RI30-002 Citations

§ 8453

TITLE 5—GOVERNMENT ORGANIZATION AND EMPLOYEES

during which the annuitant was entitled to an
annuity under this subchapter; and
(ii) the average pay which would otherwise
be used shall be adjusted to reflect all adjustments made under section 8462(b) with respect
to any period (or periods) referred to in clause
(i) (without regard to whether the annuitant’s
annuity was affected by any of those adjustments).
(c) Except as provided in subsection (d), the
annuity of an annuitant under this subchapter
shall be computed under section 8415 if—
(1) such annuity commences, or is restored,
beginning on or after the redetermination date
of the annuitant; or
(2) as of the day on which such annuity commences, or is restored, the annuitant satisfies
the age and service requirements for entitlement to an annuity under section 8412 (other
than subsection (g) of such section).
(d)(1) The annuity to which an annuitant is entitled under this section (after the reduction
under subsection (a)(2), if applicable, has been
made) shall not be less than the amount of an
annuity computed under section 8415 (excluding
subsection (g) of such section).
(2) In applying this subsection with respect to
any annuitant, the amount of an annuity so
computed under section 8415 shall be adjusted
under section 8462 (including subsection (c)
thereof)—
(A) to the same extent, and otherwise in the
same manner, as if it were an annuity—
(i) subject to adjustment under such section; and
(ii) with a commencement date coinciding
with the date the annuitant’s annuity commenced or was restored under this subchapter, as the case may be; and
(B) whether the amount actually payable to
the annuitant under this section in any month
is determined under this subsection or otherwise.
(Added Pub. L. 99–335, title I, § 101(a), June 6,
1986, 100 Stat. 566; amended Pub. L. 99–556, title
I, §§ 104, 106, Oct. 27, 1986, 100 Stat. 3131, 3132;
Pub. L. 100–238, title I, § 122(a)–(c), Jan. 8, 1988,
101 Stat. 1753, 1754; Pub. L. 108–176, title II,
§ 226(b)(2)(B), Dec. 12, 2003, 117 Stat. 2530.)
REFERENCES IN TEXT
Sections 223 and 224 of the Social Security Act, referred to in subsec. (a)(2), are classified to sections 423
and 424a, respectively, of Title 42, The Public Health
and Welfare.
AMENDMENTS
2003—Subsec. (d)(1). Pub. L. 108–176 substituted ‘‘subsection (g)’’ for ‘‘subsection (f)’’.
1988—Subsec. (a)(1)(B). Pub. L. 100–238, § 122(c)(2)(A),
amended subpar. (B) generally. Prior to amendment,
subpar. (B) read as follows: ‘‘An annuity computed
under this paragraph shall not, for purposes of any adjustment under section 8462 (including any adjustment
under subsection (c)(1) of such section), be considered
to have commenced until after such annuity ceases to
be determined under subparagraph (A)(i).’’
Subsec. (a)(2)(B)(i). Pub. L. 100–238, § 122(a), amended
cl. (i) generally. Prior to amendment, cl. (i) read as follows: ‘‘For purposes of this paragraph, the assumed disability insurance benefit of an annuitant for any month
shall be equal to—

Page 890

‘‘(I) the amount of the disability insurance benefit
to which the annuitant would have been entitled
under section 223 of the Social Security Act for the
month in which the annuity under this subchapter
commenced, or was restored, determined as if such
annuitant had then satisfied all requirements for entitlement to a benefit under such section, adjusted by
‘‘(II) all adjustments made under section 8462(b) between the date on which the annuity commenced, or
was restored, and the start of the month involved
(without regard to whether the annuitant’s annuity
was affected by any of those adjustments).
For purposes of computing the assumed disability insurance benefit, the month in which the annuitant’s
disability began (as determined under section
216(i)(2)(C) of the Social Security Act) shall be the
month in which the annuity commenced or, if earlier
(and if a determination was actually made) the month
determined under such section.’’
Subsec. (a)(3). Pub. L. 100–238, § 122(c)(2)(B), added par.
(3).
Subsec. (b). Pub. L. 100–238, § 122(b), amended subsec.
(b) generally, substituting pars. (1) and (2) for former
pars. (1) to (4).
Subsec. (d). Pub. L. 100–238, § 122(c)(1), designated existing provisions as par. (1) and added par. (2).
1986—Subsec. (b)(3). Pub. L. 99–556, § 106, substituted
‘‘(a)(1)(A)(i)’’ for ‘‘(a)(1)(A)’’ in second sentence.
Subsec. (d). Pub. L. 99–556, § 104, inserted ‘‘(after the
reduction under subsection (a)(2), if applicable, has
been made)’’.
EFFECTIVE DATE OF 2003 AMENDMENT
Amendment by Pub. L. 108–176 effective on 60th day
after Dec. 12, 2003, and applicable with respect to any
annuity entitlement based on an individual’s separation from service occurring on or after such effective
date, and any service performed by any such individual
before, on, or after such effective date, subject to special rule relating to deposit requirement, see section
226(c) of Pub. L. 108–176, set out as a note under section
8401 of this title.
EFFECTIVE DATE OF 1988 AMENDMENT
Section 122(d) of Pub. L. 100–238 provided that: ‘‘The
amendments made by this section [amending this section] shall be effective as of January 1, 1987, as if they
had been enacted as part of the Federal Employees’ Retirement System Act of 1986 (Public Law 99–335; 100
Stat. 514 and following).’’

