Expert: Cynthia Bedell - 1/18/2008

Question
I'm a US Army active duty soldier with 9 years of service, 8 of which I served from 82-90.  I re-enlisted on 4/07 but got injured during Warrior Training Course and found to have Osteoarthritis in the L hip.  I was found unfit for duty after an MEB and I'm being honorably discharged with severance pay.  During my first enlistment I achieved the grade of E-5, but took a 1 grade demotion to come back in.  My question:  if the Army is going to pay me severance pay for my discharge, shouldn't it be at the highest grade successfully attained through my Army career?  At the finance office I'm being told that severance pay will be awarded as an E-4 with 9 years.  I was told at the WTU unit I'm in that it should be paid at the highest grade I held while in the military.  Which is correct?  Thxs for Ur time.

Answer
Dear Wilfredo --

Your severance should be based on the formula for retirement under your most recent enlistment terms, and your highest pay years.  You may find that E-5 in 1990 made far less than the E-4 pay you are getting now.

The actual rank finance uses is irrelevant since they should be basing your severance pay on a "high-three" (averaging your highest three years of pay to determine your pay floor) or a "high-five" retirement pay base, offset by the fact you get credit for only 9 years, rather than 20 years.

Your rank would only matter if you were getting a medical retirement because then your basis of retirement is determined by the highest rank achieved.  

Please write back, if anything I've discussed is not clear, or you have additional questions.

Best of luck to you.