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Disability Benefits & The Special Rules

Unfortunately, there are some federal employees that can end up developing a physical or mental condition making it difficult (if not impossible) to continue with their service. Once their condition is confirmed and is expected to carry on for at least a year or more, these federal employees are eligible to apply for disability retirement. For permanent disability, once the benefits are granted they usually aren’t reviewed again. But, if it isn’t determined to be permanent, then periodic medical evaluations will be a requirement until the employee reaches the age of 60.

Under both federal retirement systems (FERS and CSRS), the benefits of disability are payable if you are disabled to the point where you cannot carry out efficient and useful tasks in your position. However, the length of service years required for eligibility to apply for disability retirement is different for both members of FERS and CSRS. While an employee of FERS needs to have finished eighteen months of civilian service, an employee of CSRS, on the other hand, must have completed five years.

To apply for disability retirement, you need to send the necessary paperwork to OPM. This can be done with assistance from your agency, and your agency needs to confirm that it cannot accommodate your situation in your present position, or in any other position that is in the same pay and grade.

CSRS Offset or employees of FERS also needs to apply to the Social Security Administration (SSA) for disability retirement. The SSA has a different (much higher) standard which they go by to determine if you are disabled or not. Their rules require you to be severely disabled and unable to carry out your duties as an employee.

Note that disability retirement is a different benefit on its own as its separate from the compensation provided by the Federal Employees Compensation Act, which is run by the Labor Department and covers only the injuries or illnesses related to work. Ideally, if you qualify for both federal disability retirement and FECA benefits, you will have to make a choice between the two.

As someone who is a disabled worker, how much of a benefit could you receive? As an employee of CSRS, you will be given about 40 percent of your “high-3” years of average pay, or an amount totaled from your actual service from the date your disability retirement began, up until age 60. The 40 percent calculation is the minimum you would receive, but if the calculation of your service credit gets you approval for more, you will receive that amount.

If you are below the age of 62 and you are a FERS employee, in the first twelve months, you will be paid 60 percent of your “high-3” average salary minus 100 percent of the benefit for social security disability.

Regardless of if you are an employee of FERS or CSRS, if the benefits you earned based on your service years is more than these figures, you will receive a higher amount. When you are 62 years of age, your benefits package will be determined as you worked from when your disability started till when you clocked 62.

If you still have questions about disability retirement, please seek assistance from a financial professional.