§ 8453. Application
A claim may be allowed under this subchapter
only if application is filed with the Office before
the employee or Member is separated from the
service or within 1 year thereafter. This time
limitation may be waived by the Office for an
employee or Member who, at the date of separation from service or within 1 year thereafter, is
mentally incompetent if the application is filed
with the Office within 1 year from the date of
restoration of the employee or Member to competency or the appointment of a fiduciary,
whichever is earlier.
(Added Pub. L. 99–335, title I, § 101(a), June 6,
1986, 100 Stat. 568.)
§ 8454. Medical examination
An annuitant receiving a disability retirement
annuity from the Fund shall be examined under
the direction of the Office—
(1) at the end of 1 year from the date of the
disability retirement; and
(2) annually thereafter until becoming 60
years of age;

Page 891

TITLE 5—GOVERNMENT ORGANIZATION AND EMPLOYEES

unless the disability is permanent in character.
If the annuitant fails to submit to examination
as required by this section, payment of the annuity shall be suspended until continuance of
the disability is satisfactorily established.
(Added Pub. L. 99–335, title I, § 101(a), June 6,
1986, 100 Stat. 568.)
§ 8455. Recovery; restoration of earning capacity
(a)(1) If an annuitant receiving a disability retirement annuity from the Fund recovers from
the disability before becoming 60 years of age,
payment of the annuity terminates on reemployment by the Government or 1 year after the
date on which the Office determines that the annuitant has recovered, whichever is earlier.
(2) If an annuitant receiving a disability annuity from the Fund, before becoming 60 years of
age, is restored to an earning capacity fairly
comparable to the current rate of pay of the position occupied at the time of retirement, payment of the annuity terminates 180 days after
the end of the calendar year in which earning
capacity is so restored. Earning capacity is
deemed restored if in any calendar year the income of the annuitant from wages or self-employment or both equals at least 80 percent of
the current rate of pay of the position occupied
immediately before retirement.
(b)(1) If an annuitant whose annuity is terminated under subsection (a) is not reemployed in
a position in which that individual is subject to
this chapter, such individual is deemed, except
for service credit, to have been involuntarily
separated from the service for the purpose of
subchapter II of this chapter as of the date of
termination of the disability annuity, and after
that termination is entitled to annuity under
the applicable provisions of such subchapter.
(2) If an annuitant whose annuity is terminated under subsection (a)(2)—
(A) is not reemployed in a position subject
to this chapter; and
(B) has not recovered from the disability for
which that individual was retired;
the annuity of such individual shall be restored
at the applicable rate under section 8452 effective the first of the year following any calendar
year in which such individual’s income from
wages or self-employment or both is less than 80
percent of the current rate of pay of the position
occupied immediately before retirement.
(3) If an annuitant whose annuity is terminated because of a medical finding that the individual has recovered from disability is not reemployed in a position in which such individual is
subject to this chapter, the annuity of such individual shall be restored at the applicable rate
under section 8452 effective from the date on
which the Office determines that there has been
a recurrence of the disability.
(4) Paragraphs (2) and (3) shall not apply in the
case of an annuitant receiving an annuity from
the Fund under subchapter II of this chapter.
(Added Pub. L. 99–335, title I, § 101(a), June 6,
1986, 100 Stat. 568.)
§ 8456. Military reserve technicians
(a)(1) Except as provided in paragraph (2) or
(3), an individual shall be retired under this subchapter if the individual—

