The Department of Pension and Pensioners’ Welfare (DoPPW) has released guidance regarding the voluntary retirement regulations within the Unified Pension Scheme (UPS) for central government employees. As the deadline of November 30, 2025, approaches for transitioning to UPS under the National Pension System (NPS), the government aims to provide clear instructions to eliminate confusion.
The recent circular specifically addresses the eligibility criteria for voluntary retirement, the mandatory notice period, the possibility of reversing the decision, and the methodology for calculating pension benefits.
According to Rule 13 of the UPS guidelines, central government employees with at least 20 years of continuous service can apply for voluntary retirement (VRS) under NPS. It is important to note that VRS under UPS is only applicable to individuals who have chosen the UPS option within NPS, requiring a minimum service tenure of 20 years.
Employees interested in VRS must submit a written notice to the appointing authority at least three months in advance. Nevertheless, there is flexibility as the appointing authority has the discretion to reduce the notice period if early retirement does not disrupt operations or create administrative challenges, with such decisions being made on a case-by-case basis.
If the appointing authority does not decline the notice within the stipulated three-month period, the retirement request is automatically considered approved, and the employee will retire on the specified date. Once the notice period expires without objection, no additional clearance is necessary.
While employees can change their decision after submitting a VRS request, they must obtain approval to do so. The DoPPW regulations dictate that employees cannot retract their VRS application independently and must secure written consent from the appointing authority. Moreover, any request to withdraw the retirement notice must be made at least 15 days before the planned retirement date.
Certain categories of employees are not covered by the UPS-VRS rules, such as those retiring under the special VRS scheme for surplus staff introduced by the Department of Personnel and Training (DoPT), as well as government employees resigning to join autonomous bodies or public sector units (PSUs).
Pension calculations post VRS under UPS are based on the total years of service completed. Employees with less than 25 years of service will receive a pro rata assured pension, while those with 25 years or more of service are entitled to full assured pension benefits under the UPS framework.
In essence, the updated guidelines aim to provide clarity and facilitate better retirement planning by ensuring that eligible employees comprehend their entitlements, timelines, and benefits under UPS.