Barring any action by Congress, raises would be finalized by a late-year executive order and would take effect at the start of the first full pay period of 2025. For most employees that will begin January 11. Image: William Sawalich/Shutterstock.com
By: FEDweek StaffPresident Biden has reaffirmed his intent for a 2 percent federal employee pay raise in January, meanwhile saying he would split the raise, with 1.7 percent paid across the board and the funds for the other 0.3 percentage points used for variable locality pay.
Biden stated that intent in a letter to Congress that is a routine but needed step when Congress has not enacted a raise figure into law by the end of August. In almost all cases, as in this one, the letter has repeated the raise proposal Presidents originally made in their early-year budget message to Congress.
The 2 percent raise would be the smallest in the Biden administration, following 2.7, 4.6 and 5.2 percent increases over 2022-2024; the 2024 increase was the largest since 1980 and the 2023 increase was the second-largest in that time.
The letter sets an “alternative” raise to be paid by default should no raise figure be enacted into law by year’s end—alternative to the increase that otherwise would take effect automatically under the 1990 federal pay law. That would be 27.54 percent, based on the Federal Salary Council’s report last fall on the federal/private sector pay gap.
“I view the increases that would otherwise take effect as inappropriate,” he said in the letter, using language similar to that in such letters across administrations going back many years.
“We must attract, recruit, and retain a skilled workforce with fair compensation in order to keep our Government running, deliver services, and meet our Nation’s challenges today and tomorrow. This alternative pay plan decision will continue to allow the Federal Government to employ a well‑qualified Federal workforce on behalf of the American people, acknowledging wage growth in the labor market and fiscal constraints,” he said, also using similar phrasing from past letters.
Breaking off part of the raise for a locality component would turn the 2 percent figure into an average; actual raises would vary among the GS localities from several tenths of a percentage point below to several tenths above. Exact figures would come later in the year after the salary council’s annual report on pay comparisons.
Congress still could change that outcome by putting a different number into legislation, which if signed by the end of the year would override Biden’s action. However, both the House and Senate versions of the bill in which they could change the figure, the general government appropriations, effectively back Biden’s figure by taking no position.
Those bills do specify, though, that wage grade employees would again receive the same raise paid to GS employees locally even though they are under a separate locality-based system. Raises for federal senior executives and certain other career employees at senior levels are based on performance ratings, with the caps on their salaries increasing with the across the board portion of the GS raise.
Barring any action by Congress, raises would be finalized by a late-year executive order and would take effect at the start of the first full pay period of 2025. For most employees that will begin January 11.
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See also,
Top 10 Provisions in the Big Beautiful Bill of Interest to Federal Employees
A Pre-RIF Checklist for Every Federal Employee, From a Federal Employment Attorney
Work Longer or Take the FERS Supplement Now: Which is Better?
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