Terminal Leave and Starting a Civilian Job: What You Can and Cannot Do

The short version

Terminal leave, also called separation leave, lets you use your accrued leave right before you separate so you do not have to sell it back. During terminal leave you are still on active duty and still getting paid, so military rules still apply to you. You can often line up and start a civilian job during this time, but federal jobs and certain conduct rules come with limits, so check with your command and free legal assistance first.

Source: Military Compensation, Department of Defense

What is terminal leave?

Terminal leave is regular, chargeable leave you take immediately before separation or retirement. Instead of selling your unused leave, you use it, which lets you draw full pay and allowances while you are off. It is granted at your command's discretion, so put in your request early and get it approved in writing.

Source: Military OneSource

Am I still on active duty during terminal leave?

Yes. Terminal leave works like regular leave, except you are not required to report back to your duty station afterward. Your separation date has not hit yet, so you remain on active duty, on the payroll, and covered by your military pay and benefits until that date. That also means you are still bound by military regulations while you are out.

Source: Military Compensation, Department of Defense

Can I start a civilian job while on terminal leave?

Many members do, but do it with your eyes open. Because you are still on active duty, military conduct and ethics rules still apply, and your command can weigh in. Starting a federal civilian job while drawing military pay can raise dual-compensation and appointment issues, so that path needs a closer look. Before you accept anything, talk to your command and a free military legal assistance attorney.

Source: DoD Instruction 1327.06

What is PTDY, and who qualifies?

Permissive Temporary Duty (PTDY) is time off to hunt for a post-separation job or housing, and it does not charge against your leave balance. It is aimed at members being involuntarily separated under honorable conditions or retiring, who may receive up to 30 days of leave or transition PTDY up to 10 days. Members leaving at a normal end of term (ETS or EAOS) are generally not eligible for PTDY.

Source: Military Compensation, Department of Defense

Should I take terminal leave or sell my leave back?

You have three basic choices for extra leave at transition: use it before you go, sell it back, or take terminal leave. Terminal leave pays your full rate, including allowances, while you are off. Selling leave back pays only your base pay rate, with no allowances, and you can sell back a maximum of 60 days over your entire career. Run the numbers both ways before you decide.

Source: Military Compensation, Department of Defense

Is terminal leave paid?

Yes. You draw your normal active-duty pay and allowances during terminal leave because you have not separated yet.

Can I earn civilian pay and military pay at the same time?

For most private-sector jobs, members can. Federal civilian jobs are different and can trigger dual-compensation limits, so get legal advice before you start one.

How many days of leave can I sell back?

Up to 60 days over your whole career, paid at your base pay rate only. Allowances are not included in a sell-back.

Who gets PTDY for job hunting?

Generally members being involuntarily separated under honorable conditions or retiring. Members hitting a normal ETS or EAOS usually do not qualify.

Does my command have to approve terminal leave?

Yes. It is granted at command discretion and can be limited if it interferes with the mission, so request it early.

Does terminal leave change my separation date?

No. Your separation date stays fixed. Terminal leave runs up to that date; it does not push it back.

Where to get help

• Your unit S-1 or personnel office for leave and separation dates.
• Your installation legal assistance office for free advice on outside and federal employment.
• Your Transition Assistance Program (TAP) office.
• Your finance office for sell-back and terminal leave pay questions.
• Military OneSource at 800-342-9647.

Verification Notes

• Rules on outside employment and federal civilian employment while on active-duty terminal leave are governed by DoD Instruction 1327.06, DoD ethics rules, and service and command policy, and can vary. Dual-compensation and appointment restrictions can apply to federal jobs. Confirm your specifics with your command and a military legal assistance attorney before you accept a job.
• PTDY day limits and eligibility are set by DoD Instruction 1327.06 and service policy and can change.
• The career limit on selling back leave is 60 days. Confirm your current leave balance on your LES.

Sources & links

• Department of Defense: Leave Benefits During Transition
• Military OneSource: Military Leave and How It Works
• DoD Instruction 1327.06: Military Leave, Liberty, and Administrative Absence

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