Federal Worker Happy Fun Times: VSIP edition

Greetings epaulets. I have seen Yet Another News Screed about HHS offering Big Big Buyouts to their employees, and I feel like the journalists didn’t really understand what was going on (or at least didn’t match MY perspective) so I thought I would give it (my perspective) as a federal employee.

Abstract: I feel very few people in the federal government who are not already close to retirement age are going to take a VSIP Buyout. VSIP (Voluntary Separation Incentive Payments) are most often paired with VERA (Voluntary Early Retirement Authority) because if one retires early, one probably won’t get age-based full benefits from things like Social Security/Medicaid/Medicare, so VSIP is a literal stack of cash to help early retirees cover the gaps until reaching full retirement age, or at least get them closer to it. Separating (firing, laying off) a non-probationary employee in a RIF (reduction in force), especially one who has been around a while will pay out WAY MORE than any VSIP ever would.

More Info: Federal Employees below a certain level (GS-15, about the same as a Colonel in the army/navy/etc) are famously Hard To Fire. But this is because they are Hard To Hire: There are lots of laws around hiring federal employees due to merit and also lots of civil rights/equal opportunity employment that basically boils down to “If it can be proven to a judge/jury that you hired This Employee due to Favoritism over an equally or better qualified candidate, especially someone who doesn’t look/act like the rest of the workforce, double especially a veteran… you are in trouble with The Law.” Also, Federal Government doesn’t pay as much as Industry, but usually, has better benefits than industry and is generally way more stable and less chaotic (current administration notwithstanding).

One of the ways that stability is traditionally maintained is a “Get rid of positions, but keep the people” attitude, even with a Reduction In Force: When asked to handle a RIF, the first thing the administrations of the various departments do is look at all the positions that are new and required and open, and all the positions that are old and about to be removed when whomever is working them retires or moves to a different position, and force that transition along. Old RIFs were where lots of people got moved from “Typing Pool/File-Clerk/Secretary” positions to “Data Entry/Data Management/Admin assistant” ones. Most of the people stayed and got some new training, lots of old positions stopped getting paid for, and lots of new positions got filled without actually having to go through the rigmarole of hiring new people. Some of the other tools of the RIF are to rush folks who have been around into retirement, thus opening up lots of positions in the government for employees about to vacate jobs going away. Hence VERA (the ability to go “hey, you can retire NOW with pension/federal-retirement instead of waiting another __ years”) and VSIP (While you will be getting pension/federal-retirement, you won’t be getting medicare/medicaid/social-security… so here’s a stack of cash to cover the gap). Thus the end result is Congress is no longer on the hook to pay for both old positions and new ones, the workforce is upgraded, and the institutional knowledge that was lost was mostly people who were going to retire within the next administration anyways.

Finally, if there are still more employees than positions, separations/layoffs happen… but just so whatever administration doesn’t cut positions willy-nilly, laying off employees, especially ones who have been around a while, is EXPENSIVE: Severance is MASSIVE (up to a year in salary, 60 days notice). While some non-retiring employees may want to take a VSIP (IE, they were already ready to retire or leave federal service but weren’t with the government very long to warrant a payout should they get fired), the cases are rare.

The other consideration, of course, is the current admin might try to change or ignore the law to really reduce the severance payouts, if not eliminate them entirely. There are already several legal challenges to the “Fork in the Road” separation incentive (essentially, 8 months of severance, employee chosen) as a massive violation of the anti-deficiency act (“You cannot have congress spend money they didn’t approve spending”… and telling federal workers they can Not Do A Job that congress created for them for 8 months while they collect checks seems… very that)… but I, like most federal employees are willing to bet with the house over the boastful new gambler in town.