The Office of Personnel Management has finished writing paid leave for deferred resignation programs into federal regulations, giving agencies what it calls a firmer legal foundation for the incentive the Trump administration used to shrink the government's workforce last year. The final rule on administrative leave was released Friday, is scheduled to appear in Monday's Federal Register and takes effect Nov. 18.
The centerpiece is a new entry on the regulation's list of acceptable uses of administrative leave. Employees who sign a written agreement to leave on a specified future date may be kept on paid leave in the meantime, an arrangement the rule calls a transition-to-separation tool for restructuring efforts, including deferred resignation programs, voluntary separation incentive payments and voluntary early retirement. That leave remains subject to limits OPM sets for the whole government and to any limits an agency adds.
OPM says that beginning in calendar year 2026, leave tied to workforce realignment has been limited to 12 weeks per instance unless OPM and the Office of Management and Budget jointly approve a higher threshold, and that a six-month threshold was later approved for restructuring-related resignation agreements that took effect in fiscal 2026. Government Executive reported last month that OPM's current guidance for agencies weighing a deferred resignation offer caps the paid leave at 12 weeks.
The rule also changes what happens when a departing employee has second thoughts. Under the revised resignation regulation, whether to accept a request to withdraw a resignation before it takes effect rests in the agency's "sole and exclusive discretion," and an employee's acceptance of deferred resignation benefits, such as paid leave, joins the list of valid reasons to refuse. An agency still needs a valid reason and must explain it to the employee, and it still cannot cite the avoidance of adverse action proceedings as that reason.
Bloomberg Law reported that the rule codifies a 2025 OPM memo allowing deferred resignation incentives and leaves room for another offer like the "Fork in the Road" program, which traded several months of paid leave for resignations. About 317,000 federal workers left their jobs in the first year of President Donald Trump's second term through layoffs and the voluntary resignation program, the outlet reported.
The rule reaches beyond resignations. Agencies may, but are not required to, keep employees on administrative leave between a reduction-in-force notice and the separation date when they decide that serves the government's best interests, although employees are still expected to stay on duty under ordinary circumstances. OPM wrote that nothing in the rule authorizes an agency to bypass reduction-in-force competition, retention registers or appeal rights. Another provision permits extended leave under a settlement agreement with an employee facing documented allegations of poor performance or misconduct who agrees to resign, once the agency has considered other reasonable alternatives.
It also converts an existing OPM policy into a binding ban on administrative leave for poll workers and poll observers, partisan or nonpartisan, while keeping leave that gives employees a reasonable opportunity to vote. Two labor organizations and other commenters objected, and one union called limited leave for nonpartisan poll service an important, pro-democracy policy choice. OPM responded that the ban does not stop anyone from serving at the polls and settles only whether that service is subsidized with paid leave from federal duty. After mostly favorable comments, the agency added physical fitness activities as an example of an acceptable use.
OPM defends the approach on cost. It calculates that deferred resignation separations in 2025 cut the federal workforce by more than 6 percent, part of a reduction of more than 12 percent between December 2024 and March 2026, and says the one-time leave costs amounted to less than 3 percent of total basic payroll while the savings from a smaller workforce recur every year. OPM Director Scott Kupor has said the program would save taxpayers $20 billion a year, according to Government Executive.
The cost has drawn scrutiny. A Government Accountability Office report described by Government Executive found that agencies spent nearly $10 billion keeping more than 100,000 employees on extended paid leave in 2025, about $6.7 billion of it for deferred resignation participants, and concluded that without better data policymakers cannot tell whether the reductions are lowering costs. OPM agreed to begin developing a dedicated leave category for workforce reductions.
OPM received 30 comments on its June proposal from individuals, one agency, two unions and three employee advocacy groups, and characterized them as mixed. Opponents argued that open-ended leave sidesteps reduction-in-force safeguards and the capped buyout and early retirement programs Congress already authorized, and one cited an estimate that the 2025 programs cost about $11.1 billion. Several commenters, including advocacy groups and a union, contended that months of leave cannot be squared with the 10-workday annual limit in the Administrative Leave Act of 2016. OPM rejected that reading, saying the limit applies when an agency places an employee on leave for investigative purposes, and declined to withdraw the rule, which it called a lawful exercise of the authority Congress gave it to define acceptable uses of administrative leave.
Because agencies have operated under parallel governmentwide policies since July 2025, OPM projects that putting them into regulation will not significantly change how much administrative leave is used. The rule carries a severability clause stating OPM's intent that the remaining provisions stay in force if a court invalidates any one of them.