FERS Disability Retirement law Archives

June 1, 2020November 3, 2021

The Covid-19 Nexus in a Federal Employee Disability Retirement Claim

Covid-19 and Federal Disability Retirement

This is a strange world we live in. The Covid-19 Pandemic has impacted all sectors of the economy, devastated large segments of our society, ravaged the older generation and effectively shut down social interaction. Federal employees and U.S. Postal workers may appear to be relatively unscathed because they remain employed, salaried and productive — much of it through teleworking arrangements. Certain jobs, of course, cannot be accommodated through teleworking. Thus, Air Traffic Controllers, Special Agents, TSA workers, Criminal Investigators, Correctional Officers, CBP Officers and a multitude of other positions do not easily lend to teleworking, and even those who have the limited capability of working from home must still come into the office to pick up mail, obtain files and otherwise interact and interface with other essential elements of the position. Whether by actual consequences of the Corona Virus, or the potential thereof, Federal Disability Retirement must be an option open to Federal and Postal employees.

The laws governing Federal Disability Retirement are simple enough: A medical condition suffered while being a Federal or Postal employee, which results in a Federal or Postal Worker being prevented from performing one or more of the essential elements of one’s position. In the well-known case of Bruner v. Office of Personnel Management, 996 F.2d 290, 293 (Fed. Cir. 1993), the U.S. Court of Appeals there clearly stated the applicable standard for disability retirement determinations, stating therein that one of the criteria was the demonstration of a “deficiency in service with respect to performance, conduct or attendance, or in the absence of any actual service deficiency, a showing that the medical condition is incompatible with either useful service or retention in the position.” How will the potentiality of Covid-19’s after-effects — of attacking those who are vulnerable because of underlying medical conditions — impact a Federal Disability Retirement application? For, it is one thing to assert that a specific medical condition prevents a Federal or Postal employee from performing an essential element of one’s job; it is quite another thing to argue that, because of an underlying medical condition, a person cannot return to one’s position because, to do so will unreasonably endanger a person by being exposed to a deadly virus that has already proven to ravage and take advantage of pre-existing medical conditions. Of course, if a vaccine were to be produced, such issues may become a moot point. Until then, however, the issue of Covid-19 and its impact upon a Federal Disability Retirement application remains fluid, at best.

Bracey v. Office of Personnel Management, 236 F.3d 1356, 1358 (Fed. Cir. 2001), of course, is another oft-cited case which clearly delineates the eligibility criteria for Federal Disability Retirement. There, the Federal Circuit Court delineated and outlined the applicable provisions governing disability retirement, stating that “the pertinent OPM regulation elaborates on the statutory definition by providing that an employee is eligible for disability retirement only if (1) the disabling medical condition is expected to continue for at least one year; (2) the condition results in a deficiency in performance, conduct, or attendance, or is incompatible with useful and efficient service or retention in the employee’s position; and (3) the agency is unable to accommodate the disabling condition in the employee’s position or in an existing vacant position.” This 3-pronged clarification of the criteria for Federal Disability Retirement can be used in evaluating a case involving a Federal or Postal employee who suffers from underlying medical conditions which may potentially pose an unreasonable risk if exposed to the Covid-19 virus. Take statutory criteria No. 1 — where the disabling medical condition “is expected to continue for at least one year”; are we referring to the underlying medical conditions in isolation from the potential impact of being exposed to Covid-19? If so, unless the underlying medical conditions themselves prevent the Federal or Postal employee from performing his or her job functions, then it is unlikely that a Federal or Postal employee will become eligible for Federal Disability Retirement benefits in connection with the Corona Virus issue. However, if a treating medical doctor places unequivocal restrictions upon a person’s ability to go to work because of the potentially deadly impact that exposure to the Corona Virus would have upon that person’s health, would that be enough to qualify for Federal Disability Retirement benefits? Especially, if no vaccine or reasonable treatment regimens have been discovered? This is an open question that may have to be “explored” with test cases which will surely come about in the very near future.

