About the Merit Systems Protection Board

Federal Severance Pay

Severance pay can be a valuable benefit for many federal employees who are forced to leave their government jobs, but severance pay is not required for all federal employees. Therefore, if you have lost your job with the federal government, or if you are in danger of losing you job, you should understand whether or not you are eligible for severance pay and what you should do if you are denied the severance pay to which you are legally entitled.

Eligibility for Federal Severance Pay

In order to be eligible for severance pay, a federal employee must:

Be a Qualified Appointment. “Qualified appointment” is a complicated term that may require the expertise of a federal government employment lawyer. Generally, the term refers to career appointments in the competitive or excepted service. Therefore, it does not apply to political appointments who serve terms certain or those who serve at the will of the President;

Have Completed at Least 12 Months of Continuous Service. This requirement is fulfilled as long as the employee was employed for one continuous year in a civilian position with the federal government. The employee may hold more than civilian position during the 12 month period as long as the employment is continuous. Any break in employment of more than 3 calendar days breaks the continuity of employment. In some cases, non qualifying employment may count toward the 12 month continuous service requirement but the position from which the employee was terminated must still be a qualifying appointment; and

Be Removed Involuntarily and Not for Reasons of Poor Job Performance.

Additionally, a federal employee must not:

Deny another reasonable an offer of employment to another federal government position;

Be Eligible for an Immediate Annuity from the Government; or

Receive Injury Compensation From the Government.

Calculation of Severance Pay

Severance pay is calculated as a basic payment that is adjusted for age. Generally, employees are entitled to a weekly amount of pay that is based on the average of their last year of federal employment. Former federal employees are entitled to one week of pay for every year worked, up to 10 years and 2 weeks of pay for every year worked beyond 10 years. For partial years worked, an employee may earn 25% of the basic payment for each quarter year worked.

The severance pay calculation is adjusted for workers over 40. The employee may earn an additional 2.5% for each quarter year period (3 month period) over the age of 40 that the employee is at the time of the termination.

An employee may not collect more than 52 weeks of severance pay during a lifetime and other limitations on the collection of severance pay may apply.

Appealing Federal Severance Pay Decisions

If you believe that your rights to severance pay have been violated then you should seek the assistance of an employment lawyer who has experience bringing appeals before the Merit Systems Protection Board (MSPB). The MSPB may be able to hear your appeal and protect your rights to this important and valuable employee benefit, if you qualify.