[Request for Decision Concerning Severance Pay Entitlement of Army Employees]

A decision was requested concerning the entitlement to severance pay of two Army employees who were twice separated from their positions and later reinstated. In the first instance, they were erroneously separated from their permanent full-time positions due to a reduction-in-force and were retroactively reinstated with backpay in intermittent positions, without a break in service, by the Merit Systems Protection Board. Subsequently, they were separated from the intermittent positions due to another reduction-in-force. GAO found that the Army properly deducted their severance pay amounts from their backpay awards. Retroactive restoration of the employees to duty as intermittent employees terminated their right to severance pay in connection with the original separations. In addition, they were not entitled to severance pay as a result of subsequent involuntary separation from their intermittent positions. The claimants also objected to the fact that Federal income tax was withheld in one lump sum from their backpay award and that the Army deducted contributions under the Federal Insurance Contributions Act (FICA) from the amounts that had originally been paid as severance pay. GAO stated that it does not have jurisdiction regarding withholding taxes and that the FICA withholding appeared proper since they were reemployed in intermittent positions.