With respect to criteria 2 & 3 of the Bracey decision, the same arguments would apply, of course. Non-attendance and deficient performance because of a medical restriction imposed by a treating doctor upon a Federal or Postal employee with a compromised immune system, underlying medical conditions such as diabetes or preexisting respiratory illnesses, etc., will no doubt be a basis for filing a Federal or Postal Disability Retirement application. Similarly, no Federal Agency or Postal facility will be able to guarantee that an “accommodation” can be provided where exposure to the Corona Virus will be prevented; for, in many instances, such exposure would essentially be a death sentence. “Incompatibility” is the “4th” standard in a Federal Disability Retirement application, when a Federal or Postal employee lacks any deficiencies in performance, conduct or attendance, but where a person’s medical conditions are no longer consistent with continuation in a Federal or Postal position.

Additionally, the question for the future will be — to what extent can a Federal Agency “accommodate “the potency and potentiality of a deadly disease? And, on the flip-side, what is a “reasonable” level of risk that a Federal or Postal employee who has an underlying medical condition must face before the law concludes that you are eligible for OPM Disability Retirement benefits? These are, ultimately medical questions insofar as one’s treating doctor will have to weigh the severity and extent of a person’s underlying medical condition, and balance such medical facts as against the risk of exposure to the Covid-19 virus and the potential resulting consequences. As more and more information is gathered by the Centers for Disease Control and Prevention and the rest of the medical community, some of these questions surrounding Federal Disability Retirement, accommodation needs and inherent risks in performing one’s Federal job or Postal craft will become clarified. Ultimately, however, when preparing a Federal Disability Retirement application under FERS which involves a Covid-19 issue — whether of its potential danger because of an underlying medical condition or its direct impact because it involves a Federal or Postal employee who has already contracted and suffered from its toll — a proper nexus must be established that connects all of the “dots” between the medical conditions involved, the essential elements of one’s Federal or Postal position, and the ability and capacity of a Federal Agency or Postal facility to properly “accommodate” a person’s medical conditions.

The Covid-19 Virus is, as many have characterized it, invisible, deadly, and still mysterious. What impact it has upon Federal employees and Postal workers who suffer from co-morbidities which, in and of themselves may not qualify for Federal Disability Retirement benefits; the extent of the potential for serious medical consequences if one contracts the Corona Virus; and the type of reasonable accommodations which must be offered by a Federal Agency or the Postal Service — these are still open-ended questions to be answered, perhaps by rulings in cases at the U.S. Merit Systems Protection Board. In the end, Federal employees should not have to face a choice between one’s job and the potentiality of exposure to the Covid-19; but in preparing an effective Federal Disability Retirement application involving the Corona Virus and its potential impact, a proper nexus will have to be established to show that an incompatibility exists between one’s Federal or Postal job and the medical risks involved.

About the Author

Robert R. McGill is an expert advisor for Federal Disability Retirement claims, a highly specialized legal practice which he, as a Federal employee attorney, dedicates 100% of his time helping Federal and Postal workers secure their disability retirement benefits under both FERS and CSRS. For more information about his legal services, publications and forum, please visit his Federal Disability Retirement blog.

This article was originally published in the HG.org directory (5/14/20)

February 10, 2020December 24, 2022

Federal Disability Lawyer Fees

Should you worry about how much it will cost you to hire a Federal Disability Lawyer?

It is a genuine worry. There are plenty of lawyers on the Internet who say that they “guarantee” — with a “money-back” promise — a successful outcome. But what good is it to give you back your money if your application is denied at the first hint of trouble, and how much work and effort do you think such a law firm will put into your case? At first sight, a “money-back” guarantee may seem like an attractive proposition. You’ll get your money back if a Federal Disability Lawyer can’t deliver. The problem is: How much “delivery” will there be to begin with? And what good is the money returned if you have not secured your Federal Disability Retirement benefits — and more importantly, if you didn’t even put enough effort into a case to give it a fighting chance?

By the time you come to a point where filing for Federal disability retirement benefits becomes a reality, you have already invested both time and money into a career whose goal was to create a “nest egg” for retirement purposes. You may have already invested 10, 20 or even 30 years in a Federal career, and you are about to lose everything because of an injury or a medical condition. Taken in that context, “How much” you will be paying to your attorney shouldn’t be your primary concern. The attorney you hire might promise you your money back — but what good is that if you haven’t taken your “best shot” at securing your future? In filing for Federal Disability Retirement benefits, you are given only one opportunity to save your 10-30 years of hard work before it is thrown out the window. Who you hire as your Federal Disability Lawyer; how much he is willing to fight on your behalf; what effort will be expended on your behalf; whether he is accessible to you throughout the process — these and many more considerations should be part of the “investment” into your own future. On the other hand, your “Federal Disability Lawyer” who gives you that “money-back guarantee” might realize that your case is too hard to fight for, that it was not “easy money” and he/she might therefore decide to quit on you. Yes, it can happen. It has happened to others.

