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In a surprising reversal, President Donald Trump has announced his plans to implement a federal pay raise — rather than a pay freeze —for civilian employees in 2020.

Under Trump’s proposed pay plan, civilian federal employees would get an across-the-board pay raise of 2.6% next year. Locality pay rates, however, will remain frozen at 2019 levels.

“I have determined that for 2020 — while across-the-board base pay will increase by 2.6% — the locality pay percentages shown in Schedule 9 of Executive Order 13866 of March 28, 2019, will remain at their 2019 levels,” Trump wrote in an Aug. 30 letter to congressional leadership. “This alternative pay plan decision will not materially affect our ability to attract and retain a well‑qualified federal workforce.”

As expected, Trump has chosen to deviate away from the statutory formula that typically sets federal pay adjustments for any given year. If he didn’t make his own recommendation, locality pay increases of 24.01%, worth about $24 billion in the first year, would have kicked in at the start of 2020.

But Trump’s decision is a significant surprise, considering his 2020 budget submission included a recommendation to freeze federal pay for next year. The president had also initially implemented a freeze for 2019, but Congressional appropriators later added a retroactive pay raise of 1.9 percent for this year.

“As noted in my budget for fiscal year 2020, our pay system must reform to align with mission-critical recruitment and retention goals, and to reward employees whose performance provides value for the American people,” Trump wrote. “My administration will continue to support reforms that advance these aims.”

The pay raise would become effective Jan. 1.

“NTEU appreciates the president backing away from his proposed pay freeze for federal employees in 2020,” Tony Reardon, the president of the National Treasury Employees Union said in a statement Friday evening. “A pay freeze was simply uncalled for given the pay gap between federal employees and those in the private sector along with all the challenges federal employees have faced, including the longest partial government shutdown in our nation’s history.”

Members of the military are on track to receive a 3.1% pay raise next year, as recommended by the White House and both the House and Senate in their respective versions of the annual defense authorization bill.

All presidents must submit an alternative pay plan to Congress by Aug. 31, otherwise automatic locality increases under the Federal Employees Pay Comparability Act (FEPCA) kick in at the start of the next year.

Anticipating that the president would propose a federal pay freeze for next year, the House had already cleared a 3.1% federal pay raise for 2020. The Senate, however, hasn’t touched a single appropriations bill for next year, meaning congressional leaders will have to conference over federal pay and other topics when they return from August recess.

Though NTEU, along with other federal employee unions and organizations, praised the president for changing his mind, they appear ready to push for a 3.1% pay raise, which includes a 0.5% locality pay adjustment.

“I appreciate the president’s recognition of the federal workforce, but to maintain parity with both the military members they support and the private sector, federal employees deserve a pay adjustment based on market values where they work,” Ken Thomas, national president of the National Active and Retired Federal Employees (NARFE) Association, said Monday in a statement.

The American Federation of Government Employees also called the president’s proposed 2.6% federal pay raise a “positive step” but is advocating for further locality pay adjustments.

“I call on Congress to finish what the White House has started by approving the House-passed pay raise during upcoming budget negotiations,” AFGE National President J. David Cox said Saturday in a statement.

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