Issue Briefs

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Following is the portion of the Federal Salary Council’s latest report on the GS pay system, stating that while the group is sympathetic to requests to create new, higher-paid, localities in some areas due to recruiting and retention problems, none of them met the criteria for doing so for 2022.

The Council and OPM staff receive numerous requests each year to consider establishing or changing locality pay area definitions for locations that do not meet established criteria for doing so. Those requests run the gamut from simple phone calls or emails from individual employees to detailed petitions and presentations by local representatives and organizations at public Council meetings, all trying to make the case that their particular location warrants a locality adjustment, notwithstanding the fact that that location does not meet the NCS/OES criteria.

For example, Attachment 6 lists locations, most in the Rest of US locality pay area, from which groups or individuals have contacted the Council or OPM staff during the deliberative cycle these recommendations cover to express concerns about pay levels or the geographic boundaries of locality pay areas. The Rest of US locations listed do not meet criteria approved by the Pay Agent for a change in their locality pay area designation, yet representatives from some of these locations report that Federal agencies in their area have recruiting and/or retention problems. For locations listed that are already in locality pay areas separate from the Rest of US, the petitioners ask that the Council recommend a higher locality pay percentage for one or more locations in the locality pay area.

In an effort to establish a more disciplined and data-driven response to such requests, the Chairman and Council Member Bullock proposed in the Council’s April 2020 report to the Pay Agent that the Council require such representatives to support their requests with detailed HCI data that make a more quantitative case for coverage. That same report indicates that Council Members Erwin, Reardon, and Simon were open to considering HCI data but did not support a hard-and-fast policy that such data be required.

After the Council issued its April 2020 report, groups from four geographic areas—Charleston, SC; Nashville, TN; Orlando/Central Florida; and Southern New Jersey4—stated that they would try to support their requests with detailed HCI data. OPM staff subsequently received HCI submissions from Charleston and Southern New Jersey that were sufficient to support further Council consideration. The Council analyzed those submissions and concluded that while the HCI data submitted by Charleston and Southern New Jersey indicated recruitment and retention difficulties sufficient to warrant some sort of additional compensation, the evidence showed that those difficulties were limited to and/or varied significantly among certain occupational categories and/or grade levels. Accordingly, because the Council’s current statutory authority limits it to recommendations that cover all occupations and grades in a particular location, the Council concluded it could not recommend that the Pay Agent designate those areas for a locality pay adjustment.

Nevertheless, the Council members are sympathetic to the challenges Federal agencies in Charleston and Southern New Jersey face and agreed the Council should strongly endorse the approval of all appropriate pay flexibilities—such as recruiting and retention incentives and/or special pay rates—to the agencies that employ Federal workers in these two areas.

The Council notes that while the submissions by Central Florida and Nashville were not yet sufficient to make a determination with respect to locality pay, they too should be commended for their efforts and encouraged to continue them. However, the Council apprised those two areas of its statutory limitations—that is, that it can only recommend that a geographic area for a locality pay adjustment if its recruiting and retention challenges are across-the-board in nature. Accordingly, the Council encouraged the petitioners from the two areas to explore the use of the various pay flexibilities as a way of addressing any staffing issues in those two areas.

For Carroll County, IL, and other areas that can demonstrate that the only reason they do not meet the GS employment criterion for areas of application is because they have vacancies that keep them below the threshold, the Council recommends that the GS employment criterion be waived.

Background and Rationale: Carroll County, IL, meets the employment interchange criterion to be included in the Davenport-Moline, IA-IL locality pay area as an area of application but does not meet the GS employment criterion for such inclusion. In its October 21, 2020, meeting, the Council heard testimony regarding Carroll County, and according to that testimony the county would meet the GS employment criterion if all of its vacancies were filled. The Council then agreed that the GS employment criterion should be waived for a location if the only reason it does not meet the criterion is because it has vacant GS positions that keep it below the threshold.

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