Meanwhile, your Agency or the Postal Service might have already let you go because you filed for Federal Disability Retirement. The potential disaster is that you were “medically separated” but you didn’t qualify for Federal Disability Retirement benefits. Yes, it can happen. It has happened to others.

When you are struggling to survive after spending a 10-30 year career with the Federal Government, your legal fees are still an important consideration — but even this financial consideration should really be comparatively unimportant when considering the bridges you might be burning behind you. Don’t be fooled by the “100% Money Back Promise‎”.

Be smart. Hire the best Federal Disability Lawyer you can find. Do your homework: Ask former Federal employees who have already successfully filed for Federal Disability Retirement benefits (nothing can beat a personal recommendation); consult with an honest union steward; and research for the best attorney in the field. Read real reviews (a tip: if an attorney can write his/her own review on his website or even in Google reviews, that might not be a good basis upon which to make a decision); go instead to reputable lawyer directories, public forums, or even the BBB after finding potential Federal Disability Lawyers.

In the end, saving a few hundred of dollars might cost you the rest of your life savings. Be smart. Medical conditions can become a disaster in the life of the Federal or Postal employee. Don’t let a medical disaster become a legal disaster.

Yes, it can happen. It has happened to others.

AllLawyers.org

July 23, 2019December 29, 2021

FERS Disability Retirement: First and Foremost, a Medical Matter

A linear thought process requires priority and sequence, importance and significance, placement both in mind, culture and character. A circular thought process allows for the equality and recognition that the totality of the universe is important to the chain of events, time, history, culture, people, and God. Wars, famine, destruction and loss of faith can be avoided when one sees Man within the framework of circularity. Linear thought has an end; circular thought only begins.

From Zen: The Master and the Pupil

In all phases of life, one must always determine that which precedes another in matters of priority, importance and significance. In philosophy, and specifically Aristotelian Metaphysics, “form” (the “whatness” of a thing) enjoys priority to “matter” (the material which makes up a thing), so in all aspects of life one must always be aware of that which is important, that which is secondary, and so on.

In preparing to file for Federal Disability Retirement benefits under FERS, the “priority” of concerns must always be to attend to the medical condition, the injury, the illness, etc. Thus, the paradigm of what happens in “real life” is often as follows: A Federal or Postal worker who has worked in the Federal sector for many, many years, begins to develop a medical condition, and in the first year of the medical condition, has to use up much of the accrued sick leave, and maybe even all of the accrued annual leave, and perhaps even some LWOP.

For the fortunate Federal or Postal employee, two elements may coalesce and the outcome would be a positive one: the medical condition is “cured” or otherwise becomes stable; the Federal Agency or the Postal Service has supported the employee, and the aberration of exhausting all of the sick leave, annual leave, and going on LWOP was a mere blip on the Federal or Postal employee’s record, and life and career advance uninterrupted.

But the identical hypothetical, in real life, can take on a very different course of events. The medical condition progressively deteriorates the health of the individual; the medical condition becomes “chronic”; sick leave is exhausted faster than it is accrued; the work which the Federal or Postal worker leaves undone because of the lengthy absences is not left as a residue of mere whispers in the hallways of the Federal building; rather, they become a malignancy which expands into open hostility by the Agency.

At some point in the “process” of a deteriorating medical condition, the question is asked: Is it time to file for FERS Disability Retirement benefits? At what point does this question arise? If it is asked too soon, there is the appearance that one is merely trying to “game the system”. If it is asked too late, there is the untenable circumstance that the Federal or Postal employee has done everything to destroy the life and career that one has worked so hard to preserve — exhausting all savings; imprinting the blemish upon one’s reputation of being a conscientious worker; being placed on a Performance Improvement Plan (commonly referred to by its acronym, a “PIP”); straining the carefully fostered relationships developed over many years within the Agency by having others “carry the workload”, etc.

It is often the gray line — the boundary between suffering from a medical condition and attempting to take care of the medical condition; and the recognition that one must survive — financially, emotionally, for the present and the future; and the tension which builds between the two. There is rarely a “right” time to ask about Federal Disability Retirement benefits. At some point, it becomes a natural question. If the Federal Agency “suggests” such a course, it is probably at a later stage than was necessary; if the doctor suggests it, it is at least a time of serious consideration. If the Federal or Postal employee is contemplating it, then certain considerations should always come to the forefront.

