The Trump administration has again proposed to not raise federal employe pay in January, while setting up a $1 billion government-wide performance pay pool, although details for the latter are few even thought it’s being pitched as a tradeoff.
OMB director Mick Mulvaney testified in support of those proposals, first raised in the White House budget plan in February, at a House Appropriations subcommittee hearing on the budget for his own agency that also touched on pay issues.
Federal employee organizations are warning that a salary rate freeze is looking more likely than funding a performance pay pool. The budget had assumed that the money would come from an agreement for the current fiscal year; that measure has since been enacted but it provided no such funding. That leaves it up to Congress to decide whether to appropriate that money in a spending bill for the fiscal year starting in October. The House hearing was one of the early steps in a long process toward making that decision.
If spread across the workforce equally, $1 billion would translate into about a 1 percent increase—although the intent is not to spread it equally but rather to concentrate it among top performers. But the administration so far has not outlined how that would be handled, beyond suggesting that some of the funds be used to operate pilot pay for performance programs. That likely would mean that not all federal employees would be eligible at first, and that the payouts even for employees in test programs could be delayed until well into 2019 or even later since even design work has not yet started.
The budget proposal also indicated that some of the money would be used to enhance recruitment and retention in high-demand occupations—limiting the amount available for performance-based pay—but the administration similarly still has not said how much would be carved out. The budget also calls for adding a year to each of the waiting periods for within-grade raises.
Mulvaney meanwhile acknowledged that a 2017 CBO report finding federal employees slightly ahead on pay on average also concluded that the most-educated federal employees overall are well behind. The budget had mentioned that distinction only in passing while focusing mainly on CBO’s finding that less educated employees are ahead on average. However, he did not propose to exempt those deemed behind in pay from the freeze.
Some congressional Democrats have proposed a 3 percent federal raise for January; the appropriations bill under consideration at that hearing, the general government bill, would be the most natural vehicle for any decision on a raise. Congress in recent years has kept silent, allowing the White House proposal each year to take effect by default.