Veterans Preference in Federal Jobs

Veterans preference in its present form comes from the Veterans’ Preference Act of 1944, as amended. By law, veterans who are disabled or who served on active duty in the Armed Forces during certain specified time periods or in military campaigns are entitled to preference over others in hiring from competitive lists of eligibles and also in retention during reductions in force.

Preference applies in hiring for virtually all jobs, whether in the competitive or excepted service. In addition to receiving preference in competitive appointments, veterans may be considered for special noncompetitive appointments for which only they are eligible.

In addition to preference during hiring, veteran status also provides advantages for retention during reductions-in-force. Other important veterans’ protections apply when Reserve or Guard members serve on active duty. The special provisions for veterans in some cases also carry specialized appeal and redress procedures.

Note: While most federal jobs do not have maximum entry ages or mandatory retirement, some do, particularly in the firefighting and law enforcement fields. In many cases the normal maximum entry age is 37 so that the employee can put in a 20-year career before mandatory retirement, which in most cases in such positions is 57. However, veterans with preference who are above the maximum age may apply for a waiver, which an agency must grant unless it certifies that the age limit is essential to the position.

Veterans Preference in Hiring

Preference in hiring applies to permanent and temporary positions in the competitive and excepted services of the executive branch, excluding the Senior Executive Service. Preference applies in hiring from civil service examinations conducted by the Office of Personnel Management (OPM) and agencies under delegated examining authority, for most excepted service jobs including Veterans’ Recruitment Appointments (VRA) — formerly called Veterans’ Readjustment Appointments — and when agencies make temporary, term, and overseas limited appointments. Veterans’ preference does not apply to promotion, reassignment, change to lower grade, transfer or reinstatement.

Veterans’ preference does not guarantee a job nor does it require an agency to use any particular appointment process.

Who is Entitled

Five-point preference is given to those honorably separated veterans (this means an honorable or general discharge) who are discharged or released from active duty service (not active duty for training) in the Armed Forces:

  • during any war (this means a war declared by Congress, the last of which was World War II);
  • during the period April 28, 1952, through July 1, 1955;
  • for more than 180 consecutive days, any part of which occurred after January 31, 1955, and before October 15, 1976;
  • during the Gulf War period beginning August 2, 1990, and ending January 2, 1992;
  • in a campaign or expedition for which a campaign medal has been authorized; or
  • individuals who served on active duty for more than 180 consecutive days, other than for training, any part of which occurred during the period beginning September 11, 2001, and ending on the date prescribed by presidential proclamation or by law as the last day of Operation Iraqi Freedom.

Medal holders and Gulf War veterans who originally enlisted after September 7, 1980, or entered on active duty on or after October 14, 1982, without having previously completed 24 months of continuous active duty, must have served continuously for 24 months or the full period called or ordered to active duty. See below for special rules regarding service in Bosnia.

Individuals who are released or discharged from active duty in the armed forces may receive veterans’ preference provided these individuals meet other applicable veterans’ preference eligibility requirements. This requires agencies to give the same effect to a ‘‘release or discharge from active duty’’ as they would to a ‘‘separation from the armed forces.’’

Military retirees at or above the rank of major or equivalent are not entitled to preference unless they qualify as disabled veterans.

Ten-point preference is given to:

  • honorably separated veterans who: qualify as disabled veterans because they have served on active duty – including service entirely for training purposes — in the Armed Forces at any time and have a present service-connected disability or are receiving compensation, disability retirement benefits, or pension from the military or the Department of Veterans Affairs; or are Purple Heart recipients;
  • the spouse of a veteran unable to work because of a service-connected disability;
  • the unmarried widow of certain deceased veterans; and
  • the parent of a veteran who died in service or who is permanently and totally disabled, within certain additional restrictions.

How Preference Applies

In category rating, preference eligibles who meet the minimum qualification requirements and who do not have a service-connected disability of 10 percent or more are assigned to a quality category based upon job-related assessment. They are given preference in selection by being listed ahead of non-preference eligibles within their category. Those with a compensable service-connected disability of at least 10 percent must be listed in the highest quality category. If a veteran is in the category of those to be considered, an agency generally must choose the veteran over any non-veteran unless there are grounds for a passover relating directly to the veteran’s fitness for employment.

