Office of Personnel Management 

Retirement and Insurance Group 

1920 

Benefits Administration Letter 

1954 1959 

Number: 95-101 Date: January 27, 1995 

1986 

SUBJECT Public Law 103-353, the "Uniformed Services Employment and 

Reemployment Rights Act of 1994" 

Public Law 103-353, the "Uniformed Services Employment and Reemployment Rights Act of 1994" 

(USERRA), approved October 13, 1994, made two substantial amendments to the FERS and CSRS 

provisions under title 5. In addition, it made amendments to title 38 (Veterans' Benefits), which are 

expressly applicable to Federal retirement systems. 

Under title 5, the first change makes certain National Guard service creditable for the first time. The 

other relates to the service credit deposits required for certain military service which interrupts civilian 

Federal service. Both of these provisions have applicability for certain service performed in the past. 

USERRA requires that OPM's regulations provide at least as liberal benefits for Federal employees 

as the regulations which will be prepared by the Department of Labor and which will be applicable 

to the private sector. Nevertheless, since Labor now estimates that it will be at least a year before 

its regulations are issued, it is necessary for OPM to proceed before Labor's regulations are issued. 

In addition, other parts of OPM are currently working on the substantive and procedural aspects of 

the law, and their work will affect retirement procedures, particularly in the area of documentation. 

We thus cannot yet complete our analysis of the effects of the law. However, as soon as possible, 

we will be preparing regulations, as well as updates to chapters 22 and 23 of the CSRS and FERS 

Handbook. Nevertheless, at this time, it is important to advise agencies of those aspects of the law 

which are reasonably clear. We will advise you of specific procedures as they are prepared. 
P.L. 103-353, USERRA -2­

Attached to this Benefits Administration Letter is a copy of a December 7, 1994, Interagency 

Advisory Group memorandum to agency directors of personnel. This memorandum discusses 

USERRA and its obligations more generally. 

Attachment 
P.L. 103-353, USERRA -3­

National Guard Service 

Under 5 U.S.C. §§ 8331(13) and 8401(31), the definition of "military service" previously did not 

include service in the National Guard except when ordered to active duty in the service of the United 

States. USERRA now adds: 

full-time National Guard duty (as such term is defined in section 101(d) of title 10) if such 

service interrupts creditable civilian service under this subchapter and is followed by 

reemployment in accordance with chapter 43 of title 38 that occurs on or after August 1, 

1990 

to both of these definitions. Since non-covered service is creditable only under CSRS, such National 

Guard service which interrupts non-FERS covered service is creditable under FERS only if it is part 

of a CSRS component of a FERS annuity. Since there must be reemployment in the civilian service 

on or after August 1, 1990 (the day before Iraq invaded Kuwait), the number of such cases will be 

very low. 

Section 101(d)(5) of 10 U.S.C. provides: 

The term "full-time National Guard duty" means training or other duty, other than inactive 

duty, performed by a member of the Army National Guard of the United States or the Air 

National Guard of the United States in the member's status as a member of the National 

Guard of a State or territory, the Commonwealth of Puerto Rico, or the District of Columbia 

under section 316, 502, 503, 504, or 505 of title 32 for which the member is entitled to pay 

from the United States or for which the member has waived pay from the United States. 

We have been informally advised by the National Guard Bureau that the cited title 32 sections cover 

all active duty National Guard service. 

Putting the requirements of these two sections together, the rules for crediting National Guard service 

(other than when ordered to active duty in the service of the United States) are that the service 

MUST meet ALL of the following conditions: 

N It must interrupt civilian service creditable under CSRS or FERS, as appropriate. 

N It must be followed by reemployment in accordance with chapter 43 of title 38 that occurs 

on or after August 1, 1990. 

N It must be full-time (and not inactive duty). 
P.L. 103-353, USERRA -4­

N It must be performed by a member of the Army National Guard of the United States or the 

Air National Guard of the United States in the member's status as a member of the National 

Guard of a State or territory, the Commonwealth of Puerto Rico, or the District of 

Columbia. 

N It must be under one of the enumerated sections. 

N The individual must be entitled to pay from the U.S. (or have waived pay from the U.S.) for 

the service. 

Service in the National Guard (except when ordered to active duty in the service of the United States) 

IS NOT CREDITABLE IF ANY OF THE REQUIREMENTS ARE NOT MET. For example, such 

service which precedes Federal employment is not creditable. Similarly, if such service meets all of 

the requirements except that it is not followed by reemployment in accordance with chapter 43 of title 

38 that occurs on or after August 1, 1990, it is not creditable, even if it is followed by reemployment 

by the Government (for example, this could occur if the individual has served longer than the 

statutory maximum for reemployment rights). 

As is the case for military deposits in general, the deposits required for such service must be collected 

by the employing agency. Thus, the agency must insure that all of the requirements are met. The 

agency must use personnel records to ensure that the separation and reemployment meet the statutory 

requirements. While there will need to be changes in Subchapter 22C of the CSRS and FERS 

Handbook, the basic procedures are already in place there for obtaining certification from the 

appropriate National Guard offices as to whether the remaining requirements are met. 

There is an additional factor which will need to be considered in some of these cases. When Federal 

employees have entered into National Guard state service, they have sometimes been placed on 

leave-without-pay (LWOP) status from their civilian positions. In LWOP cases, since the National 

Guard service itself has been neither military service nor Federal civilian employment, the individuals 

have been entitled to civilian service credit for the period of LWOP, subject to the "six-month" rule, 

with no service credit deposit required. 

