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Navy Offers Early Retirement Program

The Chief of Naval Operations Adm. Jonathan Greenert announced plans Jan. 19 to offer voluntary early retirement to certain Sailors separating due to the Enlisted Retention Board (ERB), during an all hands call at Joint Base Pearl Harbor-Hickam.

The National Defense Authorization Act, signed into law Dec. 31, 2011, reinstated the authority for the Department of Defense to implement Temporary Early Retirement Authority (TERA) for Sailors who have completed at least 15 years of service. TERA is a temporary, voluntary program that offers voluntary early retirement at a reduced monthly annuity to eligible members with 15 to 20 years of active service.

Eligible Sailors who desire early retirement under TERA must submit an application. TERA is not an entitlement, so all applications may not necessarily be approved. Once program application procedures are established, Sailors may still be able to separate prior to 1 September 2012 if their application is approved and they have accumulated 15 years of active service.

Sailors whose TERA application is approved will be retired voluntarily no later than Sept. 1, 2012, and will not be entitled to involuntary separation pay (ISP). However, Sailors will remain qualified for enhanced ERB transition benefits until their retirement date.

10 Qs & As on the initiative:

Q1:  What is the process/ mechanism for applying for early retirement? What is the approval process? What do eligible Sailors need to know to take advantage of this?
A1: As discussed in NAVADMIN 025/12-Navy is still in the process of formalizing the process. Application procedures will be developed and announced by a future NAVADMIN. In the meantime, TERA eligible Sailors are authorized a Short Term Extension (STE) to extend their SEAOS to 1 September 2012 to ensure they have the opportunity to receive TERA benefits.
Pers-81 is now accepting Short Term Extension requests for eligible Sailors via email to pers-81@navy.mil .

 Q2: What requirements must Sailors meet in order to receive a retirement under TERA?
A2: Navy’s  TERA plan is specifically targeted toward ERB Sailors not selected for retention. In order to be eligible, a Sailor must not have been chosen for retention by the ERB, and must have completed a minimum of 15 years of active service as of 1 September 2012. There are no waivers to these eligibility requirements.

Q3: How much money will Sailors who receive an early retirement under TERA receive?
A3: TERA retired pay is calculated in a similar manner as regular retired pay, minus a small reduction factor.  Specific guidance may be found in 10 USC Sec. 1409 and the NDAA for FY93 (Public Law 102-484). Amplifying guidance will be published via NAVADMIN.

Q4: If the ERB is considered an involuntary separation, how can Sailors qualify for TERA, a voluntary separation program?
A4: Navy is utilizing the results of the ERB to determine eligibility for TERA.  Eligible Sailors who wish to apply for TERA will have their ERB results held in abeyance to facilitate their application for voluntary retirement.  In all cases, Sailors approved for TERA will have their ERB results vacated and must retire on or before 1 Sep 2012.

Q5: Would Sailors who receive TERA qualify for Involuntary Separation Pay, and other involuntary separation benefits – including the enhanced transition benefits afforded to only ERB separating Sailors (such as COOL waivers, assistance from the Outplacement service contract from Challenger, Gray & Christmas, Inc, etc) ?
A5: Eligible Sailors who apply and are approved for early retirement will be retired voluntarily.  Involuntary Separation Pay (ISP) is not authorized for Sailors retiring early under TERA. While those Sailors offered TERA will no longer qualify for ISP, they will remain qualified for enhanced ERB transition benefits until their retirement date.  Sailors should discuss the benefits of early retirement versus involuntary separation pay with their families and Command Retention Teams.

Q6: Why does a Sailor have to have 15 YOS by 1 Sept 2012? Is there any waiver process for those who are close?
A6: 1 September 2012 is the date previously established for separation of ERB Sailors.  The law specifically requires that the service member must have at least 15 but less than 20 years of active service to qualify for TERA. The Navy understands that there may be Sailors who may be months or weeks short of reaching 15 years of service by Sept 1, 2012. Unfortunately, there are no waivers to eligibility requirements, even if Sailors remain on active duty for another reason.  All Sailors not eligible to apply for early retirement are encouraged to pursue the available transition assistance and involuntary separation benefits.

Q7: Does the Navy plan to offer TERA to Sailors who are separating under other force-management programs, such as Perform to Serve or High Year Tenure?
A7: By law, TERA may only be offered to service members who have completed at least 15 years of active service.  PTS is only applicable for Sailors with up to 14 years of service, so Sailors separated through PTS would not qualify.  Likewise,  E5 HYT is 14 years and E6 HYT is 20 years so TERA would not be applicable to HYT situations. Because of their time-sensitive nature, commands are encouraged to expedite these requests.

Q8: If ERB Sailors have already separated due to a job offer, are they eligible for TERA after the fact?  Is there a process to retroactively receive retirement benefits under TERA?
A8: Any Sailor who separated prior to implementation of the policy, but who otherwise would have qualified, may petition the Board for Correction of Naval Records for redress.  However, the law is specifically written to go into effect on 31 December 2011, so it does not appear to be applicable to any Sailor who separated prior to that date.

Q9: Why didn’t the Navy utilize TERA to begin with, instead of conducting the ERB?
A9: At the time of the ERB, TERA was not legally authorized.

Q10: Will Sailors who take an early retirement under TERA be required to affiliate with the Reserves? 
A10: No, a Sailor who retires under TERA incurs no reserve obligation.

 

FOR ADDITIONAL QUESTIONS, contact your chain of command. Sailors can also call the NPC Call Center at 1-866-U-ASK-NPC (1-866-827-5672). NPC will also contact each TERA-eligible Sailor or their command.

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