Pay and Benefits Watch 1998 Recap

PAY AND LEAVE CHANGES

Tucked into various last-minute bills this congressional session were various provisions affecting pay and leave for federal employees. Provisions affect annual leave for Panama Canal employees, back pay awards, holidays for employees stationed overseas, Sunday premium pay, firefighter pay, and annual leave for senior executives, among other issues. For a run-down of 1998 pay and leave changes, click here to read an Office of Personnel Management memorandum.

PAY RAISE

President Clinton has approved a 3.6 percent pay raise for federal employees and military personnel in 1999. The Office of Personnel Management released the 1999 pay tables, including locality pay. Click here to find out how much you're going to make in 1999. Look forward to a 4.4 percent raise in 2000. That's how much Clinton has already proposed for next year's raise.

EXECUTIVE PAY

While top-tier Senior Executive Service members will not get a raise in 1999, they will be eligible for bigger bonuses, under a provision included in the Treasury-Postal spending bill. The cash award that accompanies Presidential Rank Awards will also rise in 1999. Click here for more details.

BUYOUTS AND EARLY OUTS

Congress granted a few agencies buyout authority, while more agencies have early out authority, which must be approved by the Office of Personnel Management. Click here for the latest information.

THE FUTURE OF TITLE V

Title V is the section of the U.S. Code that governs civil service rules. Congress has granted a number of agencies exemption from Title V in recent years. Many human resources specialists complain that civil service rules make it harder for them to do their jobs, and are arguing for more freedom from governmentwide personnel policies. A new OPM study looks at the pay and benefits policies at Title V-exempt agencies. You may want to read it-the study could be looking at the future of the civil service.

RETIREE COLA

Federal retirees will get a 1.3 percent cost-of-living increase next year, the lowest since 1986. Low inflation has kept wages and prices down. The COLA is the same for enrollees in the Federal Employees Retirement System and the Civil Service Retirement System.

TSP PROPOSAL

A measure passed by the House Government Reform and Oversight Committee in July would allow federal employees to invest in the Thrift Savings Plan up to the annual IRS limit, which is $10,000 this year. Current rules limit TSP investments to five percent of pay for Civil Service Retirement System employees and 10 percent of pay for Federal Employees Retirement System employees, and permit new employees to begin TSP participation immediately and allow them to roll over private-sector 401(k) accounts into the TSP. The proposal has not seen any action since July.

OVERTIME PAY

A bill (H.R. 3956) sponsored by Rep. Tom Davis, R-Va., would raise the overtime pay cap for supervisors and other professionals from GS-10, Step 1 to GS-15, Step 1. A watered-down version of the bill that would raise the cap to GS-10, Step 6 over five years was included in a civil service reform package the House Civil Service Subcommittee was considering, but the measure was knocked out because it was considered too costly for agencies. Managers' associations continue to lobby for the increase, but no action is expected until next year.

HEALTH INSURANCE PREMIUMS

Federal employees' health insurance premiums will rise an average of 10.2 percent in 1999, costing the average employee about $88 more over the course of the year than in 1998. In addition, 65 health plans are dropping out of the Federal Employees Health Benefits Program. Congress has questioned the rising rates.

CONTRACEPTIVE COVERAGE

The 1999 Treasury-Postal appropriations bill included a measure requiring federal employees' health insurance carriers to provide prescription contraceptive coverage. The measure was tossed out amid protests from House conservatives. but then got a second life. It is now part of the omnibus spending bill. The Office of Personnel Management will require federal health plans to cover five types of prescription contraceptives: : birth control pills, diaphragm, IUDs, Norplant and Depo-Provera. Five plans with religious affiliations are exempt from the provision, as are doctors who object to contraceptives.

LIFE INSURANCE

The Federal Employees Life Insurance Improvement Act, H.R. 2675, which Congress has approved, will allow retirees to continue paying premiums after age 65, avoiding a phase-out of coverage. The act also instructs the Office of Personnel Management to study additional life insurance options for federal employees.

SPECIAL PAY RATES

Congress approved special pay deals for federal firefighters, physicians and State Department diplomatic security agents. Firefighters received a 10 percent pay raise effective Oct. 1, 1998 and will receive more overtime pay. Agencies will be able to offer more money to recruit and retain physicians. The State Department agents will receive better benefits.

CIVIL SERVICE REFORM

Once again this year, civil service reform bit the dust amid disagreements among the administration, Congress, and employee unions. The House Civil Service Subcommittee had been considering a bill filled with 40 proposals for changing the way the government manages its employees. Measures included prohibiting people with drug convictions from working for the federal government, allowing managers to deny automatic within-grade increases to employees, removing the right of employees to protest denials of within-grade increases to the Merit Systems Protection Board and prohibiting new pass-fail performance evaluation systems. That bill died in July, reduced to a proposal to raise the limit on TSP contributions. Meanwhile, the Office of Personnel Management and the Defense Department are planning proposals for civil service reform, but work has slowed on the proposals until the next legislative session.

RETIREMENT FIX

The House has passed a bill (H.R. 3249) that would correct retirement plan snafus for thousands of civil servants. But the Senate failed to take up the bill, so thousands of employees will have to wait until next year for a solution.

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