Fedweek

The 1 percent general schedule pay raise that was effective in the first full pay period of the year, covering January 3-16 for most, should be reflected in pay distributions covering that period.

Blue-collar employees receive their raise at differing times of a fiscal year, including some getting raises retroactive to last October; they will receive the same 1 percent as GS employees, under terms of the wrapup budget law enacted late in 2020. SES members and those under other high-level pay systems do not get raises automatically but as a practical matter many agencies pay their performance-based raises at the start of the year.

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Also taking effect as of the first pay period of the year are FEHB and FEDVIP premiums for the 2020 plan year, reflecting choices enrollees made—including by taking no action and keeping their current coverage, which is true of the large majority—in the open season last fall. Similarly, the pay distribution will reflect elections made for health care accounts, dependent care accounts or both under the flexible spending account program.

Also increasing automatically with a raise are TSP investments by those who invest on a percentage of salary basis; agency contributions under FERS likewise rise. For those who invest on a dollar amount per pay period basis, investments won’t rise unless they make a new election; for those under FERS, matching contributions won’t rise unless they do so, although the automatic 1 percent amount will rise regardless.

A special consideration for most employees apart from the Postal Service is the beginning of the collection of debt owed to Social Security because those withholding were suspended over September-December for pay periods in which an employee’s earnings subject to that tax were below $4,000. To make up for it, additional Social Security withholdings are being taken, on a schedule that varies somewhat by payroll provider, so that the difference will be repaid by the end of the year.