Navy error upends pay for more than 1,200 retirees
After decades of military service, retired Navy Cmdr. Stephanie Murdock went to check her retiree pay statement in early April and was shocked to find that she was going to be receiving $1,118 less each month.
The cut troubled Murdock, but perhaps not as much as the lack of explanation from the Navy or the Defense Finance Accounting Service, which processes military and retiree pay based on information provided by the services.
“That’s not okay,” she told Navy Times. “You don’t get to lower my pay and eventually tell me why.”
Murdock, who retired in July 2022, nosed around DFAS’s self-help sections to try and figure it out early last month.
Eventually, she found her answer: The Navy had incorrectly calculated her service time and sent the wrong information to DFAS, resulting in the abrupt pay cut she now faces.
Murdock isn’t alone. Navy officials confirmed that “a software issue” resulted in incorrect service time calculations for 1,283 Navy retirees, errors that span from August 2019 to this past February.
Navy Personnel Command spokesman Lt. Cmdr. Rick Chernitzer attributed the retiree pay error to “a software issue” that has since been fixed.
“There have been no more reported issues with the data since that time,” he said.
Officials said the issue popped up on the Navy’s radar in November, when a retiree reported an overpayment.
“The Navy provided preliminary notification of an error and (DFAS) is also contacting those affected retirees and members of the Fleet Reserve, notifying them of the overpayment and corrective measures underway to correct their retirement or retainer pay,” Chernitzer said in an email to Navy Times.
As of Monday, a month after her initial shock at the decrease, Murdock said she had not been contacted by DFAS.
Officials said affected retirees can learn more about debt waiver options by going to this link.
At this point, after receiving two Navy letters but zero information as to what happened, how much she might owe or how she can dispute an error that is not her fault, Murdock said she has lost trust in the Navy.
The software issue at blame fell within the Navy’s Standard Integrated Personnel Systems, or NSIPS.
NSIPS is also to blame for the Navy prematurely awarding four years of service credit to 160 Navy doctors and dentists, a mistake that allowed 95 of those members to retire after just 16 years of service instead of the required 20 years.
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That issue stemmed from NSIPS incorrectly tabulating the four years of military-provided medical school in those officers’ time in service.
As a result of that “data migration error,” the other 65 medical officers saw their retirements pushed back several years because the four years of medical school does not count toward the 20 years required for retirement, even though those officers will be credited with 24 years in service when they get out, according to Chernitzer.
While both errors are attributed to NSIPS, Chernitzer said the retiree pay issue being suffered by Murdock, and the issue that led to the Navy medical officers seeing their service time incorrectly tabulated, are not connected.
NBC first reported the medical officer issue last week.
Officials did not answer questions by deadline Monday regarding why NSIPS is causing such disruptions.
But Chernitzer said last week that the NSIPS issues do not fall under the Navy’s so-called “HR Transformation” program, a sprawling, years-long, $1.6 billion effort to modernize Navy pay and administrative records that have disrupted pay and entitlements for thousands of sailors in recent years.
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Either way, the NSIPS missteps suggest further struggles as the sea service works to modernize pay and personnel systems.
News of the retiree pay snafu follows reports last week that Army Human Resources Command errors led to at least 190 active duty pilots voluntarily resigning years ahead of schedule because of missteps in how the command tracked and applied their commitments.
A matter of trust
The retiree pay cut is just the latest Navy-related pay and personnel issue to afflict Murdock.
Like thousands of other sailors, she faced long delays getting her DD-214 discharge paperwork last summer, a problem exacerbated by HR Transformation.
“I just don’t believe that the Navy isn’t going to keep doing this,” she said of the litany of problems inflicted on her and others from above. “They haven’t shown me they can be trusted with my career record, my pay or my retirement.”
Murdock also said the retiree pay adjustment has upended her carefully calibrated retirement plans.
Moreover, such problems leave retirees like Murdock in the lurch and unclear of what their options are going forward.
A former Navy public affairs officer, Murdock said she tried calling DFAS early last month and was told, “We’re getting a lot of calls from (Navy retirees) and we don’t know why.”
She acknowledges that she had an unorthodox career path to calculate, which involved four years in the Marine Corps, then time as a Navy Reservist and then full-time active duty status.
But Murdock said she worked hard to make sure her record was squared away and described the pay problem as “typical military.”
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She doesn’t think she should have to pay for the Navy’s mistake, but she expects to be told she will have to pay back the overpayment, potentially with interest.
“It’s ridiculous that they could be so inept and then so callous on top of that,” Murdock said. “Like, you should pay for our mistake.”
Murdock said she worries about more junior personnel having to deal with such indebtedness as well and “is resigned to the fact that I’ll probably be fighting the Navy for the next six months, minimum, to unscrew these issues.”
She wants a deep audit of how her active duty and reserve service is calculated but doesn’t trust the Navy to get it right.
In fact, she doesn’t even know where to start on that front, she said.
“I don’t believe (Navy Personnel Command) has anybody who can actually do this correctly, and I will never trust that this isn’t going to happen again,” she said.