Changes

The "high-3" salary is usually the final 36 months of the employee's tenure, but may be an earlier period if an employee took a voluntary downgrade in pay.  The salary includes base pay, locality adjustments (pay increases to account for cost of living in certain metropolitan areas), and shift differentials, but does not include overtime (except for some categories involving mainly first responders), bonuses/awards, severance pay (including voluntary buyouts), cash out payments for unused annual leave and credit hours, or hazard pay.

The "high-3" salary is usually the final 36 months of the employee's tenure, but may be an earlier period if an employee took a voluntary downgrade in pay.  The salary includes base pay, locality adjustments (pay increases to account for cost of living in certain metropolitan areas), and shift differentials, but does not include overtime (except for some categories involving mainly first responders), bonuses/awards, severance pay (including voluntary buyouts), cash out payments for unused annual leave and credit hours, or hazard pay.

The system is structured to provide employees an incentive to continue working until age 62 (the earliest date at which an employee can also obtain Social Security benefits), as the annuity percentage is 1.1% for employees age 62 or older with at least 20 years service, and 1% for all others.

The system is structured to provide employees an incentive to continue working until age 62 (the earliest date at which an employee can also obtain Social Security benefits), as the annuity percentage is 1.1% for employees age 62 or older with at least 20 years service, and 1% for all others.  Also most employees retiring before age 62 will not receive a cost of living increase until age 62 (except for certain occupations where the mandatory retirement age is under 62, or employees retiring on disability).

Although unused sick leave is added to "creditable Federal service"<ref>The conversion is based on a chart, where 2,087 hours equals one full year, for an example of the chart see http://www.federalretirement.net/sickleavechart.htm.  If actual unused sick leave falls between two amounts, the higher amount is used.</ref>, it cannot be used to make an ineligible employee eligible for retirement, nor to make an employee eligible for the increased 1.1% percentage.

Although unused sick leave is added to "creditable Federal service"<ref>The conversion is based on a chart, where 2,087 hours equals one full year, for an example of the chart see http://www.federalretirement.net/sickleavechart.htm.  If actual unused sick leave falls between two amounts, the higher amount is used.</ref>, it cannot be used to make an ineligible employee eligible for retirement, nor to make an employee eligible for the increased 1.1% percentage.