A 'Measly' Pay Raise Is the Least of Feds' Worries

Contributing more for pensions and the threat of governmentwide automatic spending cuts are bigger issues.

Most of you have heard the news by now that President Obama will extend the current federal pay freeze until Congress passes a budget for the next fiscal year. If you’re not aware of this latest twist in the federal pay drama, then I envy you, because it means you are probably lying on a beach somewhere enjoying the last remnants of summer.

To briefly recap, the president announced Tuesday evening that he is using his authority under the law to give federal employees a 0.5 percent pay boost in 2013. But the across-the-board salary increase is contingent upon Congress accomplishing what it is apparently incapable of these days: agreeing on a long-term spending plan to fund the government. Lawmakers are on track to pass a six-month continuing resolution when they return from recess, which means that feds will have to wait until at least April for a pay increase. Of course, government workers might have to wait longer than that if lawmakers push through another stopgap spending measure after the first one expires.

So, what does this mean to federal employees? It depends on your perspective. Federal employee unions range from apoplectic to disappointed over Obama’s decision, but based on comments from Government Executive readers, many feds are just, well, resigned almost to the point of indifference. Some see the promise of a 0.5 percent pay raise -- whenever it might come -- as an empty-handed political gesture that isn’t very useful.

“Who cares...does a measly 0.5 percent matter, anyway?” asks one reader. “What does that come to for an average fed, about 50 bucks a month after taxes? Is that really going to break your bank?” Actually, it’s probably less than $50 per month extra for the average fed, but we’re splitting hairs. From another reader: “Don't really care myself, 0.5 percent does not do a great deal for me. Just keep it.” Maybe Obama should just keep it. It doesn’t sound like it’s garnering him much political capital among federal workers, anyway.

Looming Threats

The question of a 0.5 percent pay increase versus an extended freeze is kind of small potatoes compared to the other potential threats feds currently face. Obama and many Republicans, including presidential rival Mitt Romney, favor increasing the amount of money federal workers contribute to their pensions. Obama recommends feds contribute 1.2 percent extra to their retirement benefits, while many lawmakers want government workers to shell out more. Under a deal Congress approved in February, federal employees hired after Dec. 31, 2012, have to pay 2.3 percent more toward their government pensions.

And then there is the matter of the automatic spending cuts, known as sequestration, scheduled to begin in January 2013. If Congress can’t figure out a way to avoid those governmentwide, across-the-board reductions, federal jobs, not to mention contractor jobs, are very much in jeopardy. The good news for federal employees, such that there is some: their health care and retirement benefits are protected from cuts if the sequester happens, and their pay cannot be reduced to save money. But if agencies have to furlough or lay off employees, all bets are off. Feds don’t necessarily get paid if they are furloughed (Congress decides whether to grant back pay), and if you lose your job, obviously, you lose your pay and benefits.


TRICARE beneficiaries who enrolled in the US Family Health Plan after Aug. 20, 2012, cannot stay in that program after they turn 65.

Those beneficiaries 65 and older who enroll after that date will lose their eligibility for USFHP and move into TRICARE for Life, according to the Defense Department. USFHP is a managed care TRICARE Prime option. Those enrolled in the program before Aug. 20 can stay in the program, regardless of age, until they no longer qualify for TRICARE coverage.

In addition, USFHP enrollment remains open for the following groups: eligible active-duty family members; qualifying surviving children and spouses who have not yet remarried; unmarried children up to age 21, or up to age 23 for full-time students; retirees and their family members under the age of 65; and former adult dependent children whose sponsor’s status qualifies them for TRICARE Young Adult coverage.

Military Duty Protection

Employees of the Transportation Security Administration now officially are protected under a law that prohibits employers from discriminating on the basis of military service. President Obama on Aug. 16 signed into law a bill that makes TSA subject to the requirements of the 1994 Uniformed Services Employment and Reemployment Rights Act. The law protects individuals’ rights to be reemployed when they return from uniformed military service, including those in the reserves and the National Guard called to active duty. According to TSA, the agency’s existing policies regarding employees who leave for uniformed service already are consistent with USERRA.