§ 8456

(A) is separated from employment as a military reserve technician by reason of a disability that disqualifies the individual from membership in a reserve component of the Armed
Forces specified in section 10101 of title 10 or
from holding the military grade required for
such employment;
(B) is not considered to be disabled under
section 8451(a)(1)(B);
(C) is not appointed to a position in the Government (whether under subsection (b) or
otherwise); and
(D) has not declined an offer of an appointment to a position in the Government under
subsection (b).
(2) Payment of any annuity for an individual
pursuant to this section terminates—
(A) on the date the individual is appointed
to a position in the Government (whether pursuant to subsection (b) or otherwise);
(B) on the date the individual declines an
offer of appointment to a position in the Government under subsection (b); or
(C) as provided under section 8455(a).
(3) An individual eligible to retire under section 8414(c) shall not be eligible to retire under
this section.
(b) Any individual applying for or receiving
any annuity pursuant to this section shall, in
accordance with regulations prescribed by the
Office, be considered by any agency of the Government before any vacant position in the agency is filled if—
(1) the position is located within the commuting area of the individual’s former position;
(2) the individual is qualified to serve in
such position, as determined by the head of
the agency; and
(3) the position is at the same grade or
equivalent level as the position from which
the individual was separated.
(Added Pub. L. 99–335, title I, § 101(a), June 6,
1986, 100 Stat. 570, § 8457; amended Pub. L. 99–556,
title I, § 118, Oct. 27, 1986, 100 Stat. 3134; renumbered § 8456, Pub. L. 100–238, title I, § 124(b)(1)(B),
Jan. 8, 1988, 101 Stat. 1756; Pub. L. 103–337, div. A,
title XVI, § 1677(a)(4), Oct. 5, 1994, 108 Stat. 3019.)
PRIOR PROVISIONS
A prior section 8456, added Pub. L. 99–355, title I,
§ 101(a), June 6, 1986, 100 Stat. 569, related to relationship between annuity and workers’ compensation, prior
to repeal by Pub. L. 100–238, title I, § 124(b)(1)(A), Jan.
8, 1988, 101 Stat. 1756. See section 8464a of this title.
AMENDMENTS
1994—Subsec. (a)(1)(A). Pub. L. 103–337 substituted
‘‘section 10101’’ for ‘‘section 261(a)’’.
1988—Pub. L. 100–238 renumbered section 8457 of this
title as this section.
1986—Subsec. (a)(1)(C), (D), (2)(A), (B). Pub. L. 99–556
substituted ‘‘subsection (b)’’ for ‘‘subsection (c)’’.
EFFECTIVE DATE OF 1994 AMENDMENT
Amendment by Pub. L. 103–337 effective Dec. 1, 1994,
except as otherwise provided, see section 1691 of Pub. L.
103–337, set out as an Effective Date note under section
10001 of Title 10, Armed Forces.

§ 8337

TITLE 5—GOVERNMENT ORGANIZATION AND EMPLOYEES

‘‘(d) REGULATIONS.—The Comptroller General shall
prescribe any regulations necessary to carry out this
section, including regulations under which an early retirement offer may be made to any employee or group
of employees based on—
‘‘(1) geographic area, organizational unit, or occupational series or level;
‘‘(2) skills, knowledge, or performance; or
‘‘(3) such other similar factors (or combination of
factors described in this or any other paragraph of
this subsection) as the Comptroller General considers
necessary and appropriate in order to achieve the
purpose involved.
‘‘(e) SENSE OF CONGRESS.—It is the sense of Congress
that the implementation of this section is intended to
reshape the Government Accountability Office workforce and not downsize the Government Accountability
Office workforce.’’
APPLICATION OF SUBSECTION (d)(2)
Pub. L. 105–174, title III, § 7001(a), May 1, 1998, 112
Stat. 91, as amended by Pub. L. 106–58, title VI, § 651(a),
Sept. 29, 1999, 113 Stat. 480, which provided that, effective May 1, 1998, subsec. (d)(2) of this section was to be
applied as if it read as specified in Pub. L. 105–174,
§ 7001(a), was repealed by Pub. L. 107–296, title XIII,
§ 1313(b)(4), Nov. 25, 2002, 116 Stat. 2296.
INDIAN PREFERENCE LAWS APPLICABLE TO BUREAU OF
INDIAN AFFAIRS AND INDIAN HEALTH SERVICE POSITIONS

Nonapplicability of annuity provisions of subsec. (j)
of this section to individuals accepting waiver of Indian
preference laws with respect to personnel actions, see
section 472a(c)(2) of Title 25, Indians.
INDIVIDUALS ENTITLED TO ANNUITY PAYMENTS FOR
PERIOD PRIOR TO OCTOBER 1, 1979
Section 1241(b)(2) of Pub. L. 96–70 provided that: ‘‘Effective October 1, 1979, any individual who, but for
paragraph (1) of this subsection [set out as an Effective
Date of 1979 Amendment note above], would have been
entitled to one or more annuity payments pursuant to
the amendments made by this section [amending this
section] for periods before October 1, 1979, shall be entitled, to such extent or in such amounts as are provided
in advance in appropriation Acts, to a lump sum payment equal to the total amount of all such annuity
payments.’’

§ 8337. Disability retirement
(a) An employee who completes 5 years of civilian service and has become disabled shall be
retired on the employee’s own application or on
application by the employee’s agency. Any employee shall be considered to be disabled only if
the employee is found by the Office of Personnel
Management to be unable, because of disease or
injury, to render useful and efficient service in
the employee’s position and is not qualified for
reassignment, under procedures prescribed by
the Office, to a vacant position which is in the
agency at the same grade or level and in which
the employee would be able to render useful and
efficient service. For the purpose of the preceding sentence, an employee of the United States
Postal Service shall be considered not qualified
for a reassignment described in that sentence if
the reassignment is to a position in a different
craft or is inconsistent with the terms of a collective bargaining agreement covering the employee. A judge of the United States Court of
Appeals for the Armed Forces who completes 5
years of civilian service and who is found by the
Office to be disabled for useful and efficient

