June 11, 2018
Disability retirement is an employee benefit intended for employees who are unable to complete a normal career due to disease or injury. To be eligible for retirement disability, employees must meet prescribed statutory, regulatory, and administrative criteria.
The objective of our audit was to assess the Postal Service’s effectiveness in processing disability retirement applications.
The Office of Personnel Management (OPM) administers disability retirements for the Postal Service and the federal government, including approving/disapproving disability retirement applications. The Postal Service’s Human Resources Shared Services Center (HRSSC) and Eagan Accounting Service Center (ASC) are responsible for helping employees complete the disability retirement application, collecting the applicants’ financial information, and submitting the application to OPM.
In fiscal year 2017, there were 23,426 Postal Service employees who retired, which accounted for about 25 percent of all federal government retirees. In addition, about 2,000 more employees applied for disability retirement.
What the OIG Found
The Postal Service is effective in processing retirement disability applications and submitting them to OPM in time to meet its informal timeliness goals; however, as of September 30, 2017, there were 1,195 employees who had been waiting over six months for an application decision from OPM. Of those employees, 398 had been waiting for a decision for over a year. We statistically sampled 94 of the 398 applications submitted by these employees. The Postal Service processed 95 percent (89 of 94 cases) of disability retirement applications in time to meet its informal goals.
Postal Service Human Resource management meets with OPM monthly to discuss various human resources issues, including the status of disability retirement applications. According to Postal Service management, OPM does not always provide sufficient information regarding disability retirement application status, nor does it always notify the Postal Service of application decisions.
When disability retirement decisions are not rendered timely, there can be an adverse impact on the employee, including loss of income and loss of health and life insurance benefits. Of the 94 applications we reviewed, 20 employees had been in leave without pay status for more than one year and had their health and life insurance benefits lapse. Additionally, the Postal Service cannot hire new employees to backfill positions occupied by employees in a leave without pay status while waiting for an application determination.
What the OIG Recommended
We recommend management continue to coordinate with the Office of Personnel Management to address disability retirement application delays, and if necessary, escalate concerns to Office of Personnel Management oversight bodies, such as Congress, the Government Accountability Office, and the Office of Personnel Management Office of Inspector General.
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