OPM Guidance Addresses Pay Issues arising During, After Shutdown

Following is the portion of OPM guidance on the impact on federal employees of a funding lapse addressing pay-related issues both during and after a shutdown. 

Note: OMB struck language from its guidance on shutdown pay on Oct 3, referencing the Government Employee Fair Treatment Act of 2019 – signed by Trump in 2019. WH officials have claimed the law merely provides conditions for Congress to authorize back pay after a shutdown, with Trump hinting at selective treatment. OPM meanwhile has not changed (as of Oct 8) the below guidance dated Sept 28.

Will employees performing excepted work be paid for performing such work during a shutdown furlough? If so, when will excepted employees receive such payments?

A. Yes. After the lapse in appropriations has ended, employees who were required to perform excepted work during the lapse will receive retroactive pay for those work periods. (See 31 U.S.C. 1341(c)(2).) Retroactive pay is provided at the employee’s “standard rate of pay.” If the retroactive pay cannot be provided on the normal pay date for the given pay period, it must be provided at the earliest date possible after the lapse ends. (Note: Presidential appointees who are not covered by the leave system in 5 U.S.C. chapter 63 are not subject to furlough, but are also barred from receiving pay during a lapse in appropriations. These Presidential appointees will be paid after the lapse in appropriations has ended.

How is the “standard rate of pay” computed for employees whose work is excepted?

A. Employees who perform excepted work during a lapse in appropriations must receive retroactive pay for that work at the employee’s “standard rate of pay” (31 U.S.C. 1341(c)(2)). The “standard rate of pay” for excepted hours of work is the pay to which the employee normally is entitled for actual hours of work under the applicable pay rules. For example, if an excepted employee performs authorized overtime work beyond the normal requirements for his or her job, he/she will be paid for that actual authorized overtime work. All excepted hours of work are treated as time in a pay status for pay, leave, and benefit purposes.

Excepted employees who elect to use paid leave under 31 U.S.C. 1341(c)(3) to cover an authorized absence from work during a lapse in appropriations will receive pay for that leave under the normal leave rules when the lapse endsConsistent with the normal leave rules, an excepted employee may not use paid leave during periods when the employee is found to be absent without leave (AWOL). The standard rate of pay during AWOL periods is zero. If an otherwise excepted employee has an authorized absence from work during the lapse and elects not to use paid leave under 31 U.S.C. 1341(c)(3), the employee will be placed in furlough status during the authorized absence. The employee will be paid for the furlough time when the lapse ends as described in Questions D.3. and D.4. The employee will not be charged paid leave or other paid time off for authorized periods of absence from duty during the lapse, except as provided under 31 U.S.C. 1341(c)(3).

May an employee who performs excepted work be permitted to earn premium pay (e.g., overtime pay, Sunday premium pay, night pay, availability pay) during the furlough period?

A. Yes. An employee who performs excepted work and who meets the conditions for overtime pay, Sunday premium pay, night pay, availability pay, and other premium payments will be entitled to receive payment in accordance with applicable rules, subject to any relevant payment limitations, once the lapse ends. Premium pay may be earned during the lapse but cannot be paid until Congress passes and the President signs a new appropriation or continuing resolution.

Will employees who are furloughed get paid?

A. Yes. After the lapse in appropriations has ended, employees who were furloughed as the result of the lapse will receive retroactive pay for those furlough periods. (See 31 U.S.C. 1341(c)(2).) Retroactive pay will be provided on the earliest date possible after the lapse ends, regardless of scheduled pay dates. (See 31 U.S.C. 1341(c)(2).) If retroactive pay cannot be provided by the normal pay date for the given pay period, it will be provided as soon as possible thereafter. Retroactive pay is provided at the employee’s “standard rate of pay.”

How is the “standard rate of pay” computed for furloughed employees?

A. For periods of time during which an employee was furloughed during the lapse in appropriations, the “standard rate of pay” is the pay the employee would have received for the furlough hours had the lapse in appropriations not occurred and had the employee performed work. Therefore—