Page 764

service as a judge of such court or who is removed for mental or physical disability under
section 942(c) of title 10 shall be retired on the
judge’s own application or upon such removal. A
Member who completes 5 years of Member service and is found by the Office to be disabled for
useful and efficient service as a Member because
of disease or injury shall be retired on the Member’s own application. An annuity authorized by
this section is computed under section 8339(g) of
this title, unless the employee or Member is eligible for a higher annuity computed under section 8339(a) through (e), (n), (q), (r), or (s).
(b) A claim may be allowed under this section
only if the application is filed with the Office
before the employee or Member is separated
from the service or within 1 year thereafter.
This time limitation may be waived by the Office for an employee or Member who at the date
of separation from service or within 1 year
thereafter is mentally incompetent, if the application is filed with the Office within 1 year from
the date of restoration of the employee or Member to competency or the appointment of a fiduciary, whichever is earlier.
(c) An annuitant receiving disability retirement annuity from the Fund shall be examined
under the direction of the Office—
(1) at the end of 1 year from the date of the
disability retirement; and
(2) annually thereafter until he becomes 60
years of age;
unless his disability is permanent in character.
If the annuitant fails to submit to examination
as required by this section, payment of the annuity shall be suspended until continuance of
the disability is satisfactorily established.
(d) If an annuitant receiving disability retirement annuity from the Fund, before becoming 60
years of age, recovers from his disability, payment of the annuity terminates on reemployment by the Government or 1 year after the date
of the medical examination showing the recovery, whichever is earlier. If an annuitant receiving disability retirement annuity from the
Fund, before becoming 60 years of age, is restored to an earning capacity fairly comparable
to the current rate of pay of the position occupied at the time of retirement, payment of the
annuity terminates on reemployment by the
Government or 180 days after the end of the calendar year in which earning capacity is so restored, whichever is earlier. Earning capacity is
deemed restored if in any calendar year the income of the annuitant from wages or self-employment or both equals at least 80 percent of
the current rate of pay of the position occupied
immediately before retirement.
(e) If an annuitant whose annuity is terminated under subsection (d) of this section is not
reemployed in a position in which he is subject
to this subchapter, he is deemed, except for service credit, to have been involuntarily separated
from the service for the purpose of this subchapter as of the date of termination of the disability annuity, and after that termination is
entitled to annuity under the applicable provisions of this subchapter. If an annuitant whose
annuity is heretofore or hereafter terminated
because of an earning capacity provision of this
subchapter or an earlier statute—

Page 765

TITLE 5—GOVERNMENT ORGANIZATION AND EMPLOYEES

(1) is not reemployed in a position in which
he is subject to this subchapter; and
(2) has not recovered from the disability for
which he was retired;
his annuity shall be restored at the same rate
effective the first of the year following any calendar year in which his income from wages or
self-employment or both is less than 80 percent
of the current rate of pay of the position occupied immediately before retirement. If an annuitant whose annuity is heretofore or hereafter
terminated because of a medical finding that he
has recovered from disability is not reemployed
in a position in which he is subject to this subchapter, his annuity shall be restored at the
same rate effective from the date of medical examination showing a recurrence of the disability. The second and third sentences of this subsection do not apply to an individual who has
become 62 years of age and is receiving or is eligible to receive annuity under the first sentence
of this subsection.
(f)(1) An individual is not entitled to receive—
(A) an annuity under this subchapter, and
(B) compensation for injury to, or disability
of, such individual under subchapter I of chapter 81, other than compensation payable under
section 8107,
covering the same period of time.
(2) An individual is not entitled to receive an
annuity under this subchapter and a concurrent
benefit under subchapter I of chapter 81 on account of the death of the same person.
(3) Paragraphs (1) and (2) do not bar the right
of a claimant to the greater benefit conferred by
either this subchapter or subchapter I of chapter
81.
(g) If an individual is entitled to an annuity
under this subchapter, and the individual receives a lump-sum payment for compensation
under section 8135 based on the disability or
death of the same person, so much of the compensation as has been paid for a period extended
beyond the date payment of the annuity commences, as determined by the Department of
Labor, shall be refunded to that Department for
credit to the Employees’ Compensation Fund.
Before the individual may receive the annuity,
the individual shall—
(1) refund to the Department of Labor the
amount representing the commuted compensation payments for the extended period; or
(2) authorize the deduction of the amount
from the annuity.
Deductions from the annuity may be made from
accrued or accruing payments. The amounts deducted and withheld from the annuity shall be
transmitted to the Department of Labor for reimbursement to the Employees’ Compensation
Fund. When the Department of Labor finds that
the financial circumstances of an individual entitled to an annuity under this subchapter warrant deferred refunding, deductions from the annuity may be prorated against and paid from accruing payments in such manner as the Department determines appropriate.
(h)(1) As used in this subsection, the term
‘‘technician’’ means an individual employed
under section 709(a) of title 32 or section 10216 of
title 10 who, as a condition of the employment,

