§638b Voluntary Retirement Incentive

Summary

The Secretary of Defense may let a military department offer a one-time voluntary retirement payment to certain officers. The authority ends no later than December 31, 2018, and no more than 675 officers can get the payment. To be eligible, an officer must have served more than 20 but not more than 29 years on the approved retirement date, meet the law’s minimum commissioned service rules (sections 7311, 8323, or 9311), have at least 12 months left before reaching the maximum years of service for their grade (sections 633 or 634), have at least 12 months before reaching any maximum retirement age, and meet any extra rules the military department sets (for example, about years of service, skills, specialty, grade, or required service left). Officers being considered for disability retirement or severance, moved to a temporary disability list, projected for certain retirements or discharges, or facing pending disciplinary or separation actions are not eligible. The payment amount is set by the military department but may not be more than 12 times the officer’s monthly basic pay and can be paid in a lump sum. If an officer takes the incentive and later returns to active duty, the military will deduct the incentive from their pay in monthly installments until it is fully repaid, unless the return to duty was involuntary (including involuntary recall to active duty or full-time National Guard duty). The Secretary of Defense can waive repayment in whole or in part if recovery would be unfair or against the United States’ best interest. That waiver power may be delegated only to the Under Secretary of Defense for Personnel and Readiness and the Principal Deputy Under Secretary of Defense for Personnel and Readiness.