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.ID:A335510 

f ···• ~ " ~uiilTT CLASSIFICATION (q,_r, _EOR OtflClkL uSE O~l'l _ 

DISPOSITION FORM For General Canine and 

General Ack.erme.n Onlz 

. . FILE llO. SUBJECT 

Mr. William. F. Fr1eC!man 

TD Director flOM PERS DATE :2-9 ·.run 55 COMMENT NO. I 

l. The inclosed memorandum summa.r1zee the current status ot :Mr. Friedman's 

leave,, "j}ay, and retirement accounts. 

2. It it is f'ina_'ll.y determined that Nr. Friedman v1ll retire, it is 

'bo retain his services for the Agency,on·.·a.ccmtraotual_.baisis. ~ .· the inclosure sets forth some of the details· of this .. ma.tter. · 

. 3. Such contracts appear to of'ter the Agency a means of re-..~u.s 

Mr. Friedman's extensive el!p6l'!ience a.nd kno.wledge and-at the same time. 

method of supplementing Mr. Friedman's retirement income. 

Incl: 

MAURICE H. KLEIN 

Assistant Chief 

·Personnel Division 

Memorandum for the 

Record, dated 

28 June 2955. 

FOR OFflCihl USE ON.l 'l: 

- 1 DD '.~~"'° 96 ~ . 

REl'UiCl!S MME FORM •· I OCI' a. WHICH MAY IE llllD I&--· llC8Dl-B U. f. - PRlllTlllO OPl'IDll I UU 0 • 1-1 

@'~mroved_ for Release by NSA on 05-15-2014 pursuant to E.O. 1352e ·-- __ _ 
For GeneraJ. Canine and 

General Acker.man Only 

28 June 1955 

MEMORANDUM FOR THE ROOOBD 

SUBJECT: Status of Mr. William. F. Friedman 

1. The i'ol.lowing :Ls a SUJl11'DE.U'Y of the sta.tus of the leave,, 

pay,, and retirement e.ccowits of Mr. William F. Friedma.u. 

Add.1tional information pertaining to the problem of retaining 

Mr. Friedman's services is also presented for consideration. 

2. Leave Account. 

a. As of 25 June 1955,, Mr. Friedman's leave accounts 

stand as follows: 

(l.) Sick Leave. - {See para 4) Deficit of 236 

hours. 

(2) Annual Leave. Credit of' 210 hours. 

(3} If' Mr. Friedman retires without returning to 

duty, the deficit in his sick leave account 

may be waived upon presentation of a mediaal 

certificate attesting to his disability as 

the reason for his non-return to duty. If' 

he returns to duty, sick leave earned will 

be credited towards this deficit. 

(4) Mr. Friedman has been granted the ma.xi.mum. 

allowable advanced sick leave of 24o hours. 

FOR OFFf Cf f.L USE.ONLY. 
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~FOR Orflfiltlt ~ C4il_~5s1 o 

In accordance with Federal J.eave regulations, no 

f'urther ad:va.nces may be granted. be:,iond this 

amount. 

3. Pay Account. 

a.. Mr. Friedman is presently euwlo;yed a.t the rate of 

$14,8oo per ;year. This rate provides bi .. weekly earnings a.s follows: 

(J.) Gross Salary :(;569.23 

(2) Less - 6cfo retirement deduction $34.15 

Federal Empl.oyees Insurance $ 3.75 

(! 37.90 

(3) Net saJ.a.ry before income taxes [?531.33 

(4) Wi thhol.ding Tax (based on O deductions) $102. 46 

(5) Take-Home Pay Check (see para. 6) ~28.87 

(6) Mr. Friedma.n's actual net pay after taxes is, 

of course, detemined by his total income f'or 

the ta.xa.b1e year. This data is provided only 

for the purposes of com;pa._'l'lison w1 th the statements pertaining to his retirement annuity. 

4. Retirement status. 

a.. Mr. Friedman is eligible tor optional retirement on 

the basis of age a.ud years of service. 

b. His actua.l retirement a.nnuity will be based. upon a 

series of involved calcula.tions made by the u. s. Civil Service 

Commission at the time his appl.ica.tion for retirement is processed. 
The follow:l.ng calculation is a.n approximate estimate and is 

accurate to within a very small amount. (Estimated DBX1mum 

error $10 per m::>nth. ) 

a. Retirement Annuity Calcula.tion. 

(l.) Service Credit - 34 yea.rs, 4 months; includes 

mil.itary service in World War I and Worl.d. 

We.r II. 

(2) Average annual salary for five highest yea.rs -

4;12,,276. 

(3) Annuity Ce.lculation. 

$12,276.00 

x .015 

$ 184.14 

X 34 1/3 years * 6,,322.14 

- 717.70 (see para. 4) $ 5,6o4.44 annue.1 annuity 

( 4) During the period from 1921 through 30 June 

1938, Mr. Friedman's employment was not 

subject to retirement deductions. An amount 

equal to lei of the Wldeposited retirement 

fUnds will be deducted from the annual annuity 

unless such funds ($7177.00) are deposited to 

the credit of this account. 

d. Annuity Payment Option. 

(l) Mr. Friedman rray elect to receive his annuity 

under either of two options. He has 1nd.1cated 

interest in the second option. 

3 

fOR OFflCIAL USE ONLY 
- -----=------------------------

. .fOR 0FflGi~lf3~~1~~ 35510 

(a) Full lite annuity to the retired employee 

with no survivor interest be;yond the date 

of the employee's death. under this 

option Mr. Friedman would receive a 

monthly retirement annuity of .$467.00. 

(b) Reduced ann.ui ty to the retired eq>loyee 

until date of death with an annuity equal 

to one-ha.lf' the full rate annuity pa.ya.bl.a 

to the survivor until death or remarriage. 