This system generally has replaced the traditional Rule of 3 system requiring the agency to select from the top three candidates and restricting passing over a preference eligible in favor of a lower ranking non-preference eligible person. In Rule of 3, veterans who are eligible for preference and who meet the minimum qualification requirements of the position, have five or 10 points added to their passing score on a civil service examination. For scientific and professional positions in grade GS-9 or higher, names of all eligibles are listed in order of ratings, augmented by veterans’ preference points, if any. For all other positions, the names of 10-point preference eligibles who have a service-connected disability of 10 percent or more are placed ahead of the names of all other eligibles. Other eligibles are then listed in order of their earned ratings, augmented by veterans’ preference points. A preference eligible is listed ahead of a nonpreference eligible with the same score.

Special Appointing Authorities

The following special authorities permit the noncompetitive appointment of eligible veterans. Use of these special authorities is entirely discretionary with the agency; no one is entitled to one of these special appointments.

Veterans’ Recruitment Appointments

The VRA is a special authority by which agencies can appoint an eligible veteran without competition to a position that is otherwise in the competitive service. A covered veteran, as defined in 38 U.S.C. 4212(a)(3), includes:

  • disabled veterans;
  • veterans who served on active duty in the Armed Forces during a war or in a campaign or expedition for which a campaign badge has been authorized;
  • veterans who, while serving on active duty with the Armed Forces, participated in a United States military operation for which an Armed Forces Service Medal was awarded pursuant to Executive Order 12985 (61 FR 1209); and
  • recently separated veterans.

After two years of substantial continuous service in a permanent position under a VRA, the appointment will be converted to a career or career conditional appointment in the competitive service, providing performance has been satisfactory.

Disabled Veterans’ Training Programs

Disabled veterans eligible for training under the Department of Veterans Affairs’ (VA) vocational rehabilitation program may enroll for training or work experience at an agency under the terms of an agreement between the agency and VA. The veteran is not a federal employee for most purposes while enrolled in the program, but is a beneficiary of the VA.

The training is tailored to individual needs and goals so there is no set length. If the training is intended to prepare the individual for eventual appointment in the agency (rather than just work experience), OPM must approve the training plan. Upon successful completion, the veteran will be given a certificate of training showing the occupational series and grade level of the position for which trained. This allows any agency to appoint the veteran noncompetitively for a period of one year. Upon appointment, the veteran is given a special tenure appointment which is then converted to career-conditional with OPM approval.

Disabled Veterans’ Temporary Appointments

An agency may give a noncompetitive temporary appointment of more than 60 days or a term appointment to any veteran:

  • retired from active military service with a disability rating of 30 percent or more; or
  • rated by the Department of Veterans Affairs within the preceding year as having a compensable service- connected disability of 30 percent or more.

There is no grade level limitation for this authority, but the appointee must meet all qualification requirements, including any written test requirement. Initially, the disabled veteran is given a temporary appointment with an expiration date in excess of 60 days. After demonstrating satisfactory performance, the veteran may be converted at any time to a career-conditional appointment.

Veterans should contact the federal agency personnel office where they are interested in working to find out about opportunities. Veterans must submit a copy of a letter dated within the last 12 months from the Department of Veterans Affairs or the Department of Defense certifying receipt of compensation for a service-connected disability of 30 percent or more.

Excepted Appointments under Schedule B

Authorized by the Veterans Employment Opportunities Act of 1998, this authority permits an agency to appoint an eligible veteran who has applied under an agency merit promotion announcement that is open to candidates outside the agency.

To be eligible for a Schedule B appointment, a candidate must be a preference eligible or veteran separated after three or more years of continuous active service performed under honorable conditions.

Veterans given a Schedule B appointment are in the excepted service. The appointment does not lead to competitive status. However, these appointees may be promoted, demoted, or reassigned at their agency’s discretion, and may apply for jobs (whether in their own or other agencies) under the same terms and conditions that applied to their original appointment—that is, they may apply only when the agency has issued a merit promotion announcement open to candidates outside the agency.

Veterans interested in applying under this authority should seek out agency merit promotion announcements open to candidates outside the agency. Applications should be submitted directly to the agency.

Affirmative Action for Certain Veterans under Title 38

Section 4214 of Title 38, United States Code calls upon agencies to establish a separate affirmative action program for disabled veterans as part of agency efforts to hire, place, and advance persons with disabilities under the Rehabilitation Act of 1973. Agencies are also urged to “promote the maximum of employment and job advancement opportunities” for those veterans eligible for noncompetitive appointment under the above special authorities. This section requires agencies to:

  • provide placement consideration under special noncompetitive hiring authorities for VRA and 30 percent or more disabled veterans;
  • ensure that all veterans are considered for employment and advancement under merit system rules; and
  • establish an affirmative action plan for the hiring, placement, and advancement of disabled veterans.

