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Pay, Shutdown Procedures Complicated by Impending Holidays

The Office of Management and Budget issued special guidance in preparation for a partial lapse of appropriations beginning Friday night.

The White House said Thursday that, absent congressional action to provide retroactive pay to federal workers, furloughed employees at unfunded agencies will not receive pay associated with the upcoming holidays.

The Office of Management and Budget issued special guidance for agencies to prepare for a lapse of appropriations that could begin Saturday. Congress and President Trump have until midnight Friday night to come to an agreement on how to fund the departments of Transportation, Housing and Urban Development, State, Interior, Agriculture, Treasury, Commerce, Homeland Security and Justice, as well as other independent agencies, or those entities will be forced to shut down some or all of their operations.

In the memo, OMB stated that during a shutdown, holiday-related paid time off is “cancelled” for impacted employees. That means that for furloughed employees, they will not be paid for the holiday unless Congress authorizes retroactive pay after a shutdown, as lawmakers traditionally do. Excepted workers who work on the holiday will be compensated with premium pay after a shutdown ends, but those who do not will be considered furloughed for that day.

“If the lapse is in effect on a holiday (e.g. the December 25 Christmas holiday), an excepted employee who is required to perform work on the holiday during the employee’s regular hours may earn holiday premium pay; however, payment cannot be made until after the lapse is over,” OMB wrote. “Excepted employees who are not otherwise scheduled to work on a holiday are not required to work. If an excepted employee does not work on a holiday, the employee must be placed in a furlough status for the holiday.”

Since Saturday is the last day of the two-week pay period, OMB said that payroll processing will be initially unaffected, and federal workers can expect to receive their regular paycheck at the normal time: sometime between Dec. 28 and Jan. 3. If a shutdown commences Friday night, federal workers who are scheduled to work on Dec. 22 will not receive pay for that day in their paycheck until after the government reopens and Congress authorizes back pay.

Although all scheduled paid leave is cancelled for employees of an agency where appropriations have lapsed, OMB said there are procedures to help workers who may be taking “use-or-lose” leave before the leave year ends on Jan. 5.

“All leave is cancelled for lapse-affected employees during a lapse in appropriations,” OMB wrote. “In general, if the cancellation of annual leave due to a lapse causes an employee’s annual leave balance to exceed the applicable annual carry-over limit at the end of the leave year, such cancelled leave may be restored to the employee’s credit following agency procedures, since the lapse is considered an exigency of the public business.”

Officials also sought to ease concerns that excepted employees could have vacations cancelled due to the shutdown, ordering that all previously scheduled leave during the week of Christmas would be classified as “intermittent” absences.

“Intermittent unpaid absences are permitted for excepted employees (e.g., on days the employee was previously scheduled to take leave or be in holiday time off status during the work week beginning on December 23),” OMB wrote. “Excepted employees must be furloughed when excused from duty, if the absence cannot be accommodated with other work schedule flexibilities.”

OMB also sought to make the process by which furloughed employees institute an orderly shutdown easier, given the holidays. Although ordinarily, on the first day of a shutdown, furloughed employees go to work for four hours to perform “shutdown work,” if a shutdown commences Dec. 22, furloughed workers will only be required to come in for those four hours in the first day after Christmas that they already had been scheduled to work.

“If an employee was scheduled to be on leave on the workdays immediately after the lapse commences, the employee is not required to report to duty to perform orderly shutdown activities on a scheduled leave day, even though the leave has been cancelled,” officials stated. “An agency may allow such an employee to perform required orderly shutdown activities (if any, including receipt of a furlough notice) on the first workday on which the employee had been scheduled to return to duty.”