When the time comes in the life of a Federal or Postal employee to contemplate filing for FERS Disability Retirement benefits, the conceptual distinction must be made between “having a medical condition” and “proving that a medical condition prevents one from performing one or more of the essential elements of one’s job.” There is thus the “medical aspect” of the life of a Federal or Postal employee, and the “Disability Retirement applicant aspect”. While the two should never directly conflict, the existence of the former does not necessarily guarantee the success of the latter.

This is where priority, importance, and significance come into play.

Priority: One’s health and well-being; taking care to obtain the necessary medical treatment to regain one’s health — these should be the priority in one’s life.

Importance: While one’s health concerns have a priority; this does not mean that collateral needs are unimportant. Importance is not defined by priority in sequence. Rather, there can be multiple issues of relatively equal importance, and the focus upon one does not diminish the importance of another. In a Federal Disability Retirement application, it is critical to begin laying the groundwork in obtaining the necessary medical evidence in order to prove one’s eligibility for Federal Disability Retirement benefits under FERS.

Significance: Keeping in mind that the priority of concern is health and well-being; that importance of other considerations does not detract from the priority of that singular focus upon one’s health; and further, that there are significant evidentiary issues which must be confronted in preparing a Federal Disability Retirement application.

How does all of this translate into the practical sphere, for a Federal or Postal worker, in preparing to file for FERS Disability Retirement benefits? Take, for instance, the issue of medical treatment, and how such medical treatment will impact one’s eligibility in filing for Federal Disability Retirement benefits. If surgery for a medical condition is an option, must one undergo such surgical intervention? How about physical therapy? Medication regimens?

Such questions obviously contain all three of the elements previously discussed — priority (which modality of treatment and to what extent), importance (whether certain medical treatments will be helpful, and what impact will refusal have upon a Federal Disability Retirement application), and significance (can refusal to engage certain modalities of treatment regimens prevent one from being eligible for Federal Disability Retirement benefits) — all coalesce and intersect.

Where does singular focus upon medical treatment end, and considerations of Federal Disability Retirement begin? This is probably a rhetorically irrelevant question, because treatment for one’s medical condition should never “end”, but at some point, there is an intersection between the medical condition, and steps to be taken to document one’s medical condition for purposes of filing Federal Disability Retirement benefits.

When the two issues coalesce, certain legal principles need to be kept in mind. For instance, one should note that an applicant for disability retirement benefits must establish the extent to which her disability can or cannot be “controlled”. Shanoff v. Office of Personnel Management, 103 M.S.P.R. 549 (2006). Furthermore, the Board has repeatedly held that the voluntary refusal to accept facially reasonable treatment, standing alone, will bar entitlement to Federal or Postal Disability Retirement benefits.

The obvious question here, of course, is what is “facially reasonable treatment”? When an employee is unable to render useful and efficient service because the Federal or Postal employee fails or refuses to follow or to accept normal treatment, then it will be found that the disability flows, not from the disease or injury itself, but from one’s voluntary failure or refusal to take the available corrective or ameliorative action. Again, Shanoff, 103 M.S.P.R. 549, (citing Baker v. Office of Personnel Management, 782 F.2d 993, 994 (Fed. Cir. 1986)).

As the 20th Century Philosopher Ludwig Wittgenstein once noted, the mere fact that one may not be able to observe the clear demarcation between light and darkness, does not mean that either don’t exist. Similarly, while the Merit Systems Protection Board may not always explicitly define, for each and every case, what kinds of medical treatments “must” be followed, doesn’t mean that there aren’t certain guidelines to follow. For instance, in Diener v. Office of Personnel Management, 7 M.S.P.R. 551, 555 (1981), the Board found that an estimated probability of success of future surgery is speculative, just as a prediction as to the worsening of a condition may be, and will not necessarily provide a basis for denial of a disability annuity.

On the other hand, it has been found that where an appellant has failed to accept facially reasonable treatment because she did not follow her physician’s recommendations to undergo psychological therapy or to take prescribed anti-depressants, such refusal would be a basis for a Federal Disability Retirement application denial.

