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Your 2021 federal pay raise is still up in the air

This content is sponsored by WAEPA.

December is usually the time when someone – usually the president, sometimes Congress – finalizes federal pay for the next year.

To date, it’s unclear what the outcome will be for federal employees in 2021.

President Donald Trump proposed a 1% across-the-board federal pay raise back February. The proposal didn’t include a locality pay adjustment.

But since the president submitted his federal pay raise proposal to Congress, a lot has changed. The World Health Organization declared the COVID-19 crisis a pandemic. Agencies sent the vast majority of their employees home to work indefinitely. Stocks entered a bear market, and federal employees felt the loses in their Thrift Savings Plan. Unemployment soared.

It’s not incredibly surprising then that Senate Republicans offered up a federal pay proposal of their own. In a series of last minute appropriations bills, senators included provisions that would freeze pay for federal employees, political appointees and the vice president in 2021.

Senate appropriators have said the proposals were meant to kick-start negotiations between the two chambers about a long-term omnibus spending package for 2021. The current continuing resolution expires Dec. 11, and congressional leaders have said they would prefer to agree to a budget deal rather than kick the can down the road with another short-term funding solution.

Federal pay is one of those topics where congressional leaders will need to negotiate. While the Senate explicitly recommended freezing federal pay in 2021, the House deferred to the president and remained silent on the issue.

In negotiating a final version of an omnibus spending package, Congress could choose to adopt the Senate’s version and freeze federal pay, or it could include a specific raise in conference legislation. Congress could also choose to stay silent on the topic, as the House has already done, which may ultimately leave it up to the president to decide at the end of the year.

No federal pay raise or freeze is official until the president signs an executive order setting pay rates for the next year.

Beyond federal pay, there are a few other provisions that federal employees should watch this month.

The Senate’s budget proposals, for example, included a provision aimed at resolving the ongoing debates over the Thrift Savings Plan and the future of the international fund.

The provision would prohibit the TSP from making investments in countries that don’t comply with U.S. accounting inspections or oversight. A bipartisan group of lawmakers, and the president himself, have expressed concerns with the TSP’s original plans to expand the I fund’s benchmark into emerging markets, including China.

The TSP eventually dropped those plans amid pressure from the White House, but the Senate seems intent on quashing any attempts by the Federal Retirement Thrift Investment Board to broaden the I fund to Chinese markets.

Finally, this year’s defense authorization bill contains few major provisions of note for federal employees. But the House version of the defense policy bill does include language that would expand the paid parental leave program to all federal employees.

Congress included 12 weeks of paid parental leave in the 2020 NDAA, but in the rush to push through a new program, the authors of the legislation inadvertently left out portions of the federal workforce.

A House provision would at last expand the paid parental leave program to non-screeners at the Transportation Security Administration and employees at the Federal Aviation Administration, as well as tens of thousands of temporary federal employees and members of the judicial branch workforce. It also clears up any ambiguities for medical professionals at the Veterans Health Administration.

Expanding paid parental leave to all federal employees has bipartisan support.

FEPLA, which grants federal employees up to 12 weeks of paid leave for the birth, adoption or foster placement of a new child, went into effect in October.

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