§ 8337

is required under section 709(b) of title 32 or section 10216 of title 10, respectively, to be a member of the Selected Reserve.
(2)(A) Except as provided in subparagraph (B)
of this paragraph, an individual shall be retired
under this section if the individual—
(i) is separated from employment as a technician under section 709(e)(1) of title 32 or section 10216 of title 10 by reason of a disability
that disqualifies the individual from membership in the Selected Reserve;
(ii) is not considered to be disabled under the
second sentence of subsection (a) of this section;
(iii) is not appointed to a position in the
Government (whether under paragraph (3) of
this subsection or otherwise); and
(iv) has not declined an offer of an appointment to a position in the Government under
paragraph (3) of this subsection.
(B) Payment of any annuity for an individual
pursuant to this subsection terminates—
(i) on the date the individual is appointed to
a position in the Government (whether pursuant to paragraph (3) of this subsection or
otherwise);
(ii) on the date the individual declines an
offer of appointment to a position in the Government under paragraph (3); or
(iii) as provided under subsection (d).
(3) Any individual applying for or receiving
any annuity pursuant to this subsection shall,
in accordance with regulations prescribed by the
Office, be considered by any agency of the Government before any vacant position in the agency is filled if—
(A) the position is located within the commuting area of the individual’s former position;
(B) the individual is qualified to serve in
such position, as determined by the head of
the agency; and
(C) the position is at the same grade or
equivalent level as the position from which
the individual was separated under section
709(e)(1) of title 32 or section 10216 of title 10.
(Pub. L. 89–554, Sept. 6, 1966, 80 Stat. 572; Pub. L.
90–83, § 1(76), Sept. 11, 1967, 81 Stat. 214; Pub. L.
95–454, title IX, § 906(a)(2), (3), Oct. 13, 1978, 92
Stat. 1224; Pub. L. 96–499, title IV, § 403(a), Dec.
5, 1980, 94 Stat. 2605; Pub. L. 97–253, title III,
§ 302(a), Sept. 8, 1982, 96 Stat. 792; Pub. L. 98–94,
title XII, § 1256(c), Sept. 24, 1983, 97 Stat. 701;
Pub. L. 100–238, title I, § 124(a)(1)(A), Jan. 8, 1988,
101 Stat. 1755; Pub. L. 101–189, div. A, title XIII,
§ 1304(b)(2), Nov. 29, 1989, 103 Stat. 1577; Pub. L.
101–428, § 2(d)(1), Oct. 15, 1990, 104 Stat. 929; Pub.
L. 102–378, § 2(61), Oct. 2, 1992, 106 Stat. 1354; Pub.
L. 103–337, div. A, title IX, § 924(d)(1)(A), Oct. 5,
1994, 108 Stat. 2832; Pub. L. 105–61, title V,
§ 516(a)(2), Oct. 10, 1997, 111 Stat. 1306; Pub. L.
106–65, div. A, title V, § 522(d), Oct. 5, 1999, 113
Stat. 597; Pub. L. 106–553, § 1(a)(2) [title III,
§ 308(h)(1)], Dec. 21, 2000, 114 Stat. 2762, 2762A–88.)

§ 831.1209

5 CFR Ch. I (1–1–09 Edition)

period pending termination of the disability retirement benefit under paragraph (c), (d), or (e) of this section,
OPM will terminate the annuity effective on the date of reemployment.

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§ 831.1209 Termination of disability
annuity because of restoration to
earning capacity.
(a) Restoration to earning capacity. If a
disability annuitant is under age 60 on
December 31 of any calendar year and
his or her income from wages or selfemployment or both during that calendar year equal at least 80 percent of
the current rate of basic pay of the position occupied immediately before retirement, the annuitant’s earning capacity is considered to be restored. The
disability annuity will terminate on
the June 30 after the end of the calendar year in which earning capacity is
restored. When an agency reemploys a
restored disability annuitant at any
grade or rate of pay within the 180-day
waiting period pending termination of
the disability retirement benefit, OPM
will terminate the annuity effective on
the date of reemployment.
(b) Current rate of basic pay for the position occupied immediately before retirement. (1) A disability annuitant’s income for a calendar year is compared
to the gross annual rate of basic pay in
effect on December 31 of that year for
the position occupied immediately before retirement. The income for most
disability annuitants is based on the
rate for the grade and step which reflects the total amount of basic pay
(both the grade and step and any additional basic pay) in effect on the date
of separation from the agency for disability retirement. Additional basic
pay is included subject to the premium
pay restrictions of 5 U.S.C. 5545 (c)(1)
and (c)(2). A higher grade and step will
be established if it results from using
either the date of application for disability retirement or the date of reasonable accommodation, as adjusted by
any increases in basic pay that would
have been effected between each respective date and the date of final separation. Use of these two alternative
pay setting methods is subject to paragraph (b)(1) (i) and (ii) of this section.
The highest grade and step established
as a result of setting pay under the

