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What Federal Retirees Should Know About Their Military Service Credit Deposit, Catch 62 and the MSPB

By Christopher Attig


Federal employees with prior military service are (or should be) acutely familiar with provisions known as the “Catch-62” provision.

Certain civilian employees of the federal government who have prior military service may, by making a pre-retirement deposit, buy their post-1956 military service into their federal retirement annuity. By paying a percentage of their military earnings to their employing agency before they retire, Federal employees get the benefit of an increased annuity for the duration of their retirement

If a Federal employee fails to make the deposit prior to retirement, his/her retirement annuity is reduced by OPM if and when he/she become eligible for Social Security benefits at age 62.

In most situations, a retiree whose annuity is reduced can appeal to the MSPB. When OPM reduces the retiree’s annuity, and claims that the reduction is due to failing to make the military deposit prior to retirement, the retiree will have an opportunity to request that the OPM reconsiders its decision. If OPM still denies the retiree’s claim and reduces the annuity, the OPM is required to inform the retiree of his or her right to appeal your Catch-62 claim to the Merit Systems Protection Board (MSPB).

Typically, the MSPB has found that if the retiree’s employing Agency commits “administrative error” and as a result of that “administrative error” the retiree do not make the deposit, the MSPB will order OPM to accept a late deposit and reverse the reduction in the annuity. McCrary v. Office of Personnel Management, 459 F.3d 1344, 1349 (Fed. Cir. 2006).

“Administrative Error” can occur in any number of ways. The following are examples of cases where “administrative error” has been found:

1) The retiree is misled or not told the correct amount of the military service credit deposit before retirement.
2) The retiree is not told of the actual consequences of not making the deposit.
3) The retiree is not told when and how to properly make the military service deposit.
4) The employing agency confuses the employee as to the amount of the deposit or the effect of any failure to make the deposit on the annuity recalculation.

If your retirement annuity is reduced to the “Catch-62” provisions, or if you feel that you failed to make the military service credit deposit due to “administrative error”, the MSPB may be able to provide you relief or remedy.

If you have questions about your Catch-62 appeal, contact an experienced MSPB attorney.

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