# Plain Language Summary: LEO Fair Retirement Act of 2022

Federal law enforcement officers often work significant amounts of overtime that they never get paid for. This happens because federal law has a cap on how much overtime pay these officers can receive in any given year. If an officer works extra hours that would push their total pay above this cap, they simply don't get compensated for those hours—they work for free. This bill fixes that problem by allowing law enforcement officers to count those unpaid overtime hours toward their retirement benefits.

Here's how it works in practice: Say a federal agent works 200 hours of overtime in a year but only gets paid for 100 hours because of the pay cap. Under current law, those 100 unpaid hours disappear—they don't count toward anything. This bill lets officers reclaim credit for those unpaid hours when calculating their retirement pension. However, there's a catch: officers have to pay money upfront to get this benefit. Specifically, they'd need to pay back the employee and employer contributions that would have been made on that unpaid overtime if they had actually been compensated for it. Officers can make this payment from their Thrift Savings Fund (a retirement savings account similar to a 401k) or pay it as a lump sum. They'll have about six months to decide whether they want to do this after getting an estimate of what it will cost and how much their retirement benefit will increase.

The bill also expands "availability pay"—a special form of compensation for certain law enforcement positions that requires them to be available for emergency calls—to include more types of federal law enforcement officers like Postal Inspectors, federal air marshals, and probation officers. Finally, the bill provides a tax credit for officers who make these lump-sum payments, so they get some tax relief on the money they're putting toward their retirement calculations.

LEO Fair Retirement Act of 2022

Pascrell, Bill

LEO Fair Retirement Act of 2022 This bill makes a series of changes to certain retirement and premium pay calculations for federal law enforcement officers (LEOs). Specifically, the bill provides that for purposes of computing the annuity of an LEO under the Civil Service Retirement System and the Federal Employees Retirement System, any premium pay earned by such LEO in excess of limitations imposed on such pay shall be included in the LEO's average pay, contingent on the payment of a specified lump sum by the LEO to the Office of Personnel Management. The bill allows for a nonrefundable tax credit with respect to such lump-sum payments. The bill also makes postal inspectors, federal air marshals, and other specified personnel eligible for availability pay (i.e., premium pay paid to LEOs who are criminal investigators).