Federal employees have until Thursday to decide whether or not they want to take a “deferred resignation” offer that would have them get paid for another eight months without having to work. If the private sector offers any indication, here’s what could happen. President Donald Trump is taking a page out of the private sector’s playbook—and from Elon Musk’s transition to becoming owner of Twitter, now X—in his sweep of federal employees. Last Tuesday, federal workers received an email offering them the option to resign effective September 30 in what many are calling a buyout. Employee buyout programs are common in the private sector, with companies offering one-time lump sum payments, or months of severance, or pension enhancements, or some carefully constructed combination of incentives, before resorting to mass layoffs. “They are a way for organizations to create an opportunity for people who were otherwise thinking about leaving, often in times of change or transformation,” says Ron Seifert, a senior client partner at Korn Ferry’s benefits practice. While Trump’s offer is not technically a buyout––it would have employees remain on the federal payroll until the end of the fiscal year, a point of concern with members of Congress and employment lawyers who question how these employees would be paid for not working––it is similar to private sector buyout deals. Indeed, buyouts can be a “compassionate” offer to employees already on the fence about leaving a company. But clarity in communication is key in maintaining your workforce––both those planning to leave and those planning to stay––satisfied, adds Allison Vaillancourt, vice president at benefits and HR consultancy Segal Group. And they are especially common in periods of transition, like an administration change. How many people will take the Trump Administration up on its offer is still up in the air. Though the Office of Personnel Management estimated that between 5% and 10% of employees would take the deal, saving the government $100 billion. But only 1% of the more than 2 million civilian workers offered the resignation have taken it so far, according to Axios. That is closer to $3.1 billion in savings to the taxpayer. Some workers, like military and immigration personnel, are excluded from the offer. Air traffic controllers who initially received the email announcing the buyout option later learned that they were exempt from a CNN report. Even for those who have already accepted––by replying “resign” in response to the now infamous “Fork in the Road” email––instructions are unclear. One employee who spoke to ABC News said that they have not heard back from OPM about the status of their resignation, and was told by their manager that they should have waited for more guidance before accepting the offer. With just two days before the deadline, here’s what federal workers should be asking before they take the deal, according to Forbes contributor Gena Cox. |