UPDATE: The "deferred resignation" scam

Last week, Popular Information broke down the "offer" that the Trump administration was making to millions of federal employees to induce them to resign voluntarily. The Trump administration wanted federal employees to believe that if they agreed to resign effective September 30, they would receive their full pay until then and not have to work for the next eight months.

Elon Musk, who engineered the deal through the Office of Personnel Management (OPM), claimed on X that "[t]hose deciding to take the deferred resignation deal can do anything they want for the next eight months and are not required to work at all whatsoever." Many media outlets amplified this false narrative. The offer was widely reported as a "buyout," even though it did not include a lump sum payment or terminate the federal employees' work obligations.

The fine print of the deal, which at the time was detailed in an email and series of online FAQs, made it clear that employees could be required to work until their official resignation date. This means that federal employees could be agreeing to resign in exchange for nothing.

So far, about 20,000 federal workers, approximately 1% of the federal workforce, have accepted the offer, a Trump administration official told Axios. In a typical year, about 6% of the federal workforce turns over, so most of those accepting the deal may have been planning to quit or retire anyway. The administration was hoping to convince 5-10% of federal employees to resign.

On Monday, two days before the offer expires, OPM released a new memo and a contract providing more specificity about the terms of the deferred resignation agreement.

It is even worse than it initially appeared.

Federal employees agree to resign; the federal government agrees to do whatever it wants

The most important part of the contract released by OPM is Section 13. It states that the federal employees who accept the agreement waive their right to enforce the agreement in court or in any other forum.

Employee forever waives, and will not pursue through any judicial, administrative, or other process, any action against [AGENCY] that is based on, arising from, or related to Employee’s employment at [AGENCY] or the deferred resignation offer, including any and all claims that were or could have been brought concerning said matters. This waiver includes all claims Employee may have under the Age Discrimination in Employment Act. Employee unconditionally releases [AGENCY] and its present and former employees, officers, agents, representatives, and all persons acting by, through, or in concert with any of those individuals, either in their official or individual capacities, from any and all liability based on, arising from, or relating to the matters that Employee may have against them, including any and all claims that were or could have been brought. Consistent with applicable law, Employee similarly waives any claim that could be brought on Employee’s behalf by another entity, including Employee’s labor union.

Section 13 makes the contract effectively meaningless. If the government violates its terms, federal employees are powerless to do anything about it. Federal employees who agree to resign also waive their right to legally challenge any aspect of their employment, even for issues that are completely separate from the deferred resignation agreement. The contract also purports to prohibit a labor union from filing a grievance on a worker's behalf.

Some contracts include provisions for alternative dispute resolution to avoid formal litigation. In other cases, the parties agree to "liquidated damages" that will be paid if either party is in breach. But in this case, employees waive their right to enforce the contract in any forum. (Under the terms of the contract, the government makes no such concession.) This provision defeats the primary purpose of the contract, which is to give both parties a way to enforce an agreement.

Federal employees who accept the deferred resignation agreement can be required to work indefinitely

The contract makes clear that all employees who accept the agreement will be expected to work through February 28. This was not mentioned in previous descriptions of the offer.

After February 28, the contract states that employees who accept the offer "shall not be expected to work during the deferred resignation period except in rare circumstances as determined by" their agency. The contract does not define "rare circumstances," nor how agencies will determine whether an employee needs to continue working.

The idea that it will be "rare" for an agency to determine that it is essential for a federal employee to continue working is based on the false assumption that most federal employees are not doing important work. Agencies are not going to allow federal workers to be placed on administrative leave while food is not being inspected, parks are understaffed, and questions about Social Security benefits go unanswered.

The memo accompanying the contract says it is expected that "most employees will transition their duties and be placed on administrative leave for the bulk of the deferred resignation period." This is an acknowledgment that an unknown percentage of employees who accept the agreement will continue to work. The decision to place an employee on administrative leave, according to the memo, remains with the agency.

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Agencies can rescind the deferred resignation at their sole discretion

The new OPM memo states that "[w]ere the government to backtrack on its commitments, an employee would be entitled to request a rescission of his or her resignation." It is unclear how this would happen, since the government is not committing to do anything in particular, other than exempt workers who agreed to deferred resignation from return-to-office policies.

But Section 10 of the agreement makes clear that "this agreement cannot be rescinded, except in the sole discretion of the [AGENCY HEAD], which shall not be subject to review at the Merit Systems Protection Board (MSPB) or any other forum, and waives all rights to challenge the resignation before the MSPB or any other forum." So a federal employee could "request a rescission," but there is no obligation under the contract for the agency to agree to that request.