Sick leave retirement credit in 2026: what unused hours add to a FERS annuity
Unused sick leave is not paid out when you leave federal service, but it can raise your FERS annuity. Type your hours and your high-3 to see by how much.
Service your sick leave adds
8 months
$700 a year on your annuity, for life.
| Hours | 1,500 |
| Years and months | 0 and 8 months |
| Annuity gained per month | $58 |
Counts in the computation of an immediate annuity only: never toward the 20 or 30 years you need to retire.
Prepared by Radif Partners · How the figures are built · read on opm.gov, ecfr.gov and ssa.gov · not an official determination
Under FERS, 100 % of your unused sick leave has counted in the annuity computation since 2014: OPM converts the hours into service at the rate of 2,087 hours for one year, about 174 hours for one month, and adds them to your years before applying the 1 % or 1.1 % multiplier. With 1,500 hours, that is 8 extra months; on a $105,000 high-3 at 1 %, the annuity rises by about $700 a year, for life and with every later COLA. A 30-year retiree at the MRA goes from $31,500 to $32,200 a year before any survivor reduction. Sick leave never counts toward eligibility: 29 years and 10 months of service plus a year of sick leave does not make the 30 years needed at the MRA. It is credited to an immediate or MRA+10 annuity only. If you leave federal service and take a deferred annuity, the hours are lost, and they are never paid in cash.
From hours to months of service
When you retire, your agency reports your unused sick leave on the final leave statement. OPM divides the hours by 2,087, the hours of a work year, and converts the result into years, months and days. That credit is added to your creditable service, and the total is used in the annuity formula. Any days left over that do not make a full month are dropped. The conversion chart OPM uses is in chapter 50 of the CSRS/FERS Handbook.
| Unused hours | Months added | Annuity gain per year at 1 % | At 1.1 % |
|---|---|---|---|
| 500 | 2 | $175 | $193 |
| 1,000 | 5 | $438 | $481 |
| 1,500 | 8 | $700 | $770 |
| 2,087 | 12 | $1,050 | $1,155 |
| 3,000 | 17 | $1,488 | $1,636 |
| 4,000 | 22 | $1,925 | $2,118 |
The value of an hour depends on your high-3 and your multiplier, not on your grade at the time you earned it. A month of credit is worth one-twelfth of 1 % of the high-3 a year, or one-twelfth of 1.1 % if you retire at 62 or later with 20 years. On a $105,000 high-3, that is $88 a year per month of credit at 1 %.
What your unused sick leave adds to the annuity
Service your sick leave adds
8 months
| Hours | 1,500 |
| Years and months | 0 and 8 months |
| Annuity gained per month | $58 |
Computation only, never eligibility
The rule that surprises most employees is that sick leave does not move the retirement date. Section 8415(m) of title 5 adds unused sick leave to the service used to compute the annuity, nothing more. Every eligibility test of the MRA with 30 years, 60 with 20, 62 with 5, MRA+10 or the special provisions is counted on actual creditable service. A balance of 2,087 hours will not turn 29 years into 30.
The same holds for the 1.1 % multiplier. It needs 20 years of service at separation at age 62 or later, and sick leave does not count toward the 20. It also stays out of the supplement: OPM counts FERS civilian years for the FERS supplement, without sick leave or military service. For the special provisions, sick leave raises the annuity but does not help reach 20 or 25 years of covered service.
Which retirements get the credit
The credit goes to an immediate annuity: the MRA with 30 years, 60 with 20, 62 with 5, the special provisions, an early-out retirement and the reduced MRA+10 annuity. The survivors of an employee who dies in service also receive it in the computation of their annuity. It does not go to a deferred annuity, the one you claim years after leaving federal service before retirement age. That is why an employee who resigns at 45 with a large balance and waits for a deferred annuity gets nothing for it.
Three cases with the numbers
A worker born in 1969 retires at the MRA of 56 and 10 months with 30 years and a $105,000 high-3. Without sick leave the basic annuity is $31,500 a year. With 1,500 hours on the books it becomes $32,200, and with a full year of 2,087 hours it becomes $32,550. Over 25 years of retirement, the 1,500 hours alone pay about $17,500 before COLAs.
A worker who stays to 62 with 25 years gets the 1.1 % multiplier, so each month of credit is worth a little more: $28,875 a year without sick leave, $29,645 with 1,500 hours. A former employee who left at 45 with 15 years and 1,500 hours, and who claims a deferred annuity at 62, receives $13,500, the same as if the balance had been zero.
Is it worth saving sick leave?
Sick leave exists to cover illness, and that comes first. The value of a balance kept to retirement is real but modest: on the example above, a month of credit adds less than a hundred dollars a year. The statute credits only hours for which you have not received payment, and the hours never become cash when you leave. The credit also follows any survivor election, so a full survivor annuity of 50 % includes half of the extra amount. Before you pick a retirement date, ask your agency for the hours shown on your last leave and earnings statement, then type them in the FERS retirement calculator with the rest of your record.