Thus, the “spectrum” of what is facially reasonable treatment can be fairly discerned. On the one extreme of the spectrum, is the option of undergoing invasive surgery. On the other end of the spectrum, is the mandate of following a doctor’s medication regimen. Everything else falls in between the two extremes.

Throughout, it is always essential to recognize that obtaining the proper medical treatment has the primacy of priority; that at some point in treating one’s medical condition, a Federal or Postal employee may begin to consider whether to file for FERS Disability Retirement benefits, and the importance of obtaining the proper documentation must be addressed; and finally, the significance of evidentiary issues in preparing a Federal Disability Retirement application must be recognized. Thus, medical treatment is the priority; obtaining the proper medical documentation is of importance; and consideration of evidentiary issues is of significance. Identifying and recognizing the conceptual distinction between the three will hopefully be helpful for all Federal and Postal employees who are considering filing for Federal Disability Retirement benefits.

Sincerely,

Robert R. McGill, Esquire
FERS Disability Retirement Attorney

About the Author

Robert R. McGill is an attorney who specializes in Federal Disability Retirement, a practice area he dedicates 100% of his time helping Federal and Postal workers secure their disability retirement benefits under both FERS and CSRS. For more information about his legal services, publications and forum, please visit his Federal Disability Retirement website.

March 5, 2019August 19, 2022

Some Thoughts on Social Security and FERS Disability Retirement

Do I have to file for Social Security Disability Income (SSDI)?

Filing for Social Security Disability benefits is “required” when filing for Federal Disability Retirement benefits under FERS. This additional step, however, has always been somewhat confusing and problematic. Why does the Federal or Postal employee who is filing for Federal Disability Retirement benefits have to file for SSDI, anyway? What are the consequences of being denied (which most Federal and Postal employees are, anyway)? What happens if the Federal or Postal employee who is filing for FERS Disability Retirement benefits becomes approved for SSDI?

The process of filing a Federal Disability Retirement application is fraught with major obstacles, confusing administrative procedures and complex, almost unintelligible roadblocks – not least of which is the requirement to file for Social Security Disability benefits with the U.S. Social Security Administration. Most Federal Agency Human Resource Offices will tell you that you “must” file for Social Security benefits before applying for FERS Disability Retirement benefits, as if such a step is a prerequisite for even a preliminary consideration of a Federal Disability Retirement application. Indeed, most Federal Agency H.R. Offices, and even the U.S.P.S. Shared Services Office in Greensboro, North Carolina, will not process a Federal Disability Retirement application unless there is some evidence that an SSDI application has been filed. Is this truly what the law requires? And, more importantly, how far does one have to go in meeting the requirement – merely a cursory effort to satisfy the formality, or must one wait until all appeals are exhausted (which, for SSDI procedures, could potentially take years, by which time the 1-year statute of limitations to file for Federal Disability Retirement benefits may have lapsed)?

FERS Disability Retirement and SSDI Offset

The plain fact is that the U.S. Office of Personnel Management doesn’t care a twit about Social Security Disability Insurance – unless it is approved, and that, only if the FERS Disability Retirement application is also approved. For, if both are approved (FERS Disability Retirement & SSDI benefits), then the law requires an offset between the two – 100% offset in the first year of concurrent payments (where the FERS annuitant would receive 60% of the average of one’s highest 3 consecutive years of service), then a 60% offset during the subsequent concurrent years of payments (where the FERS annuity is paid at 40%). It is the offset itself which OPM is concerned about, and since Social Security payments are primary (meaning that the SSDI payments are paid in full) while the FERS Disability Annuity is “secondary” (where the offset occurs by reducing the amount of the FERS Disability Annuity by the percentage of legally-mandated offset required), OPM is concerned that an approval of SSDI benefits will therefore impact the amount of annuity payments calculated by OPM’s disability retirement payments.

