In an office memorandum dated October 11, 2024, the Department of Pension and Pensioners’ Welfare (DoP&PW) has introduced new guidelines enabling Central Government employees covered under the National Pension System (NPS) to opt for voluntary retirement.

According to the memorandum, “The rule provides that at any time after a central government employee covered under NPS has completed twenty years’ regular service, he may, by giving notice of not less than three months in writing to the appointing authority, retire from service,” the memorandum read.” 

The new rule says that employees who have served for at 20 years or more can choose to retire. To do so, they need to submit a written notice to the appointing authority at least three months prior. The retirement will take effect if the request is not declined once the notice period ends. 

Also, if the employee wants to retire with less than three months' notice, they can request so in writing. This will be considered by the appointment authority and may be granted if there are no administrative difficulties. 

Further, once an employee gives their notice, they cannot withdraw it unless they get special approval from the authority. For such withdrawal, they must request at least 15 days before the retirement date that they had planned. 

With these new guidelines, the Central Government employees get more options and can plan their retirement in a more flexible manner. 

What is more, when employees retire voluntarily, they will receive benefits according to the Pension Fund Regulatory and Development Authority (PFRDA) rules. In fact, they will be treated similarly to employees who retire at the regular retirement on superannuation age and can access the same benefits. 

The employee may also choose to continue his individual pension account to defer payment of benefits beyond the date of retirement. In such a scenario, he can exercise this option according to the Pension Fund Regulatory and Development Authority (Exits and Withdrawals under National Pension System) Regulations, 2015.