDERTAKE TO ADVISE YOU IN THIS INSTANCE.

IN 28 COMP. GEN. 294, WE HELD THAT UNDER THE PROVISIONS OF THE LUMP SUM LEAVE ACT OF DECEMBER 21, 1944, 58 STAT. 845, 5 U.S.C. 61 (B), AND THE CIVIL SERVICE RETIREMENT ACT, THE LUMP-SUM LEAVE PAYMENT TO A REEMPLOYED ANNUITANT AT THE TIME OF FINAL SEPARATION WAS REQUIRED TO BE COMPUTED AT THE SALARY OF THE GRADE IN WHICH REEMPLOYED REDUCED BY THE AMOUNT OF THE ANNUITY ALLOCABLE TO THE PERIOD OF THE LEAVE PAYMENT. ALSO SEE 33 COMP. GEN. 591, REFERRED TO BY YOU. HOWEVER, SECTION 13 (B) OF THE CIVIL SERVICE RETIREMENT ACT OF JULY 31, 1956, 70 STAT. 757, 5 U.S.C. 2263, PROVIDES:

(B) IF AN ANNUITANT UNDER THIS ACT (OTHER THAN (1) A DISABILITY ANNUITANT WHOSE ANNUITY IS TERMINATED BY REASON OF HIS RECOVERY OR RESTORATION OF EARNING CAPACITY, (2) AN ANNUITANT WHOSE ANNUITY WAS BASED UPON AN INVOLUNTARY SEPARATION FROM THE SERVICE, EXCLUDING A SEPARATION UNDER THE AUTOMATIC SEPARATION PROVISIONS OF THIS ACT, OR (3) A MEMBER RETIRED UNDER THIS ACT) HEREAFTER BECOMES EMPLOYED, OR ON THE DATE OF ENACTMENT OF THE CIVIL SERVICE RETIREMENT ACT AMENDMENTS OF 1956 IS SERVING, IN AN APPOINTIVE OR ELECTIVE POSITION, HIS SERVICE ON AND AFTER THE DATE HE WAS OR IS SO EMPLOYED SHALL BE COVERED BY THIS ACT. NO DEDUCTIONS FOR THE FUND SHALL BE WITHHELD FROM HIS SALARY, BUT THERE SHALL BE DEDUCTED FROM HIS SALARY, EXCEPT FOR LUMP SUM LEAVE PAYMENT PURPOSES UNDER THE ACT OF DECEMBER 21, 1944, A SUM EQUAL TO THE ANNUITY ALLOCABLE TO THE PERIOD OF ACTUAL EMPLOYMENT AND THIS PROVISION CONCERNING THE LUMP-SUM LEAVE PAYMENTS SHALL ALSO BE EFFECTIVE IN THE CASE OF EACH RETIRED EMPLOYEE SEPARATED FROM REEMPLOYMENT AFTER DECEMBER 15, 1953, AND BEFORE THE EFFECTIVE DATE OF THE CIVIL SERVICE RETIREMENT ACT AMENDMENTS OF 1956 * * *. ( ITALICS SUPPLIED.)

ON PAGE 33, HOUSE OF REPRESENTATIVE CONFERENCE REPORT NO. 2935, 84TH CONGRESS, EXPLAINING THE BENEFITS OF THE ACT IT IS STATED THAT " ANY LUMP- SUM LEAVE CREDIT WILL NOT BE REDUCED BY REASON OF ANNUITY PAID TO HIM DURING REEMPLOYMENT.'

ACCORDINGLY, LUMP-SUM LEAVE PAYMENTS PAID TO AN EMPLOYEE RETIRED UNDER THE ACT OF JULY 31, 1956, AND SUBSEQUENTLY REEMPLOYED, WILL BE COMPUTED AT THE CLASSIFICATION RATE FOR THE POSITION HELD BY HIM WITHOUT REDUCTION OF THE AMOUNT OF HIS RETIREMENT ANNUITY.