‘‘(4)(A) A phased retirement annuity shall not be 
subject to reduction for any form of survivor annuity, shall 
not serve as the basis of the computation of any survivor 
annuity, and shall not be subject to any court order requir-
ing a survivor annuity to be provided to any individual. 
‘‘(B) A phased retirement annuity shall be subject to 
a court order providing for division, allotment, assign-
ment, execution, levy, attachment, garnishment, or other 
legal process on the same basis as other annuities. 
‘‘(5)(A) Any deposit, or election of an actuarial annu-
ity reduction in lieu of a deposit, for military service or 
for creditable civilian service for which retirement deduc-
tions were not made or refunded, shall be made by a re-
tirement-eligible employee at or before the time the retire-
ment-eligible employee enters phased retirement status. 
No such deposit may be made, or actuarial adjustment 
in lieu thereof elected, at the time a phased retiree enters 
full retirement status. 
‘‘(B) Notwithstanding subparagraph (A), if a phased 
retiree does not make such a deposit and dies in service 
as a phased retiree, a survivor of the phased retiree shall 
have the same right to make such deposit as would have 
been available had the employee not entered phased retire-
ment status and died in service. 
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‘‘(6) A phased retirement annuity shall commence on 
the date on which a phased retiree enters phased employ-
ment. 
‘‘(7) No unused sick leave credit may be used in the 
computation of the phased retirement annuity. 
‘‘(d) All basic pay not in excess of the full-time rate 
of pay for the position to which a phased retiree is ap-
pointed shall be deemed to be basic pay for purposes of 
sections 8422 and 8423. 
‘‘(e) Under such procedures as the Director may pre-
scribe, a phased retiree may elect to enter full retirement 
status at any time. Upon making such an election, a 
phased retiree shall be entitled to a composite retirement 
annuity. 
‘‘(f)(1) Except as provided otherwise under this sub-
section, a composite retirement annuity is a single annuity 
computed under regulations prescribed by the Director, 
equal to the sum of— 
‘‘(A) the amount of the phased retirement an-
nuity as of the date of full retirement, including any 
adjustments made under section 8462; and 
‘‘(B) the product obtained by multiplying— 
‘‘(i) the amount of an annuity computed 
under section 8412 that would have been pay-
able at the time of full retirement if the indi-
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vidual had not elected a phased retirement and 
as if the individual was employed on a full-time 
basis in the position occupied during the phased 
retirement period and before any adjustment to 
provide for a survivor annuity; by 
‘‘(ii) the working percentage. 
‘‘(2) After computing a composite retirement annuity 
under paragraph (1), the Director shall adjust the amount 
of the annuity for any applicable reductions for a survivor 
annuity. 
‘‘(3) A composite retirement annuity shall be ad-
justed in accordance with section 8462, except that sub-
section (c)(1) of that section shall not apply. 
‘‘(4) In computing a composite retirement annuity 
under paragraph (1)(B)(i), the unused sick leave to the 
credit of a phased retiree at the time of entry into full 
retirement status shall be adjusted by dividing the number 
of hours of unused sick leave by the working percentage. 
‘‘(g)(1) Under such procedures and conditions as the 
Director may provide, and with the concurrence of the 
head of employing agency, a phased retiree may elect to 
terminate phased retirement status and return to a full- 
time work schedule. 
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‘‘(2) Upon entering a full-time work schedule based 
on an election under paragraph (1), the phased retirement 
annuity of a phased retiree shall terminate. 
‘‘(3) After termination of the phased retirement an-
nuity under this subsection, the individual’s rights under 
this chapter shall be determined based on the law in effect 
at the time of any subsequent separation from service. For 
purposes of this chapter, at the time of the subsequent 
separation from service, the phased retirement period shall 
be treated as if it had been a period of part-time employ-
ment with the work schedule described in subsection 
(b)(2). 
