Office of the General Counsel

Matter of: [XXX]
File Number: S9701143

OPM Contact: Murray M. Meeker

On October 8, 1997, an employee of the [agency], submitted a claim for severance pay. The employee reported that, while he was not scheduled to separate from his position in the Office of [name] at [agency] until January 12, 1998 [originally November 7, 1997], [agency] had already determined that he would not be entitled to severance pay. OPM concurs with [agency] and denies the employee's claim.

Congress has provided that for purposes of entitlement to severance pay, "employee" does not include:

... an employee who is subject to subchapter III of chapter 83 of this title or any other retirement statute or retirement system applicable to an employee ... or a member of a uniformed service and who, at the time of separation from the service, has fulfilled the requirements for immediate annuity under such a statute or system....

5 U.S.C. 5595(a)(2)(iv).

As of the date of the employee's separation from [agency], he will have already fulfilled the requirements for retired pay. Indeed, the employee has already begun to receive retired pay as authorized under 10 U.S.C. 12731 based on 23 years of qualifying service with the [military agency]. The issue in this case is whether the military retired pay that he began receiving when he reached age 60 on October 1, 1996, three years after his separation from the [military agency] on April 1, 1993, constitutes an immediate annuity under section 5595. It is our determination that it does.

The legislative history of section 5595 clarifies that it was the intent of Congress to exclude:

Any employee who at the time of separation is receiving or eligible to receive retirement benefits under any Federal civilian or military retirement program.

S.Rept. No. 910, 89th Cong., 1st Sess. 8, 9.

Congress did not save from exclusion, those individuals such as the claimant whose military retirement benefits had been deferred.

Our determination is in accordance with 54 Comp. Gen. 212 (1974), wherein the Comptroller General concluded that the exclusion in section 5595(a)(2)(iv) applied to any employee who at the time of separation from their civilian position is receiving retirement benefits under any federal military or civilian retirement program. Our determination is also consistent with the regulations implementing section 5595 which define "immediate annuity" to mean:

A recurring benefit payable under a Federal civilian or military retirement system that begins to accrue within 1 month after separation [from civilian service]....

5 C.F.R. 550.703.