How does the interactive process work – between filing for a FERS Disability Retirement and Social Security Disability Insurance? Here is an example:

A Federal or Postal worker starts to prepare filing for a Federal Disability Retirement application, and begins completing the SF 3107 series of forms, as well as the SF 3112 series. As part of the process, he or she is told that one must apply for Social Security Disability Insurance, and attach proof of such filing along with the other Standard Forms for a Federal Disability Retirement application. He does so – files, knowing that it will be denied, especially since he is technically still “employed” by the Federal agency or the Postal Service. He asks himself, “Why do I need to file”? The reason: That is the law, and whether the law makes sense or not, it is a requirement. The FERS retirement paradigm has always been based upon a 3-pegged financial system: The Federal Retirement; Social Security; the TSP (Thrift Savings Plan). When one is accessed (the retirement itself), then the other component (Social Security) must also be applied for. Having filed, the requirement is satisfied. Questions: Do you need to do anything more? Can you just not put much effort into it? If the SSDI filing is denied, must you appeal it? The answers: No, yes and no. Postscript: Once you receive an approval for your Federal Disability Retirement application, will you have to file again when you are no longer employed? Not necessarily; however, if OPM asks you to re-file, then you should go ahead and file with the SSDI Office once again. What are some of the factors to consider as to how aggressively you may want to pursue Social Security Disability benefits when concurrently filing for Federal Disability Retirement benefits? Here are some factors to consider:

First, as stated earlier and reiterated again, understand that there is an offset between FERS Disability Retirement annuity and Social Security Disability Insurance benefits – a 100% offset in the first year of concurrent benefits with a FERS annuity at the 60% rate; then, a 60% offset during all subsequent years (until recalculation at age 62) while FERS benefits are paid at the 40% rate. Since Social Security is “primary”, the offsetting reduction is applied to as against the FERS Disability annuity. However, Social Security has a very low threshold of capacity to earn any income before you “lose” it (normally somewhere in the range of $1200 – $1300 per month), and so if the FERS Disability Annuitant plans on working at some private sector job making more than the threshold amount, it may not be worthwhile to even pursue Social Security Disability benefits aggressively. Contrast the low threshold under SSDI against the allowable amount for a FERS Disability Annuity: You are allowed to make up to 80% of what your former position currently pays.

An example of the FERS-SSDI offset calculation

Thus, by way of example: Hypothetical Annuitant A: A former Postal worker made $55,000.00 per year (and, for purposes of making this example simple, the same amount for the average of his highest-3 consecutive years of service.) Thus, in the first year, he receives $33,000 as his FERS annuity (60% of $55,000), and in the second year, $22,000 as his FERS annuity (40% of $55,000). Rounding off the numbers to simplify, let’s say that it comes to around $3,000 per month for the first year, then $2,000 per month for the subsequent years. The former Postal worker also gets SSDI approved, and the amount comes to $2,000 per month.

How does the offset work? Well, as SSDI is “primary”, the Postal worker would receive $2,000 from Social Security the first year, and $1,000 from his FERS annuity (as 100% of the SSDI payment is offset against the FERS payment), and in the second and subsequent years, he would receive $2,000 from Social Security and $800.00 from FERS (as 60% of the SSDI payment is offset against the FERS payment). If Annuitant A works at a private-sector job and makes $1,000 per month, all well and good – for, that amount would not exceed the threshold for either the FERS Disability Retirement annuity nor the SSDI allowable amount. If, however, he goes out and makes $2,000 per month, or some higher amount that violates the allowable threshold for Social Security, then he will lose the SSDI benefit, and any prior offset with FERS will be recalculated to allow for the full annuity.

Should I pursue Social Security disability benefits?

Thus, the factors that one should consider when pursuing Social Security Disability concurrent with a FERS Disability Retirement application, should take into account the following questions:

Will I be working at a private sector job, and if so, how soon after I begin receiving a FERS Disability Retirement annuity, and approximately how much will I expect to be making?
While the combination of FERS Disability Annuity and the SSDI payments will net me more, will it be worthwhile if I go out and get a job that exceeds the Social Security threshold of acceptable limits? For, as a practical matter, while the offset against a FERS annuity payment is supposed to be recalculated by OPM if the SSDI benefit is lost, the reality is that OPM is a large and rather unresponsive bureaucracy, so that getting the full benefit back will often take up a great amount of time – several months, at least.
Do I expect to work at a private sector job that will make pursuing SSDI impractical, and therefore should I put in the minimum effort necessary to simply comply with the requirement of filing for SSDI?

Be careful…

These are some considerations that should be thought through during the initial stage of the process. In theory, getting approved for SSDI and getting both the FERS annuity, as well as the SSDI benefit – even with the offset – would seem to be a “no brainer” given that the combination of both will almost always net you more money. However, a caveat on what has been occurring more and more is in place. The “Offset” between the FERS Federal Disability Retirement annuity and SSDI payments is supposed to happen automatically.