Under this option Mr. Fried.llla.n would 

receive a monthly retirement e.nnuity of 

1!>427.00 until death. Following this, 

Mrs. Friedman would receive an annuity of 

$234.oo per month until death or remarriage. 

(2) Take-Home Retirement Pay. 

(a) Mr. Fr1edm9.ll's annuity would be tax-free 

until the :f'ull amount contributed was 

returned to the annuitant. This would 

ocaur during the second year. Thereafter, 

the annuity would. be taxable as income. 

However, the Internal Revenue Code extends 

certain tax benefits towards retirement 

income whioh could result 1n the first 

$1200.00 of this annuity being ta.x free. 

The actual. tax status is dete:rmined by 

Mr. Friedman's total income picture. 

- ·-··- ---·------
However, assuming Mr. Friedman chooses 

the second pa~t option, his tax 

lia.bili ty based on this income per withholding tax schedules using the "r/J'' 

exemption category would a.pprox:Lma.te 

$59·00 per lllOnth after the $1200.00 

exeuwtion. 

(b) Mr. Friedman 1 s Federal insurance deduction 

will be discontinued at the age of 65 

(in approxims.tely 15 months). After that 

time, his insurance will remain in force 

without cost, although the a.mount w:f.ll 

reduce 2% per month after the age of 65. 

( c) From the above it ma.y be seen that 

Mr. Friedma.n's annuity under the second 

option will a.mount to a.pproxima.tely 

$368.00 per month after tax liability, 

compared to his present bi-weekly salary 

after deductions of' $428.87. 

5. Retention in Duty Status. 

a.. If it is determined. that Mr. Friedman will be physically 

able to return to work after a. period of conval.escence, he may be 

retained on the rolls of the Agency f'or an indefinite period of 

convalescence. 

b. Under this procedure he would normally be pla.ced on 

annual leave until his accrued leave (slightl.y J.ess 30 worldng days) 

FOR OFFF ,., ;: f' .. l- • l :'. ,., :·· : ' .-. .. 1 -(I •' f 1 . "" I,.,. ll ,.; If t,, • v ~ .• ~ L. ·~f ~ i . 

5 

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ha.s expired a:f't~r which time he would be placed in a. leavewi thout-pay status until his :i.-eturn to duty. Under this p1"0cedurc, 

Mr. Friedme.n would still be liable for the repa.:yment ot slightly 

\lnder *16oo.oo representing the 'l'lllliquida.ted advanced sick lea,•e, 

if lie did not return to a duty status. Howeve1·, presentation of 

a medical certii'ica.te attesting to the disability causing no11-

return to duty would constitute case for waiver of this unliqu1-

dated liability. 

c. As an alternative procedure, it could be dete1"lllined 

that Mr. Friednian should be pla.ced on a partial tour of active 

duty status receiving credit for worlt to be performed at his home 

during the pe1~iod of oonva.l.escence. In view of the nature of 

Mr. Fried.ma.n's work, it is feasible for the Director to determine 

that certs.in work should be perfo1'Dled at his 110me whe1-e he has 

direct access to his extensive technical library and other facilities. 

If', f'or example, Mr. Friedman were placed in a 20-hour 

per week tour of duty, he would draw his oal.ary at b.aJ.t rate and 

accrue a.nnua.l and siclt lea.ve a.t one-half the normal ra.te until 

such time as he is able to return to a tull tour of duty. 

6. Reenwlo;vment a.:rter Retirement. 

a.. An annuitant may be reemployed on a full-time basis; 

however, in such cases the sala.ry for the position is reduced by 

the :Cull amount of the annuity. 

b. Euwlo~t as a Consultant. Reen«>lo;yment as a. 

consultant can be eff"ected; however, the rate to be paid is subject 

FOR 0FflGU1 U:)E ONLVJ 

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• 

• 

,-_ 1 ... (jRli'.;F_ ·: T.D ; _.n.-=t.~.15 ~ 1 0 f U .,l f/,~, I I ,"'"'t l I ~"rl':n""V"" . \ "I I n.-~nt. \..,P~· !.... ~~~k~l.; , .• 

to an individual decision in each case by the u. s. Civil Service 

Commission. As a general statement, the daily consultant ra.te 

in such cases is determined by reducing the equi va.J.ent per a.mumi 

rate by that proportion of the annuity financed from government 

funds. 

From a. practical stand.point, such em;plo;yzn.ent would of'fer 

only l1mi ted inducement in the way of ad.di tional compensa.tion 

a.s a. means of retaJ.n:Lng Mi•. Friedman 1 s services • 

7. Contractual Services. 

a. It bas been suggested that one method of reta.ining 

frlr. Fr1edma.n 1s services wouJ.d be through the means of contractual. 

services. 

b. Recent determinations have been made to the effect 

that contracts f'or persona.1 services to perform work measured on 

a. time basis have the same status as enq>lo;yment as a. consultant, 

'With respect to the application of du.al conwensation limitations • 

c. It is possible, however, to contre.ct :f'or the performa.nce of personal. services to produce a definite end product 

or result, and under which contract performance is measured by 

the product rather than by time e~ended.. It bas been held in 

prior determi:cations that such contracts do not constitute 

Federal em,pJ.o:yment and a.s such are not subJect to dual compensation 

limitations. This matter has been checked with the Signal Corps 

Procurement Of'fice (Mr. Crafford) e.nd no bar is foreseen to 

drafting such a. contra.ct. 

7 
d. It has been suggested that such contracts might 

be draw with Mr. Friedman to produce definite end products such 

as one or more technical books 1 or resea.rcll reports, or other 

similar items. 

. -FOR OFFiCl;;L U3E OHL'(, 

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