OPM finalises rule allowing paid leave in federal workforce cuts

The final rules, published earlier this month and effective Nov. 18, also permit paid administrative leave during reduction-in-force (RIF) notice periods and, in limited cases, for physical fitness activities, and they let agencies deny employees' requests to withdraw resignations while under a DRP. About 144,000 federal employees left their jobs through the DRP last year, when the leave category was used at unprecedented levels to pay salaries of employees who were not working in the weeks or months before their official separation.

The regulations also add several prohibitions: employees are barred in most cases from using administrative leave when sick leave can be used instead, its use for investigative purposes is limited, and the ability to take the leave while serving as poll workers or poll observers is narrowed.

OPM says the changes provide "more transparency and accountability, provide a firmer legal foundation for allowing or prohibiting certain uses of administrative leave, promote consistency across agencies, clarify the authority of agencies and reduce potential disputes." In response to criticism that the rule bypasses the ten-day annual cap Congress set in the 2016 Administrative Leave Act, OPM argued that the statute does not define all areas where the ten-day limit should apply and that Congress delegated the specifics to OPM. "The sponsors of the Administrative Leave Act were concerned about costs associated with open-ended investigations of employees and did not consider a use of administrative leave that would produce long-term cost savings by facilitating workforce reductions," OPM said.

The Government Accountability Office estimated that roughly 70% of the government's paid administrative leave spending during 2025 was tied to DRP salaries, costing more than $6.7 billion. Trump administration officials have argued the program will generate far greater savings in the long term, with OPM Director Scott Kupor claiming in a blog post that the DRP produces a more than 400% return on investment. Critics say there is no concrete evidence supporting claims of DRP cost savings and that agencies lost experienced personnel, added to remaining employees' workloads and, in some cases, faced higher costs from rehiring.

The American Federation of Government Employees wrote in public comments that OPM's “speculative claim of cost savings is contrary to publicly available data demonstrating that deferred resignation programs have led to increased costs for the federal government rather than savings.” The National Treasury Employees Union called the process “backwards,” saying the proposed rule “does not hide its overriding purpose: to legitimize policy decisions that OPM has already made.” Public Employees for Environmental Responsibility argued the changes contradict the intent of the 2016 legislation, warning that “a rule that reopens the door to months-long, effectively unchallengeable leave for employees facing a RIF reproduces the same harm Congress diagnosed and acted to end.” Robert Shriver, managing director of Democracy Forward's Civil Service Strong initiative, argued that the regulations circumvent the ten-day annual limit for workforce realignment reasons, rendering Congress's statutory limit “largely optional and meaningless.”

In a report last month, the GAO said that because of data limitations, OPM does not know the exact cost of the DRP and lacks the data needed to estimate total savings, including the cost of rehires, overtime and contractors. "Once OPM implements our recommendation to collect data on administrative leave specific to the DRP or other workforce reductions, they'll be able to calculate these costs and savings more accurately," GAO Director of Strategic Issues Dawn Locke said.