FAS staff can take 70 days' annual paid leave and holidays in each of the two years before they retire -- and are now battling to cling on to the perk.
The controversial scheme was designed to allow staff to "acclimatise" to impending retirement.
The Irish Independent has learned of the special leave allowance after management at the defunct body was forced to yield to union pressure when they tried to end the practice last month.
The failed state-training agency is being re-branded as Solas.
The impasse represents another thorn in the side of Education Minister Ruairi Quinn, whose training-sector reforms involve the transfer of hundreds of FAS staff to the new agency.
But hundreds of staff who will move to Solas are now battling to hold on to their leave/holiday entitlements.
The 1,500 staff moving to the Department of Social Protection and Vocational Education Committees are also resisting any change.
It is understood there is no scheme in existence in the rest of the public sector comparable with the generous provisions on offer at FAS.
Even union sources admit the scheme is "generous" while private sector employers said it would be completely alien to most workers.
Under the "pre-retirement leave" scheme, employees at FAS can apply for an extra 44 days off a year on top of their regular 26 days' annual leave.
This entitlement is valid for a period of two years before retirement -- meaning departing staff can enjoy a total of 140 days, or almost five months of paid leave.
Internal correspondence obtained by the Irish Independent reveals efforts were made last month by FAS management to scrap the scheme.
However, management were forced to reinstate it just weeks later. Unions took the issue to the Labour Relations Commission and have since sought a hearing at the Labour Court.
Emails from FAS's human resources department informed staff last month that no further applications for pre-retirement leave would be accepted.
It said this meant no further leave would be granted except to those approved before May 19 this year.
But it reversed this the following month. in a message on July 12, FAS said the previous instruction had been "rescinded" following a Labour Relations Commission meeting.
The row over the perk is already a stumbling block to redeployment under the Croke Park deal.
Under the €85bn bailout deal, the Government has committed to implementing a wide-ranging programme of reforms to make major savings -- including moving surplus staff to busy parts of the public sector.
The IMF and EU will be looking for proof of those savings when they return in September to monitor progress.
Employer agency IBEC last night said it was time for these types of archaic practices to be abolished.
"Schemes of this order don't exist in the private sector," said director Brendan McGinty.
"There may be instances where employers may provide support for pre-retirement courses, but generally speaking they are of very short duration.
"I don't even know what those 44 days are supposed to be for. These sort of practices do not help to inspire public confidence in the Croke Park deal to deliver the kind of changes that are necessary."
FAS said its board made a decision early this year to discontinue pre-retirement leave.
"This decision is currently the subject of a Labour Court Hearing and Fas is therefore not in a position to comment," said a spokeswoman.
SIPTU FAS branch organiser Brendan O'Brien said that the union was open to a "buyout" of the pre-retirement entitlements.
But he said the offer FAS had put on the table -- a one-off "buyout" of up to three extra days off over three years -- was not good enough.
"We're prepared to deal with the issue but if the board wants a buyout it must make a reasonable offer," he said.