• An employee is entitled to receive his or her rate of basic pay for the furlough time to the extent that he or she would have been in a basic pay status but for the lapse in appropriations. (See 31 U.S.C. 1341(c)(2).)
• An employee receives retroactive pay for furlough time without being charged paid leave or other paid time off, since a lapse in appropriations generally prevents the use of paid leave or other paid time off. (However, an excepted employee may seek approval of paid leave under 31 U.S.C. 1341(c)(3). See Questions D.1a and F.2.)
• All furlough hours for which retroactive pay is received are treated as time in a pay status for pay, leave, and benefit purposes. For example, for the purpose of applying General Schedule waiting periods associated with within-grade increases, the furlough time during the lapse in appropriations is treated as time in pay status.
• A furloughed employee who, during the lapse in appropriations, had been regularly scheduled to perform overtime work or to perform work at night or during a period for which any other form of premium pay would otherwise be payable is entitled to receive overtime pay, night pay, or other premium pay as if the work had been performed.
• Allowances, differentials, and other payments otherwise payable on a regular basis (e.g., administratively uncontrollable overtime pay and law enforcement availability pay) must be paid as if the furloughed employee actually continued to work.
• All periods of time during which a furloughed employee would, but for the lapse in appropriations, have been in a pay status (including regularly scheduled overtime hours and standby duty) must be considered “hours of work” for pay administration purposes under the Fair Labor Standards Act.
• A furloughed employee is not entitled to retroactive pay for furlough periods if the employee had been previously scheduled (i.e., scheduled before the lapse) to be in nonpay status during those periods. For example, an employee may have scheduled leave without pay (LWOP) for an extended period or be in a suspension status (i.e., pay suspended based on an adverse action). In effect, those already-in-place periods of nonpay status override the furlough status. The “standard rate of pay” for such previously scheduled periods of nonpay status is zero. In addition, an employee who was directed to perform excepted work during a lapse in appropriations but failed to report to duty could have been placed in absent-without-leave (AWOL) status for missed work hours, in accordance with agency policy and procedures. For such an employee, the “standard rate of pay” for AWOL hours is also zero.

Will employees receive a paycheck for hours worked prior to a lapse in appropriations?

A. Yes. Although the payroll for the last pay period before the lapse will be processed potentially during the lapse, the minimum number of payroll staff necessary for this process will be excepted for the minimum time required to issue the checks, including checks for the last pay period before the lapse.

When an employee’s pay is insufficient to permit all deductions to be made because a lapse in appropriations occurs in the middle of a pay period and the employee receives a partial paycheck, what is the order of withholding precedence?

A. Agencies will follow the guidance on the order of precedence for applying deductions from the pay of their civilian employees when gross pay is insufficient to cover all authorized deductions.

If an employee’s pay is insufficient to permit all deductions to be made because a lapse in appropriations occurs in the middle of a pay period and the employee receives a partial paycheck, will the amount of the deductions taken from the employee’s partial paycheck be the same as normal?

A. Some deductions that are based on the amount of an employee’s gross pay (or basic pay) will be reduced in size. For example, deductions for the Federal Employees Retirement System (FERS) Basic Benefit are a percentage of basic pay paid to an employee. Other deductions, such as health insurance premiums, may be a fixed dollar amount and will not be affected. Consequently, the amount of money an employee normally sees in their paycheck will be different than what they might expect.

If an employee’s pay is insufficient to permit deductions for health or other insurance premiums or deductions for flexible spending accounts because the employee receives a partial paycheck or no pay during a lapse in appropriations, will this affect the employee’s enrollment or coverage in these benefit programs?

A. An employee’s enrollment and coverage under such programs generally will not be affected if the employee is unable to make the required deductions for insurance and other benefits due to receiving a partial paycheck or no pay during a lapse of appropriations. The one exception is that if an employee is enrolled in a health care flexible spending account through FSAFEDS, they can’t be reimbursed for eligible health care claims until they return to pay status and payroll deductions can be made.

If an employee receives a partial paycheck during a lapse in appropriations, may the employee’s agency or payroll provider defer deductions for allotments previously designated by the employee to be taken from retroactive pay when the lapse of appropriations ends in order to provide the employee with a larger partial paycheck?

A. Any changes in an allotment amount or cancelation of an allotment that was previously designated by an employee to be taken from their pay must be personally authorized by the employee under 5 CFR 550.312. Additionally, any changes to an allotment for dues to a labor organization must be taken under regulations prescribed by the Federal Labor Relations Authority (see 5 CFR 550.321) and any applicable collective bargaining agreements.

How will deductions for allotments be affected if an employee’s pay is insufficient to permit such deductions because the employee receives a partial paycheck or no pay during a lapse in appropriations?

A. Employees should consult their agency or payroll provider for information on how missed allotment deductions will be handled. Employees may want to review their allotments to determine whether they need to make alternative arrangements (e.g., if using allotments to pay loans, alimony, etc.). Any allotment for dues to a labor organization previously designated by an employee and which was deferred by the agency or payroll provider during the lapse in appropriations because the employee’s pay was insufficient to cover the dues allotment deduction would be taken from retroactive pay when the lapse in appropriations ends.

How will deductions for court-ordered garnishments be affected if an employee’s pay is insufficient to permit garnishment deductions because the employee receives a partial paycheck or no pay during a lapse in appropriations?

A. Employees should consult their agency or payroll provider for information on how missed garnishment deductions will be handled and may need to make alternative arrangements. If a payroll provider is unable to effectuate the garnishment, it should provide a notice to that effect to affected employees and indicate how the provider intends to handle the missed garnishments going forward. We should note that some payroll providers will need to confer with counsel about how much to collect at any given time in any make-up payments.

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