Sample Separation Agreement Language
Federal Employees Retirement System (FERS) & Civil Service Retirement System (CSRS) (Defined Benefit Plans)
This model may be used for the monthly pension plans provided by the United States government. Like all models it will need to be modified to fit the exact circumstances of the parties’ agreement and the rules of the plan.
a. The Husband/Wife is an “Employee” covered by the Federal Employees Retirement System (FERS) OR the Civil Service Retirement System (CSRS). The Husband/Wife (Former Spouse) is granted a portion of the Employee’s Federal Government retirement benefits as described below. The marriage began ___________ and ended __________, and any service credits that were purchased during the marriage will be treated as marital.
b. Amount of Benefits Assigned: The Former Spouse is assigned a pro rata share of any Employee annuity payments (commonly referred to as a monthly pension) under the Federal Government retirement system (including cost-of-living adjustments and supplements), as described in 5 CFR section 838.621, which is 50% of the marital portion using a coverture fraction. However, if the Employee receives a Federal Government disability retirement annuity, the assignment only applies to disability annuity payments after the Employee reaches age 62, and the pro rata share coverture fraction shall include all service used to calculate the amount of the disability annuity, including periods of disability that are treated as service for such calculation.
c. Refund of Employee Contributions: If the Employee has enough service at termination of employment to qualify for an annuity, even if the Employee has not reached the age required to begin the annuity, the Employee is barred from requesting a refund of Employee contributions (and interest) because such refund would extinguish the Former Spouse’s right to the survivor annuity and/or the portion of the Employee’s annuity assigned to the Former Spouse. Otherwise, the Former Spouse is assigned a pro rata share of any such refund, as described in 5 CFR section 838.621, which is 50% of the marital portion using a coverture fraction.
d. Survivor Annuity and/or Death Benefits: The Former Spouse is assigned a survivor annuity (including a basic employee death benefit under FERS, if applicable) that is equal to a pro rata share, as described in 5 CFR section 838.922, which is the marital portion using a coverture fraction. The Employee and Former Spouse shall share equally the cost of the survivor annuity.
e. Survivor Annuity Life Insurance Protection: If the Former Spouse (1) remarries before age 55 and (2) was married to the Employee fewer than 30 years, which would terminate the Former Spouse’s survivor annuity assignment, the Former Spouse shall have the right to obtain term life insurance on the Employee’s life. The life insurance shall be an amount no greater than [$_____], with the Former Spouse as the policy owner. The Employee shall cooperate by providing information, submitting to physical exams, and taking other reasonable measures that are necessary for the Former Spouse to secure and maintain the insurance.
f. Former Spouse’s Death: If the Former Spouse dies before the Employee dies, the assigned benefits shall revert to the Employee.
g. COAP Preparation: The Former Spouse shall promptly prepare and submit to the U.S. Office of Personnel Management (OPM) a court order acceptable for processing (COAP), as defined in 5 CFR section 838.103, that is consistent with this Agreement. The Employee shall cooperate and provide any documents or authorization necessary to complete the COAP process.
h. Continued Jurisdiction: The court shall retain jurisdiction to amend the provisions of the Order, to amend the COAP, to issue new orders to enforce the parties’ intent regarding the Employee’s Federal Government retirement benefits that are assigned to the Former Spouse, and to issue other orders that are just and equitable and not inconsistent with any other provision in this Agreement.
i. Indemnification for Employee’s Action/Inaction: The Employee shall not act, or refuse to act, in any manner that could diminish the Former Spouse’s rights in this Agreement or in the related COAP. If the Employee does take such action or inaction, the Employee shall make payments directly to the Former Spouse to the extent necessary to restore the Former Spouse to the position he/she would otherwise have been in without the Employee’s action/inaction.
j. Employee Payments to the Former Spouse: If OPM does not pay any portion of the assigned benefit to the Former Spouse (e.g., if the assigned benefit exceeds the Employee’s net annuity), the Employee shall pay that portion directly to the Former Spouse within 7 days after the date the Former Spouse would otherwise have received it.
k. Other Plans: The parties each represent that they have an interest in the following additional retirement plans:
HUSBAND’S / WIFE’S PLANS:
[list names of other plans here]
WIFE’S / HUSBAND’S PLANS
[list names of other plans here]
l. The parties represent that they do not have an interest in any plans not mentioned in paragraphs a to k above.
m. Except as provided in paragraphs a to j above, the parties waive any interest they may have in any retirement plan in the name of the other party, listed in paragraph k above, as further provided in this paragraph m.
The parties shall execute any spousal waivers that may be required under the Retirement Equity Act of 1984 or any existing or similar federal or state statute that may be enacted. This paragraph is intended to substitute for any other statement, prepared form or document which might be required by any plan, fund, trust, administrator, trustee or similar entity or person, so that each party may receive said benefits as if the parties never married.
Each party (as “Releasee”) hereby elects, and the other party (as “Releasor”) hereby consents to, a waiver and release of any and all benefits, including, without limitation, the qualified joint and survivor annuity benefit form of benefit under all pension, retirement, death benefit, stock bonus or profit-sharing plans, systems or trusts (hereinafter collectively called “employee plans”) of which the Releasor is, or may become, a participant, beneficiary or member. This waiver and release is meant, without limitation, as a waiver pursuant to Internal Revenue Code Section 417(a). If requested, the Releasor shall consent in writing, in any form requested by the Releasee, to any such election. The spousal consent of the Releasor set forth herein is irrevocable. Each party acknowledges that he/she has received an explanation of a qualified pre-retirement survivor annuity in accordance with Internal Revenue Code Section 417(a)(3)(b) and that the effect of this consent is to deny Releasor any right, interest or annuity in, to, or from the Releasee’s benefits under any employee benefit plan, now or in the future.
The Releasor acknowledges and hereby consents to the Releasee’s election that upon Releasee’s death, all death benefits under any employee plan of the Releasee will be paid to such person as Releasee may have designated at any time before the execution of this Agreement or may designate from time to time hereafter, in Releasee’s sole and unfettered discretion.
If the Releasor shall receive any part of or benefits from the Releasee’s account or accrued benefit in any employee plan, other than pursuant to a beneficiary designation executed after the date hereof by the Releasee which designation expressly names the Releasor as a beneficiary, Releasor shall promptly turn same over to the Releasee (or if the Releasee if not then living, to his/her designated beneficiaries under said employee plan, if any, or if there is no designated beneficiary, to the Releasee’s estate).
The parties intend that this Agreement be accepted as a spousal consent by each of them as Releasee to a waiver of a qualified pre-retirement survivor annuity pursuant to Internal Revenue Code Section 417(a).
n. Nothing herein shall be deemed to waive either party’s Social Security rights.