Reductions in Force

Veterans have advantages over nonveterans in a reduction-in-force (RIF), the government’s term for the process it goes through when cutting jobs. Also, special provisions apply in determining whether retired military members receive preference in RIF and whether their military service is counted.

In a RIF, federal employees are ranked on retention registers for competitive levels (groups of similar jobs) based on four factors: tenure, veterans’ preference, length of service, and performance. First they are placed in Tenure Group I, II, or III, depending on their type of appointment. Within each group, they are placed in a subgroup based on their veteran status:

  • Subgroup AD includes each preference eligible who has a compensable service-connected disability of 30 percent or more;
  • Subgroup A includes all other preference eligibles not in Subgroup AD, including employees with derived preference;
  • Subgroup B includes all employees not eligible for veterans’ preference.

Within each subgroup, employees are ranked in descending order by the length of their creditable federal civilian and military service, augmented by additional service according to the level of their performance ratings. When a position in a competitive level is abolished, the employee affected (released from the competitive level) is the one who stands the lowest on the retention register. Because veterans are listed ahead of nonveterans within each tenure group, they are the last to be affected by a RIF action.

Restoration After Uniformed Service

Any federal employee, permanent or temporary, in an executive agency other than an intelligence agency, but including the U.S. Postal Service, Postal Rate Commission, and nonappropriated fund activity, who performs duty with a uniformed service (including active duty, active duty for training, or inactive duty training), whether voluntary or involuntary, is entitled to be restored to the position he or she would have attained had the employee not entered the uniformed service, provided the employee:

  • gave the agency advance notice of departure except where prevented by military circumstances;
  • was released from uniformed service under honorable conditions;
  • served no more than a cumulative total of five years (exceptions are allowed for training and involuntary active duty extensions, and to complete an initial service obligation of more than five years); and
  • applies for restoration within the appropriate time limits.

Employees in the intelligence agencies have substantially the same rights, but are covered under agency regulations rather than the Office of Personnel Management’s and have different appeal rights.

While on duty with the uniformed services, the agency carries the employee on leave without pay unless the employee requests separation. A separation under these circumstances does not affect restoration rights.

Uniformed service means the Armed Forces; the Army and Air National Guard when engaged in active duty for training, inactive duty training, or full-time National Guard duty; the commissioned corps of the Public Health Service; and any other category of persons designated by the President in time of war or emergency.

Agencies must tell employees who enter the service about their entitlements, obligations, benefits, and appeal rights.

Agencies may not question the timing, frequency, duration, and nature of Reserve uniformed service, but employees are obligated to try to minimize the agency’s burden. For example, Department of Defense (DoD) directives provide that it is DoD policy for Reserve component members to give their employer as much advance written notice as practicable of any pending military duty.

Time Limits

Employees who served in the uniformed services:

  • Less than 31 days (or who leave to take a fitness exam for service) must report back to work at the beginning of the next regularly scheduled work day following their completion of service and the expiration of 8 hours after a time for safe transportation back to the employee’s residence.
  • More than 30 but less than 181 days must apply for reemployment no later than 14 days after completion of service.
  • More than 180 days have 90 days after completion of service to apply for restoration.

Employees who fail to meet these time limits are subject to disciplinary action.

Agencies must reemploy as soon as practicable, but no later than 30 days after receiving the application. Agencies have the right to ask for documentation showing the length and character of the employee’s service and the timeliness of the application.

Employees who served less than 91 days must be placed in the position for which qualified that they would have attained had their employment not been interrupted. If not qualified for such position after reasonable efforts by the agency to qualify the person, the employee is entitled to be placed in the position he or she left.

Employees who served more than 90 days have essentially the same rights as described above except that the agency has the option of placing the employee in a position for which qualified of like seniority, status, and pay.

Employees with service-connected disabilities who are not qualified for the above must be reemployed in a position that most closely approximates the position they would have been entitled to, consistent with the circumstances in each case.

Employees who were under time-limited appointments finish the unexpired portion of their appointments upon their return.

If the employing agency is unable to reemploy an individual returning from duty with a uniformed service, OPM will order placement in another agency when:

  • OPM determines that it is impossible or unreasonable for an agency in the executive branch (other than an intelligence agency) to reemploy the person;
  • an intelligence agency or an agency in the legislative or judicial branch notifies OPM that it is impossible or unreasonable to reemploy the person, and the person applies to OPM for placement assistance; or
  • a noncareer National Guard technician who is not eligible for continued membership in the Guard for reasons beyond his or her control applies to OPM for placement assistance.