normal method and the two alternative
methods is designated as the rate of
basic pay for the position occupied immediately before retirement and applies only to restoration to earning capacity decisions. In cases involving use
of either of the two alternative pay setting methods, the determination of the
rate of basic pay for the position occupied immediately before retirement is
made by the employing agency at the
time the disability retirement is allowed. OPM must review the rate so determined to establish whether the correct rate has been established, and will
inform the employee of the proper rate
at the time the disability annuity is
awarded. This rate of basic pay becomes the basis for all future earning
capacity determinations.
(i) The ‘‘date of application for disability retirement’’ is the date the application is signed by the authorized
official of the employing agency immediately before forwarding the application to OPM.
(ii) The ‘‘date of reasonable accommodation’’ is the date of the employing
agency’s notice of reasonable accommodation to an employee’s medical
condition (as a result of its review of
medical documentation) which results
in a reduction in the rate of basic pay.
The use of the date of reasonable accommodation to establish the rate of
basic pay for the position held at retirement is subject to the following
conditions:
(A) The date of the employing agency’s notice to provide accommodation
is no more than 1 year before the date
the disability retirement application is
signed by the authorized official in the
employing agency immediately before
forwarding it to OPM; and
(B) A complete record of the date of
the personnel decision, the medical
documentation substantiating the existence of the medical condition, and
the justification for the accommodation is established in writing and included at the time the agency submits
the application for disability retirement. OPM will review the record to
determine whether the medical documentation demonstrates that the medical condition existed at the time of
the accommodation and warranted the
accommodation made.

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Office of Personnel Management

§ 831.1209

(2) In the case of an annuitant whose
basic pay rate on the date determined
under paragraph (b)(1) of this section
did not match a specific grade and step
in a pay schedule:
(i) For those retiring from a merit
pay position, a position for which a
special pay rate is authorized (except
as provided in paragraph (b)(2)(ii) of
this section), or any other position in
which the rate of basic pay is not equal
to a grade and step in a pay schedule,
the grade and step will be established
for this purpose at the lowest step in
the pay schedule grade that is equal to
or greater than the actual rate of basic
pay payable. This rule will not be applied when the rate exceeds that of the
schedule applicable to the organization
from which the individual retired,
when there is no existing apposite
schedule with grades and steps, or in
other organizations which are excluded
from coverage of schedules with grades
and steps, as in the case of pay systems
using pay bands.
(ii) For those retiring with a retained
rate of basic pay or from a position for
which a special pay rate is in effect but
whose rate of basic pay exceeds the
highest rate payable in the pay schedule grade applicable to the position
held, the grade and step is established
for this purpose in the grade in the
schedule that is closest to the grade of
the position held and within which the
amount of the retained pay falls. The
step is established for this purpose at
the lowest step in that grade which
equals or exceeds the actual rate of pay
payable.
(iii) When the pay system under
which an annuitant retired has been either modified or eliminated since the
individual retired, the individual will
be treated as if he or she had been employed at their retirement grade and
step at the time of the system change,
and will be deemed to have been placed
under the new system using whatever
rules would have been applicable at
that time. This will only apply when a
pay system has been abolished or modified, and not when the grade and step
of a position has been modified subsequent to retirement by reclassification
or other action, in which case the
grade and step in effect at the time of
retirement will control.

(iv) If using the above rules it is not
possible to set a grade and step for
computing the current rate of pay,
then if possible the current rate of pay
will be set using the relative position
in the range of pay applicable to the
position from which the individual retired. For example, if at the time of retirement the rate of pay was $75,000 in
a range from $70,000 to $90,000, for all
future determinations, the current rate
of pay would be 25% up the new pay
range from the bottom. If the new
range was $96,000 to $120,000, then the
new current rate of pay would be
$102,000 ($96,000 plus 0.25 times $24,000
($120,000 minus $96,000)).
(v) In those cases, such as of some
former Congressional staff employees
and others whose pay is not set under
a formal system, where none of the
above guidelines will yield a current
rate of pay, OPM will ascertain the
current rate of pay after consultation
with the former employing organization, or successor organization.
(3) For annuitants retiring from the
United States Postal Service, only
cost-of-living allowances subject to
civil service retirement deductions are
included in determining the current
rate of basic pay of the position held at
retirement.
(c) Income. Earning capacity for the
purposes of this section is demonstrated by an annuitant’s ability to
earn post-retirement income in a calendar year through personal work efforts or services. The total amount of
income from all sources is used to determine earning capacity. This includes income received as gross wages
from one or more employers, net earnings from one or more self-employment
endeavors, and deferred income that is
earned in a calendar year. In determining an annuitant’s income for a
calendar year, the following considerations apply:
(1) There are two sources of income:
wages and self-employment income. All
income which is subject to Federal employment taxes (i.e., social security or
Medicare taxes) or self-employment
taxes constitutes earned income. In addition, any other income as described
in this section also constitutes earned
income. The determination of whether
a disability annuitant earns wages as

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§ 844.401

5 CFR Ch. I (1–1–09 Edition)

credit for all periods before the annuitant’s 62nd birthday during which he
or she was entitled to an annuity under
this part. The average pay used in computing the annuity under 5 U.S.C. 8415
is adjusted by all cost-of-living increases effective under 5 U.S.C. 8462(b)
during the period the annuitant was receiving the disability annuity under
this part.

