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Key developments in the world of federal employee benefits: health, pay, and much more.

The Pay Game

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This week, members of Congress denied themselves an annual pay raise for the second consecutive year. The decision to forgo a $1,600 increase to their salaries in 2011 is a reflection of the government's current fiscal austerity when it comes to pay, including President Obama's proposal to give federal employees and service members a 1.4 percent raise next year. But despite the belt-tightening for both branches of government, the pay rules for executive branch employees and lawmakers are quite different.

Some of those differences are due to the nature of their work. Members of Congress enjoy long recesses, but the demands of their position mean they're on the job even when they're away from Washington. Members of both chambers earn $174,000 annually (House and Senate leaders earn more), and do not receive overtime pay. That's almost as much as senior executives at agencies with certified performance appraisal systems can make -- $179,700 annually. At agencies without such certified systems, SES pay tops out at $165,300.

But unlike senior executives, or other federal employees, Congress is guaranteed an automatic annual pay raise. How did they get that unique guarantee? They gave it to themselves, in a 1989 amendment to ethics reform legislation, in exchange for waiving their ability to accept fees for public speeches. The adoption of an annual raise formula based on the Employment Cost Index was designed to let lawmakers off the hook from having to request pay raises and then defend them.

Sen. Robert Byrd, D-W.Va., who backed the adoption of the formula in 1989, defended it in 2009 when Sen. David Vitter, R-La., tried to kill automatic pay raises. Sen. Russ Feingold, D-Wis., who introduced the Senate bill this year, also has advocated the end of automatic congressional raises. Byrd said settling the matter prevented lawmakers from grandstanding on the pay raise issue. But the claims of fiscal conservatism that accompany lawmakers' votes against their own cause celebre, and the rituals of returning pay raises to the U.S. Treasury, as Feingold does and Byrd suggested, could be interpreted as grandstanding.

Those rituals also illustrate how lawmakers treat federal employees' pay raises versus how they handle their own salaries. Debate over the fiscal 2011 budget -- and the federal pay raise -- hasn't even started yet. When it does, it will be contingent upon which lawmakers are interested in championing federal pay, and how nervous lawmakers are feeling about their job prospects as the 2010 mid-term elections heat up in the fall. And ultimately, President Obama will decide how the raise is divided between base salary increases and locality pay.

Groups that represent the 2 million federal employees waiting for news of their pay raise can lobby Congress for salary increases but have no direct control over the outcome. That lack of control makes rank-and-file federal workers much more like most Americans than members of Congress.

As Feingold says in his position statement on the issue, "Few working Americans have the power to raise their own pay. Congress should exercise that power openly, and subject to regular procedures that include debate, amendment, and a vote on the record."

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