Upon restoration, employees are generally treated as though they had never left. This means that time spent in the uniformed services counts for seniority, within-grade increases, completion of probation, career tenure, retirement, and leave rate accrual. (Employees do not earn sick or annual leave while off the rolls or in a nonpay status.)

Benefits on Performance of Active Duty

Pay

Under 5 U.S.C. 5538, agencies must make up the difference between regular pay for their employees and the often lower military pay they receive when on active duty as activated Reservists or National Guard members (active duty with the Coast Guard Ready Reserve qualifies). Eligible civilian employees receive for each covered biweekly pay period a supplemental payment equal to the amount by which civilian basic pay exceeds (if at all) military pay and allowances allocable to the given period.

Civilian basic pay for this purpose is the basic pay (including locality pay and any special rate pay) the employee would have received for his or her civilian employment if that employment had not been interrupted. The employing agency must adjust an employee’s projected rate of basic pay as it would have been adjusted (with reasonable certainty) but for the interruption of military active duty. This would include general increases, locality pay increases, and within-grade increases based on longevity and acceptable performance. It could also include certain career-ladder promotion increases and performance-based basic pay increases, if such increases would have been reasonably certain.

Military pay and allowances are payments payable to the employee for active duty service for the given pay period. The employee-reservist must provide his or her employing agency with a copy of his monthly military leave and earnings statement for each affected month. A daily rate will be computed by dividing the monthly total by 30 days for full months or by the actual number of days for partial months.

The reservist differential is not basic pay for any purpose. The reservist differential is considered to be pay for the purposes of various other laws governing federal employee compensation (such as laws governing salary offset for debt collection, waiver of overpayments, garnishment, back pay). However, the reservist differential will not be counted as part of aggregate compensation in applying the aggregate pay limit in 5 U.S.C. 5307.

Reservist differentials are taxable income for federal income tax and withholding purposes. They are subject to Social Security and Medicare taxes if paid for periods of active duty of 30 days or less but not subject to those taxes if paid longer.

Leave provisions such as military leave, annual or sick leave, compensatory time off, or other forms of paid leave remain available for use. However, the differential does not apply during any period for which the employee receives any kind of paid leave or other paid time off; the payment will be reduced to take into account any paid work or paid time off.

Leave

Each fiscal year, employees under permanent appointment are entitled to 15 calendar days of military leave, with pay, to perform active duty as a member of a Reserve component. Part-time employees are entitled to military leave pro-rated according to the tour of duty, for example, an employee who works 20 hours a week earns seven days of military leave.

Employees may carry over 15 days of unused military leave into a new fiscal year. Therefore, potentially they may have a total of 30 days to use in any one fiscal year. This means that Reservists whose military duty spans two fiscal years may use up to 45 days of military leave at one time. Non-workdays count against the 15 days of military leave allowed during the year except when the non-workdays occur at the beginning or end of the military leave period.

Reservists may not use annual leave or leave without pay interchangeably with military leave, on a selective basis, to avoid being charged military leave during weekends and holidays. Also, except for U.S. Postal Service employees, Reservists may not use military leave to cover drill periods since monthly drills are considered inactive duty training and paid military leave is intended only for periods of active duty. They may, however, use annual leave or leave without pay.

Generally an employee must be in a pay status either immediately before or after taking military leave. The test for determining entitlement to military leave is whether, but for the active duty, the employee would have been in a civilian pay status.

Upon request, an employee performing duty with the uniformed services is entitled to use either accrued annual leave or military leave for such service. However, military leave cannot be used for inactive duty, for example, drills.

Under Section 1113 of Public Law 108-136, federal employees who are members of the Guard or Reserve and who are ordered to active military duty for certain contingency operations are authorized 22 days of additional military leave on a calendar year basis. There is no carry over from one calendar year to the next.

Excused absence for returning employees—Agencies must grant five work days of excused absence, without charge to leave, to these employees upon notification to their employing agencies of their intent to return to federal civilian employment. This request covers all employees who were activated for military service in military operations established under Executive Order 13223, and who spent at least 42 consecutive days on active duty. Agencies may grant this period of excused absence prior to the employee’s resumption of work, or at a time mutually agreeable to the agency and the employee, if the employee has already returned to work. The leave applies to each deployment, for those deployed more than once, although only once in any 12-month period beginning after use of the excused absence.

Leave options

An employee may use annual, sick or military leave or compensatory time off while performing active uniformed duty.

