Obama issues order implementing pay freeze

President Obama on Wednesday evening issued an executive order making official the two-year pay freeze he proposed in late November and Congress approved Tuesday night.

The freeze will apply to all civilian employees, including those at the Defense Department and at agencies with alternative pay systems. Senior executives will not be eligible for base salary increases either, including those linked to job performance. And locality pay will remain at 2010 levels. Workers still will qualify for promotions and step increases.

In a memorandum accompanying the order, Obama acknowledged that certain laws allow agency heads the "administrative discretion" to adjust pay schedules on their own initiative. He said such officials "should not provide any upward adjustments in federal employees' pay schedules or rates during the two-year period covered by the statutory pay freeze." Obama said the freeze was necessary, but noted it could be difficult for employees to swallow.

"Federal workers are not just a line in a budget," he wrote in his memo. "They are public servants who, like their private sector counterparts, may be struggling in these difficult economic times. Despite the sacrifices that I knew a pay freeze would entail for our dedicated civil servants, I concluded that a two-year freeze … is a necessary first step in our effort to address the challenge of our fiscal reality."

Washington-area lawmakers had asked their colleagues to consider the pay raise on an annual basis and in the larger context of deficit reduction efforts, but Congress nonetheless approved language holding civilians' salaries steady for two years, as part of the continuing resolution passed Tuesday night. The stopgap funding measure will keep government running until March 4.

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