Defense Payroll Agency Begins Furloughs

Defense furloughs will not delay the paychecks of millions of military, civilian and retired employees, according to the service that administers payroll to department personnel and contractors.

Most of the 12,000 employees at the Defense Finance and Accounting Service started their summer-long furloughs this week; affected employees are subject to unpaid leave for up to 11 days through Sept. 30. Thomas LaRock, deputy director of corporate communications at DFAS, said the agency “will continue to make payroll on time and accurately,” for military, civilian and retired workers. LaRock cautioned, however, that delays could occur for other types of payments, including those to contractors. “There is the potential that pay to vendors and travelers could be delayed under a furlough in some cases, but DFAS leadership is working to make sure all vital activities continue in their normal time frames to the maximum extent possible,” LaRock wrote in an email.

DFAS pays all Defense military and civilian personnel and retirees as well as major Defense contractors. DFAS is also responsible for the payroll of the Executive Office of the President; the Environmental Protection Agency; the Energy, Health and Human Services, and Veterans Affairs departments; and the Broadcasting Board of Governors. The service, operated as a working capital fund, processed pay for 6.6 million people in fiscal 2012. Working capital fund entities make revenue by charging customers, and do not receive direct funding from Congress.

The agency has nine sites: Indianapolis; Columbus, Ohio; Cleveland; Rome, N.Y.; Limestone, Maine; Texarkana, Texas; Alexandria, Va.; and two overseas locations in Europe and Japan. Employees at all locations, with the exception of a few hundred who are either deployed to a combat zone, non-appropriated fund employees or foreign national workers, are subject to furlough. DFAS noted on its website that budget cuts and sequestration will result in reduced staffing and office hours.

The New Orleans-based National Finance Center, which processes payroll for 650,000 other federal workers, is not furloughing any employees. The Agriculture Department runs the NFC; the department announced in May it would not furlough any employees through the end of fiscal 2013. The National Finance Center also has facilities in Denver and St. Louis.