Insurance

The Federal Employees’ Group Life Insurance coverage of an employee who takes leave without pay to enter the uniformed services continues for up to 24 months. There is no cost to the employee for the first 12 months of coverage, but employees who continue coverage for the second 12 months must pay both the employee and employer share of the premiums. If the employee separates, life insurance continues for up to 12 months, or 90 days after uniformed service ends, whichever is sooner.

Rules at 5 CFR 890 provide up to 24 months of continued Federal Employees Health Benefits program coverage for federal employees who are called or ordered to active duty in support of a contingency operation (5 U.S.C. 8905a), and authorized agencies to pay the employee’s share and the government’s share of premiums for up to 24 months (5 U.S.C. 8906(e)(3)). The act provides that this benefit is available for any employee who:

  • is enrolled in the FEHB program;
  • is a member of a reserve component of the armed forces;
  • is called or ordered to active duty in support of a contingency operation (as defined in Section 101(a)(13) of title 10 U.S.C.);
  • is placed on leave without pay or separated from service to perform active duty; and
  • serves on active duty for more than 30 consecutive days.

PL 108-37 provides up to 180 days of “transitional” Tricare (military health care) benefits for members of the military who are discharged from active duty. As a result, returning members may postpone reinstating their FEHB enrollment until their transitional Tricare coverage expires, or until any point up to that date. Employees who return from military service should take care to avoid any breaks in health insurance coverage between the end of their transitional Tricare coverage and the reinstatement of their FEHB.

Enrollment in the Federal Dental and Vision Insurance Program can be canceled when either the employee or the employee’s spouse is called to active military duty.

Employees called to active military duty can keep their Federal Long Term Care Insurance Program coverage as long as they continue to pay the premiums. There is no provision in law allowing the agency to take over payment, as there is with health insurance, nor can the employee incur a debt for the premiums during the time in a nonpay status. Employees can arrange to have premiums deducted from military pay or from a bank account. Those who have payroll deduction of premiums should contact Long Term Care Partners at (800) 582-3337.

Thrift Savings Plan

When civilian employees enter military active duty, they cannot make any contributions to their civilian TSP accounts while on leave without pay or separated from the civilian position. Nor will the employing agency contribute matching funds available for employees under the Federal Employees Retirement System.

If you have a TSP loan, the Service Office must be notified of your LWOP status in order to prevent a possible taxable distribution of the unpaid loan balance.

As an active duty service member, you can contribute to a separate military TSP account. These accounts must be opened through the military services. If you have both a civilian federal employee TSP account and a uniformed services TSP account, they will be treated separately for most purposes. This means, for example, that if you want to move your money among investment funds, you must submit two interfund transfer requests, one for each account. However, the accounts will be combined for the Internal Revenue Code’s elective deferral limit on contributions (in 2014 this was $17,500) and in determining the amount you are eligible to borrow from the TSP.

If you are later restored to your civilian position, you may make retroactive contributions to your civilian TSP account and elections to cover the period of military service. The amount of money you can retroactively contribute to your civilian account will be offset by any contributions you made to a uniformed services TSP account while on active duty.

FERS-covered employees are entitled to receive agency automatic (1 percent of salary) contributions plus matching funds based on contributions made from basic pay while in the uniformed services, if you are restored to the civilian position.

If employees separate and their accounts are disbursed as automatic cashouts, the employees may return to the TSP an amount equal to the full amount of the payment after they are reemployed.

Members of the uniformed services have access to the TSP loan program. However, reservists who drill only monthly should think seriously before taking a loan from their military accounts because they may be unable to repay the loan in the time frame required by law. Employees are prohibited from repaying a uniformed services TSP loan from civilian pay, or vice versa.

Once the employee separates from either the uniformed services, or the federal civilian service, the employee generally will be able to combine the TSP accounts. However, tax-exempt combat zone pay in a military account cannot be transferred into a civilian account.

Flexible Spending Accounts

Federal employees who have health care flexible spending accounts and who are called to active military duty for at least 180 days are eligible for a refund of unspent money in that account. A “qualified reservist distribution” can be made, but the distribution will be taxable income and the distribution will close the account and no additional claims can be made against the account. No new account can be opened until the next annual open season. Eligible persons can make the request starting with the date of call to active duty.

Redress and Appeal Rights

The redress and appeal rights available to veterans who go to work for the federal government depend upon the nature of the action being appealed. Also see the publication Veterans’ Employment Redress Laws in the Federal Civil Service at www.mspb.gov under MSPB Studies.

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