One would think that, in this computer-age of technological advancement, cross-checking based upon Social Security numbers and other identifying factors would be fairly commonplace and automatic. Think again.

Many hundreds, if not thousands, of Federal and Postal Federal Disability Retirement annuitants receive notification years later of an “overpayment” that must be repaid and reimbursed – amounting to, in some cases, in the hundreds of thousands of dollars. How and why does this occur? Quite simply, because the two agencies – OPM and the Social Security Administration – never communicated with each other, never cross-checked the payments, and most importantly, never offset the required amount. Thus, the Federal or Postal worker who was approved both for FERS Disability Retirement benefits, as well as SSDI, received two “full” checks, and continued to deposit both and spend both amounts.

Now, some would say: Well, yes, repaying the government is only fair – you should have known that the offset wasn’t happening, and you should have “set aside” the amount of the offset knowing that you would one day be “caught” accepting both. Without making a judgmental comment on such a perspective, the reality is that, whether the Federal or Postal dual-annuitant knew, didn’t know, didn’t think he or she would be “caught” or be forced to repay the amount of the overpayment, the simple fact of the matter is that overpayment based upon the incompetence of the Federal bureaucracy occurs all too often, and because the funds from a FERS Disability Retirement comes from the U.S. Government, when the oversight of overpayment is caught, the best you can do is to negotiate the most advantageous repayment plan possible.

Finally, a closing thought on the case of Stephenson v. OPM – a major case won by this author, argued before the U.S. Court of Appeals for the Federal Circuit, decided on January 18, 2013. In that case, OPM had steadfastly refused to restore the full amount of a FERS Disability Retirement annuity despite the loss of the offsetting SSDI benefits, arguing that there was a period where the annuitant remained “entitled” to SSDI benefits despite not actually receiving any money from the Social Security Administration. OPM refused to recalculate and restore the FERS Disability annuity amount and continued to offset a phantom payment merely because a person was still hypothetically “entitled” to the amount. That issue is now resolved because of the decision in Stephenson v. OPM, but a caveat concerning offsets is in order, here.

Theoretically and legally, one can get approved by SSDI, work, earn an amount that exceeds the SSDI threshold, then request that OPM restore the previously offset amount and recalculate so that the full FERS Disability annuity is received. However, as a practical matter, OPM is a large and cumbersome bureaucracy that takes forever to respond. Just keep that in mind. Thus, with any and all issues concerning SSDI, offsets and FERS Disability Retirement, keep the following close to heart: You may be “right”, but it may take a long, long time to recover – whether on the issue of restoration and recalculation of a lost benefit; whether it concerns overpayment; or any other issue concerning SSDI, FERS Disability Retirement annuity and the interacting, offsetting features between the two. Thus, as with everything else, plan accordingly.

Sincerely,

Robert R. McGill, Esquire
Federal Disability Attorney

About the Author

February 12, 2019June 8, 2022

FERS Disability Retirement Compared To OWCP

OWCP vs. FERS Disability Retirement

The Department of Labor administers Federal Worker’s Compensation Benefits through the Office of Workers’ Compensation Programs (OWCP). Such benefits are non-taxable, and are paid for temporary total disability, for injuries or medical conditions which result from, or are caused by, a workplace injury. There are many tangential factors which may be added to this basic definition, but for purposes of distinguishing OWCP from the Office of Personnel Management (OPM) Disability Retirement, this definition will suffice. Additionally, generally speaking, OWCP/Federal Worker’s Compensation is not a “retirement system.”

OPM Disability retirement, on the other hand, is a retirement system. As a result of a medical condition which impacts one’s ability to perform the essential elements of one’s job, a person is eligible to retire early, based upon a “medical disability.” A person on OPM Disability Retirement is separated from the Federal Agency, and he or she may “move on” in life, and perhaps start another career (with certain limitations as stated below).

When is it Time to File for FERS Disability Retirement?

An individual must file for Federal Employees Retirement System/Civil Service Retirement System (FERS/CSRS) disability retirement benefits with the Office of Personnel Management within one (1) year of being separated from Federal Service – otherwise, the right to be eligible for disability retirement benefits is lost. Do not confuse this with being placed on Leave Without Pay (LWOP), or being out on OWCP for being injured. The clock begins ticking when you are actually separated from service. Most people, however, should not wait until they are separated to file for disability retirement benefits, but rather, should file whenever it becomes apparent that he or she can no longer perform one or more of the essential elements of the job.