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Subpart D—Termination and
Reinstatement of Disability Annuity
§ 844.401 Recovery from disability.
(a) Each annuitant receiving disability annuity from the Fund shall be
examined under the direction of OPM
at the end of one year from the date of
disability retirement and annually
thereafter until the annuitant becomes
60 years of age unless the disability is
found by OPM to be permanent in character. OPM may order a medical or
other examination at any time to determine the facts relative to the nature
and degree of disability of the annuitant. Failure to submit to reexamination shall result in suspension of annuity.
(b) A disability annuitant may request medical reevaluation under the
provisions of this section at any time.
OPM may reevaluate the medical condition of disability annuitants age 60 or
over only on their own request.
(c) Recovery based on medical or other
documentation. When OPM determines
on the basis of medical documentation
or other evidence that a disability annuitant has recovered from the disability, OPM will terminate the annuity effective on the first day of the
month beginning 1 year after the date
of the medical documentation or other
evidence showing recovery. If an agency reemploys a disability annuitant
who has been found recovered at any
grade or rate of pay within the 1-year
period pending termination of the disability annuity under this paragraph,
OPM will terminate the annuity effective on the date of reemployment.
(d) Recovery based on reemployment by
the Federal Government. Reemployment
by an agency at any time before age 60
is evidence of recovery if the reemployment is under an appointment not limited to a year or less, at the same or

higher grade or pay level as the position from which the disability annuitant retired. The new position must be
full-time unless the position the disability annuitant occupied immediately before retirement was less than
full-time, in which case the new position must have a work schedule of no
less time than that of the position
from which the disability annuitant retired. In this instance, OPM needs no
medical documentation to find the annuitant recovered. Disability annuity
payments will terminate effective on
the first day of the month following
the month in which the recovery finding is made under this paragraph.
§ 844.402 Restoration of earning capacity.
(a) Earning capacity determinations. If
a disability annuitant is under age 60
on December 31 of any calendar year
and his or her income from wages or
self-employment or both during that
calendar year equals at least 80 percent
of the current rate of basic pay of the
position occupied immediately before
retirement, the annuitant’s earning capacity is considered to be restored. The
disability annuity will terminate on
the June 30 after the end of the calendar year in which earning capacity is
restored.
(b) Current rate of basic pay for the position occupied immediately before retirement. (1) A disability annuitant’s income for a calendar year is compared
to the gross annual rate of basic pay in
effect on December 31 of that year for
the position occupied immediately before retirement. The income limitation
for most disability annuitants is based
on the rate for the grade and step that
reflects the total amount of basic pay
(both the grade and step and any additional basic pay) in effect on the date
of separation from the agency for disability retirement. Additional basic
pay is included subject to the premium
pay restrictions of 5 U.S.C. 5545 (c)(1)
and (c)(2).
(2) In the case of an annuitant whose
basic pay rate on the date determined
under paragraph (b)(1) of this section
did not match a specific grade and step
in the pay schedule:
(i) For those retiring from a Senior
Executive Service position, a merit pay

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Office of Personnel Management

§ 844.403

position, a position for which a special
pay rate is authorized (except as provided in paragraph (b)(2)(ii) of this section), or any other position in which
the rate of basic pay is not equal to a
grade and step in a pay schedule, the
grade and step will be established for
this purpose at the lowest step in the
pay schedule grade that is equal to or
greater than the actual rate of basic
pay payable.
(ii) For those retiring with a retained
rate of basic pay or from a position for
which a special pay rate is in effect but
whose rate of basic pay exceeds the
highest rate payable in the pay schedule grade applicable to the position
held, the grade is established for this
purpose at the highest grade in the
schedule that is closest to the grade of
the position held and within which the
amount of the retained pay falls. The
step is established for this purpose at
the lowest step in that grade that
equals or exceeds the actual rate of pay
payable.
(3) For annuitants retiring from the
United States Postal Service, only
cost-of-living allowances subject to
FERS deductions are included in determining the current rate of basic pay of
the position held at retirement.
(c) Income. (1) Earning capacity for
the purposes of this section is demonstrated by an annuitant’s ability to
earn post-retirement income in exchange for personal services or a work
product, or as a profit from one or
more businesses wholly or partly
owned by the disability annuitant and
in the management of which the annuitant has an active role. Income for the
purposes of this section is not necessarily the same as income for the
purposes of the Internal Revenue Code.
(2) Income earned from one source is
not offset by losses from another
source. Income earned as wages is not
reduced by a net loss from self-employment. The net income from each selfemployment endeavor is calculated
separately, and the income earned as
net earnings from one self-employment
endeavor is not reduced by a net loss
from another self-employment endeavor. Thus, a net loss from one endeavor
is considered to be a net income of
zero, and the net incomes from each
separate self-employment endeavor are

