WH: Addressing pay compression is a critical component of attracting and retaining experienced talent in roles with significant market competition. Image: allstars/Shutterstock.com
While seeking a January 2025 raise of 2 percent (see related story), the White House’s fiscal 2025 budget proposal cites several initiatives related to federal pay.
“In addition to year-to-year pay increases, the Administration is pursuing structural reforms to enhance the competitiveness of the Federal pay system,” it says.
“The Administration is committed to addressing the challenges caused by long-standing career Senior Executive Service and higher-graded General Schedule (GS) pay compression, as well as blue collar Federal Wage grade pay limitations. Addressing pay compression is a critical component of attracting and retaining experienced talent in roles with significant market competition.”
It said those options—which would require approval of Congress–include “increasing Executive Schedule official rates (while maintaining the senior political appointee pay freeze), which are tethered to SES, GS, and other senior-level employee pay caps, and modifying how the rates are adjusted each year; removing current ceilings in the Federal Wage System (FWS) wage schedules and establishing a statutory minimum for annual pay rate adjustments; repealing the aggregate pay rate limitation that caps the total amount of Title 5 allowances, differentials, bonuses awards, and other similar payments an employee may receive in a calendar year; and raising the special rate limitation for certain categories of employees to provide competitive salaries, particularly for cyber, STEM, and healthcare professions.”
“Additionally, OPM will be working with agencies in 2024 on targeted pay flexibilities to support the Federal cyber and specialized technology workforce. The Administration is continuing to carefully track Federal civilian pay and incentives in comparison to comparable roles in the private sector and will work to mitigate attrition risk within the existing workforce. For example, in 2023, OPM issued proposed regulations to provide agencies with access to higher payment limitations for recruitment and relocation incentives without requesting approval from OPM,” it says.
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