Update: On February 6, a federal judge has temporarily blocked the effective deadline of the deferred resignation offer until February 8, in response to a lawsuit filed by labor unions representing federal employees.
The Office of Personnel Management (OPM) sent a message to all federal employees offering them the opportunity to retain all pay and benefits through September 30, 2025, if they resign from their positions by February 6, 2025. Often inaccurately referred to as a “buyout,” this is technically an offer of “deferred resignation,” and accepting it may make federal employees ineligible to accept unemployment insurance or require them to forfeit other benefits and protections. The legal grounding for this offer, or for the use of any federal funds to fulfill the terms offered, remains uncertain.
Further, given that the likely goal is to shrink the federal workforce, any federal employees who take this offer will likely not be replaced with new full-time hires, which would lead to further degrading agency functions and operations.
There are about 2.3 million civilian federal employees, not including Postal Service workers or members of the military. However, as a share of total government spending or as a share of the population, federal employment has already been shrinking significantly for decades. Compensation for the federal civilian workforce represents only about 5-6 percent of total government spending.