added together to determine the total
amount of income from self-employment for a calendar year.
(3) Income is counted in the calendar
year in which it is earned, even though
receipt may be deferred.
(d) Requirement to report income. All
disability annuitants who, on December 31 of any calendar year, are under
age 60 must report to OPM their income from wages or self-employment
or both for that calendar year. Each
year as early as possible, OPM will
send a form to annuitants to use in reporting their income from the previous
calendar year. The form specifies the
date by which OPM must receive the
report. OPM will determine entitlement to continued annuity on the basis
of the report. If an annuitant fails to
submit the report, OPM may stop annuity payments until it receives the report.
§ 844.403 Annuity rights after a disability annuity terminates.
(a) When a disability annuity is terminated because of recovery or restoration of earning capacity and the individual is not employed in the Government, the individual is entitled to an
annuity:
(1) Under 5 U.S.C. 8414(b) if the individual:
(i) Is at least age 50 when the disability annuity ceases and had 20 or
more years of service at the time of retiring for disability; or
(ii) Has 25 or more years of service at
the time of retiring for disability, regardless of age; or
(2) Under 5 U.S.C. 8412(g) if the individual is at least the minimum retirement age applicable under 5 U.S.C.
8412(h) when the disability annuity
ceases and had 10 or more years of service at the time of retiring for disability.
(b) When a disability annuitant
whose annuity was terminated because
of Federal reemployment is separated
and meets the age and service requirements for immediate retirement under
5 U.S.C. 8412 or 8414, the individual is
entitled to an annuity computed under
5 U.S.C. 8415.
[55 FR 6598, Feb. 26, 1990. Redesignated at 58
FR 48273, Sept. 15, 1993]

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§ 844.404

5 CFR Ch. I (1–1–09 Edition)

§ 844.404 Reinstatement of disability
annuity.
(a) When a disability annuity stops,
the individual must again prove that
he or she meets the eligibility requirements in order to have the annuity reinstated.
(b) Reinstatement of annuity terminated
based on recovery. (1) When a recovered
disability annuitant under age 62
whose annuity was terminated because
he or she was found recovered on the
basis of medical evidence (§ 844.401) is
not reemployed in a position subject to
FERS, and, based on the results of a
current medical examination, OPM
finds that the disability has recurred,
OPM will reinstate the disability annuity as provided in paragraph (d) of this
section. The right to the reinstated annuity begins on the date of the medical
documentation showing that the disability has recurred, or if the medical
documentation clearly shows that the
disability recurred on an earlier date,
the annuity will be reinstated on that
earlier date.
(2) Except in the case of an individual
receiving an annuity under § 844.404(b),
OPM will, as provided in paragraph (d)
of this section, reinstate the disability
annuity of a former annuitant whose
annuity was terminated because he or
she was found recovered on the basis of
Federal reemployment when:
(i) The results of a current medical
examination show that the individual’s
medical condition has worsened since
the finding of recovery and that the
original disability on which retirement
was based has recurred; and
(ii) As a result, he or she has been:
(A) Separated and not reemployed in
a position subject to FERS; or
(B) Placed in a position that results
in a reduction in grade or pay below
that from which the individual retired,
or in a change to a temporary or intermittent appointment. The right to the
reinstated annuity begins on the date
the reemployment ends or the effective
date of the placement in the position
that results in a reduction in grade or
pay or change in appointment.
(c) Reinstatement of annuity terminated
because earning capacity was restored. (1)
OPM will reinstate the disability annuity as provided in paragraph (d) of this
section when a disability annuitant

whose annuity was terminated under
§ 844.402(a):
(i) Is not reemployed in a position
subject to FERS;
(ii) Has not recovered from the disability for which the individual retired
(except in the case of a military reserve technician whose annuity was
awarded under 5 U.S.C. 8456); and
(iii) Again loses earning capacity, as
determined by OPM.
(2) The reinstated annuity is payable
from January 1 of the year following
the calendar year in which earning capacity was lost. Earning capacity is
lost if, during any calendar year, the
individual’s income from wages or selfemployment or both is less than 80 percent of the current rate of basic pay of
the position held at retirement.
(d) Except as provided in §§ 844.303
and 844.304, a disability annuity reinstated under the preceding paragraphs
of this section is paid at the rate provided under § 844.302(b) until the end of
the 12th month beginning after the annuity is reinstated. Thereafter, the
rate determined under § 844.302(c) is
payable until age 62.
(e) Notwithstanding the preceding
paragraphs, an annuity may not be reinstated under this section if the individual is receiving an annuity under
part 842 of this chapter.
[55 FR 6598, Feb. 26, 1990. Redesignated and
amended at 58 FR 48273, Sept. 15, 1993]

PART 845—FEDERAL EMPLOYEES
RETIREMENT SYSTEM—DEBT COLLECTION
Subpart A—General Provisions
Sec.
845.101 Purpose.
845.102 Definitions.
845.103 Prohibition against collection of
debts.
845.104 Status of debts.
845.105 Termination and suspension of collection actions.

Subpart B—Collection of Overpayment
Debts
845.201 Purpose.
845.202 Scope.
845.203 Definitions.
845.204 Processing.
845.205 Collection of debts.
845.206 Collection by administrative offset.

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