Cassidy ties proposed 30% pay and benefits cuts to federal telework

Sen. Bill Cassidy, R-La., last week introduced a pair of bills that would issue draconian cuts to federal workers’ pay and retirement benefits, which he said is needed to combat “telework abuse.”

The Federal Employee Return to Work Act (S. 4834) would require agencies to pay federal employees as if they were part of the “Rest of U.S.” locality pay rate, regardless of where they actually live and work, if they engage in telework at least one day per week. Excluded from the provision are disabled employees who require telework as part of a reasonable accommodation, members of the Foreign Service, military service members, federal law enforcement officers and federal workers whose jobs require them to travel frequently.

“Federal employees get paid extra to work in higher-cost cities,” Cassidy said in a statement. “But what if they don’t show up to work? Why should they get paid? If you don’t show up for work, you don’t get paid at the same rate just for teleworking.”

Cassidy pointed to a 2023 Government Accountability Office report that found at the beginning of that year, 17 of 24 federal agency headquarters buildings experienced occupancy rates at or under 25%. But the Congressional Budget Office recently found that telework rates among private sector workers was actually higher than that of federal workers.

Cassidy’s other bill, the Federal Employee Locality Accountability in Retirement Act (S. 4833), would remove locality pay from annuity calculations under the Federal Employees Retirement System for all new federal employees. Currently, when a federal worker retires, the defined benefit portion of their retirement package is calculated by taking the average of the highest three years of the employee’s salary, including both basic and locality pay.

For federal employees in major cities like New York, San Francisco or Washington, D.C., locality pay can add up to as much as 30% of their salary. For instance, in New York, a federal employee at the GS-8 Step 1 pay grade would make $63,782 including locality pay adjustments, but that figure would drop to $54,292 if they were forced into the “Rest of U.S.” category under Cassidy’s telework bill. And under his retirement proposal, only 72%--or $46,475—of their salary would count toward their annuity.

When asked for the rationale behind cutting federal employees pay by upwards of 30% if they telework—and pensions across the board—a Cassidy spokesperson declined to comment, instead directing Government Executive to a press release announcing the bills, which described the current pay and pension systems, which date back to the Reagan administration, as “unfair bonuses in retirement.”

“The amount an employee receives through the FERS is determined in part by the average of the individual’s highest three consecutive years of base pay,” the release states. “Civil servants who receive higher locality pay will also receive more benefits in retirement. Currently, nearly 1.2 million retired civil servants are receiving FERS annuity, and the average payout is $2,126 per month.”