If you are a federal employee or work for the postal service, your retirement system is the Federal Employees Retirement System (FERS). If you file for disability retirement benefits, the rules that govern eligibility and payout is FERS. Here’s how it works.
Are You Eligible?
Although it’s more difficult to qualify for Social Security disability benefits, FERS has specific and detailed eligibility requirements.
- You have paid into FERS for at least 18 months.
- While employed in a position that pays into FERS, you became disabled because of disease or injury “for useful and efficient service to your current position.” FERS uses this “useful and efficient service” line throughout its guidelines to mean that you’re unable to carry out an essential element of your job. In other words, are you disabled to the point where you can’t adequately perform your duties?
- Your disability is serious enough that it will likely last at least one year.
- The federal agency you work for tried to accommodate your disability or move you to another department at the same pay level within the same commuting area. And of course, it must be a transfer to a job you’re qualified for.
- You or your guardian must apply while you’re still employed or within one year after your separation. The only exception to this rule is for mental incompetence. If you are still employed, the application goes to your employing agency. If you’re already separated, it goes to the Office of Personnel Management.
- Finally, you have to also apply for Social Security disability benefits. It is not required that you are approved for SSDI, however.
One final note regarding eligibility: Unlike Social Security, you don’t have to prove that you’re totally disabled to receive federal disability retirement benefits. You can have another job in the private sector as long as you don’t earn more than 80% of your federal salary.
How Do You Apply?
Complete forms SF 3107, Application for Immediate Retirement, and SF 3112, Documentation in Support of Disability Retirement. These are on the Standard Forms section of OPM’s website. Some of the required documentation will include:
- Proof that your medical condition is incompatible with useful service.
- A medical condition resulting from a disease or injury; mental health issues can also qualify.
- Proof that the disease or disability has caused the deficiency of service in your current federal or Postal Service position.
- You became disabled while serving under FERS.
- Proof that you meet all requirements in the eligibility section above.
Collecting the evidence and documentation must be paid for by the applicant. You can’t ask OPM to pay for any of your medical appointments or procedures in order to establish proof.
How Much Will You Receive?
Like any government benefits program, the actual formula is complicated, but here’s the simple breakdown.
If you are 62 or older at retirement have less than 20 years of service—or you’re over 62 with more than 20 years of service and qualify for immediate voluntary retirement—you will receive 1.0% of your high-3 salary for each year of service, or 1.1% if you have more than 20 years of service. Your “high-3” average pay is the highest average basic pay you earned during any three consecutive years of service.
If your average salary over a consecutive three-year period was $60,000 and you worked under FERS for 18 years, you would take 18% of $60,000, so your annual benefit—as long as you are eligible—would be $10,800.
If you’re over 62 and ineligible for immediate voluntary retirement, you receive 60% of your high-3 average salary minus 100% of your Social Security benefit for any month you were eligible for Social Security benefits. After the first 12 months, it drops to 40% of high-3 minus 60% of your Social Security benefits.
What If You’re Denied Benefits?
If you submit your application but are denied, you can ask for reconsideration. Be prepared to add additional documentation to your case. If you’re denied again, you can appeal to the court system.
Can You Lose Your Benefits?
Yes. If your condition improves, you can lose your benefits. You may also be asked to periodically prove that you still qualify. Don’t assume that once you qualify, you will receive benefits for life.
Eligibility for Federal Disability Retirement Benefits is determined by you first reviewing the qualifications, completing the paperwork, and receiving the ruling. Be prepared to verify eligibility long after being approved.