The federal government is implementing major workforce changes in 2025 that will reshape the civil service landscape. Two transformative policies are leading these changes: the reinstatement of Schedule F, which enables reclassifying career positions as political appointments, and the wholesale elimination of DEI programs across federal agencies. Understanding how these changes affect your severance benefits is essential for the thousands of employees potentially impacted. We've assembled this guide to help you navigate your options and understand what to expect.

Federal Government Layoffs 2025: Latest Developments

On January 20, President Trump brought back Schedule F through executive order, fundamentally altering how career civil service positions can be filled and terminated. This executive order allows for the reclassification of thousands of federal employees as political appointees, effectively removing traditional civil service protections. The change particularly affects positions involved in policy-making, including senior executive service members and GS-13 through GS-15 positions.

The National Treasury Employees Union quickly filed a lawsuit challenging the administration, arguing that applying political appointment rules to career staff positions violates established civil service laws. NTEU President Doreen Greenwald emphasized that this move threatens the foundation of professional, nonpartisan government service.

In a parallel development, all federal DEI employees have been placed on immediate administrative leave with suspended email access. This marks the first step in a broader initiative to eliminate DEI programs across federal agencies. The administration's comprehensive restructuring plan could potentially affect up to one million federal positions, representing the largest reorganization of federal workforce in modern history.

Previous US Federal Severance Package Breakdown

Understanding historical severance practices provides crucial context for what to expect in 2025. Here's a detailed examination of federal severance structures:

Core Financial Benefits

The government employs a standardized formula for calculating severance, designed to account for both length of service and age:

• Basic Severance Allowance
  • First 10 years: 1 week of base pay per year of service
  • Beyond 10 years: 2 weeks of base pay per year
  • Additional credit: 25% more for each full 3 months beyond your last complete year
  • Example: An employee with 12 years and 6 months of service would receive:
    • First 10 years: 10 weeks
    • Next 2 years: 4 weeks
    • Extra 6 months: 0.5 weeks
    • Total: 14.5 weeks of base pay
• Age Adjustments
  • 2.5% increase for every 3 months over age 40
  • This can significantly increase total severance for older employees
  • Example: A 45-year-old employee would receive an additional 25% (20 quarters × 2.5%)
• Maximum Benefits
  • Total severance capped at 52 weeks of base pay
  • Previous severance payments count against this lifetime cap
  • Regular bonuses and additional pay aren't included in calculations

Extended Benefits Package

1. Health Insurance Coverage
   • FEHB coverage continues up to 18 months post-separation
   • Employee responsible for both portions of premium
   • 2% administrative fee added to total cost
   • No waiting period or qualification requirements for continuation
   • Option to change plans during open enrollment while on continuation
2. Life Insurance Protection
   • FEGLI coverage extends 31 days after separation
   • No premium during 31-day extension
   • Conversion to individual policy available
   • No medical examination required for conversion
   • Must apply for conversion within 31-day window
3. Leave and Incentive Programs
   • Full payout for accumulated annual leave at current rate
   • Sick leave hours banked for potential future federal service
   • Voluntary Separation Incentive Payments (VSIP) up to $25,000
   • VSIP acceptance may affect future federal employment eligibility
   • Special provisions for unused compensatory time

Key Exclusions and Special Cases

Several situations can affect or eliminate severance eligibility:

• Terminations for misconduct or performance
• Declining reasonable alternative positions
• Political appointee positions
• Temporary or term appointments
• Retirement-eligible employees
• Employees with immediate annuity eligibility

Severance Comparison: US Federal Government vs. International Counterparts

How do U.S. federal severance benefits compare internationally? Here's a comprehensive analysis:

Canada

• Severance potential up to 24 months' pay
• Factors considered:
  • Age at termination
  • Position level
  • Years of service
  • Market conditions
  • Reemployment probability
• Pension considerations:
  • Continued accrual during notice
  • Option for continued contributions
• Provincial variations in requirements
• Strong union influence on terms

United Kingdom

• Statutory Redundancy Pay structure:
  • Under 22: Half week per year
  • 22-40: One week per year
  • Over 41: One and a half weeks per year
• Weekly pay caps apply (currently £544)
• Maximum statutory payment: £16,320
• Notice period requirements:
  • 1 week for 1 month to 2 years service
  • 1 week per year up to 12 weeks maximum
• Consultation requirements:
  • Individual consultation required
  • Collective consultation for 20+ redundancies
• Additional benefits often negotiated

Australia

• Clear National Employment Standards (NES) progression based on service:
  • 1-2 years: 4 weeks
  • 2-3 years: 6 weeks
  • 3-4 years: 7 weeks
  • Continues up to 16 weeks for 9-10 years
• Notice periods vary by age and service
• Guaranteed leave payouts
• Strong protections for long-term employees
• Additional benefits for older workers

Germany

• No statutory severance requirement
• Common practice ranges:
  • 1-2 months per service year
  • Typically capped at 12-18 months
• Extensive notice periods:
  • 4 weeks minimum
  • Up to 7 months for 20+ years service
• Works council influence:
  • Mandatory consultation
  • Social plan negotiations
  • Additional benefits common
• Special protections for older workers

What to Expect from US Federal Government Severance Packages in 2025

Based on current policies and historical patterns, US federal employees facing layoffs should anticipate:

Financial Package

• Continuation of standard tenure-based calculations
• Age adjustments for employees over 40
• Maintenance of 52-week maximum payout
• Normal leave payout processing
• Potential VSIP offerings in some cases

Healthcare Continuation

• 18-month FEHB eligibility unchanged
• Same premium structure and administrative fee
• Standard conversion options
• Possible premium subsidies in certain cases

Additional Support

• Standard life insurance extension
• Career transition services
• Outplacement assistance
• Resume and job search support
• Special provisions for security clearance holders

Making the Most of Your Package

While awaiting official announcements, take these key steps:

1. Submit and review severance data in our comparison library
2. Document your service time and calculate potential benefits
3. Research healthcare continuation costs
4. Share your offer details to help others maximize their packages

Looking Ahead

The federal workforce faces unprecedented changes in 2025, but data sharing can help everyone navigate these transitions more effectively. While we await formal severance announcements, you can prepare by reviewing past severance data in our comparison library. Every shared package strengthens our collective understanding of federal benefits.

If you receive a severance offer, consider submitting your details. Your information could help thousands of colleagues make better-informed decisions. For specific questions about your situation, consult an employment attorney who specializes in federal employment law.

Together, we can build a clearer picture of severance benefits and support each other through these changes. Stay informed, know your rights, and remember that your experience matters - both for your own journey and for helping others navigate theirs successfully.