If that National Guard service is now military service under the amendments to 5 U.S.C. §§ 8331(13) 

or 8401(31), a different rule will apply. Service credit will be available for the period of National 

Guard service during LWOP if and only if the military service credit deposit is paid. As with other 

periods of military furlough, the "six-month" rule will not apply, and there can be no civilian service 

credit for the period. 
P.L. 103-353, USERRA -5­

In other cases where Federal employees have been separated from their civilian positions to enter 

National Guard state service, no service credit is provided for the period of separation. Unless that 

National Guard service is now military service under the amendments to 5 U.S.C. §§ 8331(13) or 

8401(31), such periods remain non-creditable. 

Military Service Credit Deposits 

Prior to USERRA, service credit deposits were based on a set percentage (7% under CSRS and 3% 

under FERS) of the amount of military basic pay, plus interest under specified conditions. The rules 

for charging interest have not changed. However, under USERRA, the pre-interest base for certain 

of these deposits is now subject to a limit, found at 5 U.S.C. §§ 8334(j)(1)(B) and 8422(e)(1)(B), 

which both provide: 

In any case where military service interrupts creditable civilian service under this subchapter 

and reemployment pursuant to chapter 43 of title 38 occurs on or after August 1, 1990, the 

deposit payable under this paragraph may not exceed the amount that would have been 

deducted and withheld under subsection (a)(1) from basic pay during civilian service if the 

employee had not performed the period of military service. 

Thus, under both CSRS and FERS, in computing the military deposit for service which meets the 

described criteria, the agency must make two calculations: (1) 3% or 7% of the military basic pay, 

and (2) an alternative calculation of what the CSRS or FERS employee contributions would have 

been for the civilian service had the individual not entered into the military. 

USERRA provides guidance as to how the civilian base pay should be computed. If it is possible to 

determine what the employee's base pay would have been for the period of absence (including locality 

pay, premium pay which constitutes basic pay, promotions, annual increases, step increases and other 

base pay increases to which the individual would have been entitled) then those rates should be used. 

However, if, as in the case of intermittent employees, it is not reasonably possible to determine what 

the individual's base pay would have been for the period of absence, then the rate of pay to be used 

is the average rate of base pay during the 12-month period immediately preceding the absence (or, 

if shorter, the period of employment immediately preceding the absence). 

In all other cases, that is, where military service did not interrupt creditable civilian service, or where 

there was not reemployment pursuant to chapter 43 of title 38 which occurred on or after August 1, 

1990, then the prior deposit rules apply. It will be up to the employing agency to ascertain whether 

the criteria apply, and to make all calculations. 
P.L. 103-353, USERRA -6­

Effective Date 

USERRA does not provide any specific effective date for the changes to the title 5 provisions. 

However, there is a long-standing rule that, absent explicit statutory provisions to the contrary, 

individuals' benefits are based upon the law in effect on the date of their separation with title to 

annuity benefits, or the annuity commencing date, whichever is earlier. Accordingly, these changes 

apply only to individuals whose separation with title to annuity benefits from retirement covered 

service AND whose annuity commencing date is subsequent to the enactment of the law. 

N Individuals separated from October 4 through 12, with a November 1 annuity commencing 

date are not covered by USERRA. 

N In some cases (such as some disability retirements), individuals may have a choice of annuity 

commencing dates if they are separated on or after October 13, 1994, but with a last day of 

pay prior to that date. An individual in such circumstances will be entitled to the benefits of 

USERRA only if he or she elects the later annuity commencing date. 

N Individuals not covered by USERRA are not entitled to the benefit of the changes in the law 

unless they are again employed and gain a new annuity title based upon a subsequent 

separation. 

N A reemployed annuitant can become covered only if he or she works a sufficient period and 

meets the deposit requirement for a redetermined annuity. 

Summary 

An individual covered by USERRA will be entitled to make a deposit and receive service credit for 

previously non-creditable National Guard service. An individual covered by USERRA who made a 

service credit deposit is entitled to a refund of the difference between what his or her service credit 

deposit would have been under the old and new laws, regardless of when the deposit was made. 

Covered individuals are entitled to these benefits even if they are separated or retired at this time. 

An individual in a category listed as not covered by USERRA is not entitled to either of these benefit 

improvements. The following summarizes who is and is not covered by USERRA: 

N Date of separation: On or before October 12, 1994 

Annuity commencing date: On or before October 12, 1994 

USERRA status: 

NOT COVERED
P.L. 103-353, USERRA -7­

N Date of separation: 

Annuity commencing date: 

USERRA status: 

NOT COVERED 

On or before October 12, 1994 

After October 12, 1994 

N Date of separation: 

Annuity commencing date: 

USERRA status: 

NOT COVERED 

After October 12, 1994 

On or before October 12, 1994 

N Date of separation: 

Annuity commencing date: 

USERRA status: 

COVERED 

After October 12, 1994 

After October 12, 1994 

As noted above, OPM will issue detailed instructions as soon as possible. These will include 

procedures for documenting a recomputed deposit on an Individual Retirement Record (SF2806 or 

SF3100), refunds of an overpaid deposit for which an agency has the records, and refunds of an 

overpaid deposit for which OPM has the records. 
P.L. 103-353, USERRA -8­

Attachment 

The Interagency Advisory Group memorandum to agency directors of personnel has 

been distributed as an attachment to Benefits Administration Letter 95-202, dated 

January 10, 1995.