The council didn't make new locality pay recommendations but encouraged speedy implementation of existing ones.

The council didn't make new locality pay recommendations but encouraged speedy implementation of existing ones. Nelson_A_Ishikawa / iStock Getty Images Plus

Implement locality pay changes quickly, salary council urges OPM

The annual list of recommendations, made in February but made public this month, did not alter the map of locality pay areas, but reiterated the importance of proposals already tentatively approved by the Biden administration.

An advisory council dedicated to examining issues related to federal employee compensation issued no new recommendations for changes to the map of locality pay areas in a newly released report, instead urging quick implementation of proposals that already received a green light from the president’s pay agent.

In a report dated Feb. 4 but only published by the Office of Personnel Management this month, the Federal Salary Council said none of the regions currently being studied by the Bureau of Labor Statistics regarding the pay disparity between federal workers and private sector employees currently meet the criteria to become locality pay areas.

Instead, the council, which is made up of a mix of presidentially appointed federal human resources experts and representatives of unions and other federal employee organizations, focused its report on reiterating a series of recommendations approved last December by the president’s pay agent, a body made up of OPM Director Kiran Ahuja, Office of Management and Budget Director Shalanda Young and then-Labor Secretary Marty Walsh. But in order for those recommendations to be implemented, OPM must first issue regulations.

In terms of discrete additions to the map of locality pay areas, the salary council urged swift action to implement the new locality pay areas of Fresno, Calif.; Reno, Nev.; and Spokane, Wash. Additionally, Dukes and Nantucket counties, Mass., would join the Boston locality pay area; Huron County, Mich., would join the Detroit locality pay area; and Pacific and San Juan counties, Wash., would be included in the Seattle locality pay area. Greensville County and the city of Emporia in Virginia would both become part of the Richmond locality pay area.

Although the president’s pay agent has routinely advanced salary council recommendations on additions to the list of locality pay areas, a series of recommendations stalled during the Trump administration due to a lack of consensus between federal employee group representatives and presidential appointees. Those include how to incorporate changes to OMB’s map of metropolitan statistical areas and combined statistical areas into the locality pay system, as well as updates to the locality pay area criteria related to commuting rate for counties not tied to an OMB-designated urban center as well as the requirement that a minimum number of General Schedule employees live in a county.

Last year, the president’s pay agent adopted proposals on those issues long supported by federal employee groups: only adopting OMB changes to their statistical areas maps in cases where locations were added while holding harmless locations that were removed; increasing the commuting rate to 20%; and eliminating minimum General Schedule employment threshold altogether.

“Since the pay agent tentatively approved [these changes] in its December 2022 annual report, we recommend the pay agent complete the regulatory process required to implement [these changes] as soon as possible,” the report states.

Recent filings from OPM suggest that the federal government’s HR agency plans to do just that. According to a quarterly regulatory agenda for the agency posted on the Office of Information and Regulatory Affairs website, the agency is working on regulations to implement the council’s recommendations.

“The Office of Personnel Management is proposing regulations on behalf of the president’s pay agent to change the geographic boundaries of General Schedule locality pay areas,” OPM wrote. “The proposed changes in locality pay area definitions would be applicable on the first day of the first applicable pay period beginning on or after Jan. 1, 2024, subject to issuance of final regulations. The locations proposed for inclusion in a locality pay area separate from the Rest of U.S. locality pay area have all met criteria previously recommended by the Federal Salary Council and approved by the pay agent for nationwide use in the locality pay program.”

A date estimate included with the filing suggests OPM is aiming for the regulations to be published in the Federal Register in September.