To amend section 1174 of title 10, United States Code, to provide separation pay for regular enlisted members of the Armed Forces who are involuntarily discharged or released or are denied reenlistment.

Authorizes the payment of separation pay to a regular enlisted member of an armed force who is discharged or released from such armed force (except by sentence of a court martial) if: (1) the member completed more than five but less than 20 years of active service immediately before such discharge or release; and (2) the discharge or release is involuntary or the result of denial of reenlistment. Requires members so discharged or released to receive such pay unless the Secretary of the military department concerned determines that the conditions of the release or discharge do not warrant payment of separation pay.