The Foreign Service Journal, June 2004

8 AFSA NEWS • JUNE 2004 M any AFSA members have been asking about the mandatory retirement age of 65. Questions such as these keep being raised: Is there any chance that the age will be raised? What would need to be done to change the age? What is AFSA’s position on this issue? These questions come from two dis- tinct groups of members: • Those who want to go onwork- ing in the Foreign Service after age 65. They are generally fit, feel they have several more years of valuable service to offer, and do not want to change careers, usually again, at age 65; and • Those who are concerned because of the timing of when they become eligible for full Social Security payments. Background The current Foreign Service mandatory retirement age of 65 dates from the passing of the new Foreign Service Act of 1980. Prior to 1980, the mandatory retirement age was 60. In the 1970s, a group of Foreign Service officers filed an unsuccessful class action suit to protest their mandatory retirement at age 60. The case (Vance v. Bradley) went all the way to the Supreme Court, where the majority opinion held that themandatory retirement age for the Foreign Service that is lower than the Civil Service does not violate the Equal Protection Clause. The court held that a mandatory retirement age of 60 was rationally related to further a legitimate state interest. The court distinguished the Foreign Service from the Civil Service, saying, “it was quite rational to avoid the risks connected with having older employees in the Foreign Service but to tolerate those risks in the Civil Service.” The court also noted that although societal facts such as increasing life expectancy of Americans are valid, it is up to Congress to determine public pol- icy. With the Foreign Service Act of 1980, Congress duly obliged by raising the mandatory retirement age to 65. Any future change in the retirement age requires congressional action. There are a number of considerations that Congress must take into account when evaluating another age change. The Up-and-Out System First among these considerations is the rank-in-person system upon which the whole Foreign Service is based. Upward mobility comes through selection for pro- motion to a higher rank, and the num- ber of vacancies at those higher ranks depends on an adequate rate of flow- through. If people did not move out of the upper end of the promotion ladder, space would not become available for younger talent to move upwards. Congress has provided several ways to encourage this flow-through. First, it required the State Department to insti- tute time-in-class and time-in-service lim- its so that employees who do not achieve promotion to a higher rank are required to retire after a specified time, thereby allowing room for promotions. Within this requirement, they provided a second incentive so that those who reach their TIC or TIS dates at the FS-1 level or in the Senior Foreign Service will be eligi- ble for full retirement benefits. Thirdly, recognizing that many employeesmay look for a change to a less stressful way of life after age 50, Congress provided that anyone under the Foreign Service Retirement system could retire with full annuity at age 50 after 20 years of government service, of which five years must be in the Foreign Service. A further wrinkle here is that those who retire under the Foreign Service Pension System(FSPS, the “new” system), for whomSocial Security forms a part of their annuity, will receive an annu- ity supplement until they reach age 62, the earliest age at which one can draw Social Security. Finally, of course, recognizing that older employees are, generally, more like- ly to have health problems and to be less available for assignment world- wide, it legislated the requirement to retire at age 65. The Social Security Dilemma In the early 1980s, Congress became aware that the Social Security system might run into funding problems in the foreseeable future, and also recognized that people generally wanted to work longer. Accordingly, Congress passed leg- islation gradually raising the age at which employees could collect full Social Security benefits. Beginning with those born in 1938, eligibility for full Social Security payments is moving slowly upwards until it reaches 67 for those born in 1960 and later. The table shows the progression (see p. 9). Conventional wisdom has always been that you should start drawing Social Security as soon as you are eligi- ble—those under FSPS who retire from the Foreign Service, for instance, should apply at age 62. The rationale for this is Upward mobility comes through selection for promotion to a higher rank, and the number of vacancies at those higher ranks depends on an adequate rate of flow-through. RETIREMENT AT 65 No Change in Sight for Mandatory Retirement Age BY JAMES YORKE, AFSA LABOR MANAGEMENT SPECIALIST