Deadline approaches for Biden’s 5.2% pay raise plan

Although President Biden and congressional appropriators appear to be in accord on the White House’s plan to grant federal employees their largest annual raise in more than two decades in 2024, there is still work to be done to make it a reality.

Biden first proposed an average 5.2% pay increase for civilian federal workers and members of the military next year when he unveiled his fiscal 2024 budget plan. That figure marks the highest annual pay increase federal employees have seen since President Carter authorized a 9.1% raise in 1980.

And although the administration and Senate Democrats have been butting heads with GOP appropriators in the House on a variety of funding issues in recent months, neither the House nor the Senate have included language in their respective spending packages to overrule the pay raise plan.

Even so, President Biden must take a couple of additional steps in order to ensure it is implemented in January.

First, Biden must formally issue an alternative pay plan by the end of this month, declaring an economic emergency to prevent the federal government from instituting automatic increases in locality pay as outlined in the Federal Employee Pay Comparability Act. For decades, presidents have used this tool to avoid much larger jumps in feds’ pay from taking effect.

The emergency declaration also tends to be when federal workers and members of the public discover how much of Biden’s proposed 5.2% raise will an across-the-board increase to basic pay, and how much will go toward an average increase in locality pay. Traditionally, 0.5% of the overall raise figure is set aside for locality pay adjustments.

Then, Biden must issue an executive order before the end of the year to finalize the pay plan so that it can be implemented for the first pay period in January. That edict confirms the pay increase, and is published in concert with a new set of basic and locality pay tables, put together by the president’s pay agent, a body consisting of the Labor secretary and the directors of the Office of Personnel Management and Office of Management and Budget.

OPM, for its part, has already begun the process of formulating new regulations to implement the pay agent’s decision last December to add four new locality pay areas, as well as to adopt a long-debated plan to update locality pay areas to better align to a recent update to the Office of Management and Budget’s map of statistical regions, adding dozens of counties to existing locality pay areas. Nearly 33,000 federal workers will see an extra increase to their pay next year as a result.

The Biden administration’s fiscal 2024 budget also alluded to as-yet unannounced plans to address the long-simmering issue of pay compression at the top of the General Schedule pay system in major cities this year. The matter has grown in importance to some federal workers as annual pay raises have shot up to try to align with heightened inflation over the last two years. Groups representing federal managers and executives are slated to meet with OPM to discuss the issue later this month.