OPM updates regs to reflect modernized retirement system

The Office of Personnel Management has proposed a new rule to incorporate substantive changes to the Code of Federal Regulations to accommodate the changes the Retirement Systems Modernization (RSM) project will bring. OPM’s rule, issued Aug. 17, provides alternative provisions for processing retirement and health and life insurance applications, notices, personal benefit elections and records. The rule does not change the federal code, but it does add new provisions that would supersede the existing language when necessary, OPM stated in the proposed rule. “The nature of [RSM] requires regulations to accommodate two somewhat unusual program needs,” the proposed rule stated. “First the regulations must allow for differing requirements of two retirement processing programs operating simultaneously. Second, because of the technology and procedures of the initiative are still in development and will continue to evolve even when the initiative becomes operational, the regulations cannot be specific on many subjects, but must be sufficiently flexible to enable the initiative to operate.” RSM will modernize the existing federal retirement system by improving services through new technologies and business processes. It is a multiphase, multiyear program that will revamp various processes that provide services to employees participating in the government’s retirement program. OPM plans to implement the first phase of RSM in February 2008. The first phase includes transferring current employees and annuitants whose retirement benefits are administered by the General Services Administration.OPM hired Hewitt and Associates in May 2006 under a $290 million contract to create a database that will let employees view their work history and salary, calculate retirement benefits, and model retirement benefits by projecting years of employment and future salary increases.The agency then chose Accenture for a $40 million contract that will provide more efficient information technology and business systems to expedite how retirees receive retirement benefit checks. The proposed rule, for which comments are due Sept. 17, would make it easier for OPM to implement functions such as electronic signatures, online submission of forms or notices and the acceptance of electronic records from feeder systems such as the Enterprise Human Resources Integration initiative or electronic official personnel folders. To implement many of these changes, OPM’s director must issue a directive that would “affect only regulations governing process-oriented requirements, such as requirements that applications, forms or notices be in writing.” A directive would outline what type of electronic signatures RSM would accept, while another would describe how employees could submit electronic applications for benefits. A final directive would describe the acceptable e-records that agencies could submit to RSM. The proposed rule also stated that employees who are retiring would have 35 days from the date of their notice of retirement to change any survivor benefit elections or any other benefit elections.