Obama extends pay freeze until Congress passes a budget

President Obama on Tuesday said he would use his authority to give federal employees an across-the-board 0.5 percent pay raise in 2013, but the increase will not take effect until Congress passes a budget.

Lawmakers anticipate passing a six-month continuing resolution when they return from August recess to fund the government through the first part of fiscal 2013. That means a pay raise for federal workers would not take effect until April, at the earliest.

"With respect to the anticipated continuing resolution, Congress should maintain current pay rates during the period of the continuing resolution," Obama said in a letter to lawmakers. "Assuming such a continuing resolution is enacted, the adjustments described above would take effect after the continuing resolution expires."

Locality pay will remain at the current levels, Obama told lawmakers.

The president said his decision would not "materially affect the federal government's ability to attract and retain a well-qualified federal workforce."

The American Federation of Government Employees called the president's decision to extend the two-year pay freeze until Congress passes a budget "unwarranted and unjustified." J. David Cox, the newly elected AFGE president, criticized the decision in a statement.

"The well is dry, Mr. President," Cox said. "Federal employees cannot afford another four months or even another day of frozen wages."

Lawmakers so far have remained silent on the matter of a 2013 pay raise, opening the door for Obama to use his authority under the 1990 Federal Employees Pay Comparability Act to set an increase, or allow the automatic adjustment under that law to take effect. For 2013, that automatic adjustment would be 1.2 percent for federal employees. Obama instead opted for the lower increase.

"I view the adjustments that would otherwise take effect as inappropriate," the president said in his letter.