On June 21, the Postal Service suspended the employer contributions in the defined benefit portion of the Federal Employee Retirement System (FERS.) The move was meant to conserve cash, saving $115 million a pay period.
FERs retirements are made up of three parts -- Social Security, Thrift Savings Plans, and the annuity, or defined benefit. This last part is the one that's affected.
The defined benefit is over funded by as much as $6.9 billion.
Currently 85 percent of employees are in the FERSs system.
It doesn't affect TSP accounts or the matching contribution to it. The OPM thinks the move could jeopardize service credits issued to employees that would count toward retirement. USPS disagrees and has referred the issue for resolution to the Office of Legal Counsel in the Justice Department.
What do you think about this? When should we resume payment once the new fiscal year starts?
PMG Donahoe has some comments and recorded a video.