Official White House Photo by Pete Souza

Obama Issues Plan to Give Feds 1.3 Percent Raise in 2016

Proposal would lift locality pay for first time in six years.

President Obama issued an alternative pay plan late Friday, setting an across-the-board increase for civilian federal employees of 1.3 percent in 2016.

The figure matches the amount the president requested in his fiscal 2016 budget proposal. Obama issued a separate plan providing a 1.3 percent boost in monthly basic pay rates for military service members.

The civilian raise will come in two forms. On Friday, Obama authorized a 1 percent across-the-board raise. In November, the president said he will issue an alternative plan for locality pay rates that will bring the aggregate increases to 1.3 percent.

“The 1.0 percent across-the-board base pay increase for civilian employees is the first step toward implementing an aggregate 1.3 percent increase as proposed earlier this year and included in the president’s FY 2016 budget,” a spokeswoman for the Office of Management and Budget told Government Executive. “The remaining increase in civilian pay will come in the form of locality adjustments across all pay areas.”

The National Treasury Employees Union said the 1 percent across-the-board raise will be coupled with a 0.3 percent locality pay bump. Locality pay has been frozen since 2010.

Obama said that his pay proposal “will not materially affect the federal government's ability to attract and retain a well-qualified federal workforce.”

NTEU President Tony Reardon took issue with that claim.

“NTEU will continue to push for a more meaningful raise for the federal workforce,” Reardon said, “one that would help the government stay competitive with private-sector employers and help employees cope with rising costs for everything from housing to tuition to food. Fair pay will be one of my key priorities in the coming year.”

If the president had not informed Congress of his alternative pay plan for feds by the end of August, then the increase mandated by the 1990 Federal Employees Pay Comparability Act would have kicked in. Under FEPCA, the raise would be determined by the change in the Employment Cost Index minus 0.5 percent.

Presidents largely have ignored the FEPCA formula in their federal pay raise proposals, preferring to offer their own figure. Congress created FEPCA, which provides an annual across-the-board salary boost and a locality pay adjustment for General Schedule employees, to close the public and private sector pay gap. The Federal Salary Council has said that federal employees are underpaid relative to private sector workers by approximately 34.6 percent.

The reality, however, is that Congress will end up determining whether federal employees receive a pay raise next year. So far, lawmakers have remained mum on the issue. Unless Congress proactively alters the proposal, Obama’s 1.3 percent recommendation will become law.

Unlike last year, Obama did not indicate he would have given civilian employees a higher raise if economic conditions were improved. He did mention that for the military, however.

“As our country continues to recover from serious economic conditions affecting the general welfare, however, we must maintain efforts to keep our nation on a sustainable fiscal course,” Obama wrote in his order to Congress. “This effort requires tough choices, especially in light of budget constraints.”

The House has approved a 2.3 percent pay raise for members of the military in 2016, who also received a 1 percent raise in 2014 and 2015. Senate bills setting military pay, however, support a 1.3 percent raise for troops in 2016 -- the same as Obama’s proposal.

Raises for both the military and civilian workforces will go into effect Jan. 1, 2016. 

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