Buyouts: Here today, gone tomorrow!

Remember the buyouts of the Clinton years? The one-size-fits-all, take as many as you like VSIPS (buyouts) and VERAs (early-retirement)? They seemed to be everywhere.

Tens of thousands of feds left — as planned or earlier than they anticipated — to pick up the maximum $25K (before deductions) buyouts.

If you remember them, that’s great. Now forget about them. It’s 2014, not the 1990s. Time to move on!

Proposed by the Clinton administration and administered by Congress, the first rounds of buyouts started in Defense. The amount of the buyout was, originally, calculated on what it would take to get a typical male wage-grade employee in Defense to take regular or early retirement. Buyouts soon spread to many other agencies from the super-secret National Security Administration to the more public Library Congress where people lined up on the sidewalk before opening hours to apply.


One purpose of the first rounds of buyouts was to target them toward blue-collar males at military bases, air bases, depots and shipyards. The buyouts were an inducement to get them to leave voluntarily. The other option would have been messy, costly reductions-in-force actions. That would have permitted military veterans — those for whom the buyouts were intended — to bump less senior employees, many of them women and minorities, out of their jobs. Although there were some RIFs, the vast majority of the downsizing was accomplished via buyouts and early-outs.

Now, buyouts are back. But in a very different form — and for a very different purpose. OPM, not Congress, now controls the buyout yea-or-nay process. And it’s resulted in more controlled, sometimes surgical buyouts, often based on location, type of job and, sometimes, limited to specific grade levels.

Despite inflation and hope-springs-eternal rumors on the Internet, the price tag on the buyout ($25,000 before all deductions) hasn’t changed. And won’t. No matter what your brother-in-law says, there is no “secret” bill pending in Congress to raise the buyout to $50,000, or to give credit for more time served to buyout-takers.

The face value of the buyouts is the same then as now (except in the Postal Service, where the amount has been whittled back, and payments in some cases made over a two-year period.)

But the base question is still the same. Would you take a $25,000 buyout if offered? Or do you prefer to wait for the delayed phased retirement program that agencies will be offering later this year, or early in 2015? If so…

Check out the two very different buyout programs being offered by the Transportation Security Administration vs. the long-running, you-need-a-score-card buyouts taking place in the U.S. Postal Service.

Also consider what Agriculture did last year — offering geographically-specific buyouts — and other agencies that limited the buyouts to certain grades. Often, at the GS-13 through -15 level.

There will, as predicted, be buyouts this year and next. For the most part, they will be quick-turnaround deals. You get an offer, decide quick then depart.

For a sneak preview of your—possible—upcoming buyout offer, look what agencies are doing right now, via our 2014 Buyout and Early Retirement Guide.


The official state exercise of Missouri is now the jumping jack, according to a bill signed into law by Gov. Jay Nixon.

(Source: Kansas City Star)


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