‘‘(h) For purposes of subchapter IV— 
‘‘(1) the death of a phased retiree shall be 
deemed to be the death in service of an employee; 
‘‘(2) 
except 
for 
purposes 
of 
section 
8442(b)(1)(A)(i), the phased retirement period shall 
be deemed to have been a period of part-time em-
ployment with the work schedule described in sub-
section (b)(2) of this section; and 
‘‘(3) for purposes of section 8442(b)(1)(A)(i), 
the phased retiree shall be deemed to have been at 
the full-time rate of pay for the position occupied. 
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‘‘(i) Employment of a phased retiree shall not be 
deemed to be part-time career employment, as defined in 
section 3401(2). 
‘‘(j) A phased retiree is not eligible to receive an an-
nuity supplement under section 8421. 
‘‘(k) For purposes of subchapter III, a phased retiree 
shall be deemed to be an employee. 
‘‘(l) For purposes of section 8445(d), retirement shall 
be deemed to occur on the date on which a phased retiree 
enters into full retirement status. 
‘‘(m) A phased retiree is not eligible to apply for an 
annuity under subchapter V. 
‘‘(n) A phased retiree is not subject to section 8468. 
‘‘(o) For purposes of chapter 87, a phased retiree 
shall be deemed to be receiving basic pay at the rate of 
a full-time employee in the position to which the phased 
retiree is appointed.’’; and 
(2) in the table of sections by inserting after 
the item relating to section 8412 the following: 
‘‘8412a. Phased retirement.’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall take effect on the effective date of the 
implementing regulations issued by the Director of the Of-
fice of Personnel Management. 
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SEC. 3. CONTRIBUTIONS TO THRIFT SAVINGS FUND OF PAY-
MENTS FOR ACCRUED OR ACCUMULATED 
LEAVE. 
(a) CIVIL SERVICE RETIREMENT SYSTEM.—Section 
8351(b)(2) of title 5, United States Code, is amended by 
adding at the end the following: 
‘‘(D)(i) A qualified phased retiree may, in addition 
to any contributions otherwise allowable, contribute to the 
Thrift Savings Fund by direct transfer any part of any 
amount otherwise payable to such retiree for accumulated 
and current accrued annual or vacation leave under section 
5551 or 5552. 
‘‘(ii) For purposes of this subparagraph, the term 
‘qualified phased retiree’ means a phased retiree (as defined 
by section 8336a) who has completed at least 1 year of serv-
ice as such a retiree.’’. 
(b) FEDERAL EMPLOYEES’ RETIREMENT SYSTEM.— 
Section 8432(a) of title 5, United States Code, is amended 
by adding at the end the following: 
‘‘(4)(A) A qualified phased retiree may, in addition 
to any contributions otherwise allowable, contribute to the 
Thrift Savings Fund by direct transfer any part of any 
amount otherwise payable to such retiree for accumulated 
and current accrued annual or vacation leave under section 
5551 or 5552. 
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‘‘(B) For purposes of this paragraph, the term ‘quali-
fied phased retiree’ means a phased retiree (as defined by 
section 8412a) who has completed at least 1 year of service 
as such a retiree.’’. 
(c) REGULATIONS.—The Executive Director of the Fed-
eral Retirement Thrift Investment Board shall prescribe 
regulations to carry out the amendments made by this sec-
tion. 
(d) EFFECTIVE DATE.—The amendments made by this 
section shall take effect 1 year after the date of the enact-
ment of this section, or upon such earlier date as may be 
established by the Executive Director of the Federal Retire-
ment Thrift Investment Board under the regulations pre-
scribed under subsection (c). 
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Union Calendar No. 383 
112TH CONGRESS 
2D SESSION 
H. R. 4363 
[Report No. 112–535] 
A BILL 
To amend title 5, United States Code, to allow 
Federal employees to continue their public serv-
ice while partially retired. 
JUNE 15, 2012 
Reported with an amendment, committed to the Com-
mittee of the Whole House on the State of the Union, 
and ordered to be printed 
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