Taxable vs NonTaxable Benefits

OWCP benefits are non-taxable. OPM Disability Retirement benefits, on the other hand, are taxed. While receiving disability retirement benefits, a person may undertake a job search, accept another position, and earn up to 80% of what his or her former position currently pays. Individuals receiving OWCP temporary total disability may not work at another job – period. Here is a sample scenario using FERS Disability Retirement rules:

A worker’s average salary for 3 consecutive years totals $50,000. The individual goes out on disability retirement, and after the first year (in which he would receive 60%, or $30,000), he is eligible to receive an annual annuity of 40%, or $20,000. The worker then applies for and accepts a job in the private sector. The worker can accept a job that pays up to $40,000 per year (80% of the current salary), and still be eligible to receive the $20,000 per year disability annuity.

The 80% Rule Increases Over Time

The rule is “80% of what a person’s former job pays currently.” If 5 years from now, a person’s former position pays $60,000 per year instead of $50,000, then he can make up to $48,000 per year at the job, because 80% of $60,000 is $48,000.

Filing for Disability Retirement while on Workers’ Compensation

It is often not a bad idea for those who are receiving OWCP benefits to remain on OWCP for as long as they can stand it (i.e., the persistent harassment, the constant oversight by so-called “2nd opinion doctors”, etc.) — but to always have the FERS/CSRS disability retirement annuity approved as a back-up source of income. Individuals may file for disability retirement concurrently while on OWCP — but you simply cannot collect from both at the same time (See 5 C.F.R. Sec. 844.105, “Relationship to workers’ compensation. (a) Except as provided in paragraph (b) of this section, an individual who is eligible for both an annuity under part 842 or 844 of this chapter and compensation for injury or disability under subchapter I of chapter 81 of title 5, United States Code (other than a scheduled award under 5 U.S.C. 8107(c)), covering the same period of time must elect to receive either the annuity or compensation.”).

When OWCP terminates payments (and there is a very good chance that this will happen at some point in the near future), it is a wise option to have your disability retirement benefits approved, but held in an inactive status. Federal workers have every right to elect one benefit over the other. Indeed, if you wanted to, you are allowed to go back and forth between OWCP and FERS Disability Retirement.

As a secondary issue on this matter, a closer look at 5 U.S.C. Section 8106, paragraph (c) (2), (OWCP) on “partial disability” compared with the definition for disability retirement reveals: that “partially disabled employee who refuses or, neglects to work after suitable work is offered to, procured by, or secured for him, is not entitled to compensation.” This means that if OWCP secures a job for you as a retail store greeter for instance, and pays you the difference between your salary and what retail store pays — and you decide to say “no”, OWCP has every right to cut off your payments.

On the other hand, under the laws concerning FERS Disability Retirement, 5 C.F.R.Sec. 844.103 (a)(2) states that, in order to be eligible for disability retirement, the individual “must, while employed in a position subject to FERS, have become disabled because of a medical condition, resulting in a deficiency in performance, conduct, or attendance, or if there is no such deficiency, the disabling medical condition must be incompatible with either useful and efficient service or retention in the position.” The difference here is that, under OWCP, if you are “partially disabled,” if you are offered any job that OWCP believes you can do, you must accept it. On the other hand, under FERS/CSRS disability retirement laws, if you are partially disabled — meaning that you simply cannot do at least one or more of the essential elements of your job — then you are entitled to disability retirement benefits, and your agency or the Postal Service cannot simply offer you any job; they must offer you a job in the same pay or grade, and one in which you are qualified or, if you are in the Postal Service, then it must an accommodation in the same craft.

Controlling Your Future

Under OWCP, you have no control over your future – OWCP determines your future. Under OPM Disability Retirement, you can obtain disability retirement benefits, and then take control of your future and work at another job of your choice, make up to 80% of what your (former) position pays and still continue to receive your disability annuity.

Sincerely,

Robert R. McGill, Esquire
Federal Disability Lawyer

Robert R. McGill is an attorney who specializes in OPM Disability Retirement, a practice area he dedicates 100% of his time helping Federal and Postal workers secure their disability retirement benefits under both FERS and CSRS. For more information about his legal services, publications and forum, please visit his Federal Disability Retirement website.

Note: This article was originally published in Lawyers.com