Senate appropriators propose federal pay freeze for civilian employees in 2021

Senate Republicans are including a federal pay freeze for civilian employees as part of a 2021 appropriations bill, which they released Tuesday morning.

The proposal is a break from President Donald Trump recommended back in February and what the House endorsed over the summer, setting up further debate on federal pay over the course of the next four weeks.

According to Senate Republicans, the freeze would also apply to senior executives and senior-level employees, unless they’re promoted to a new position with higher-level duties and pay.

The vice president and political appointees would also be subject to a 2021 pay freeze, according to the proposal from Senate Republicans.

These provisions are included in a draft of the financial services and general government bill, which Senate Republicans released Tuesday morning. They also released their own drafts of the 11 other appropriations bills, which congressional leaders anticipate will serve as the basis for negotiations between both the House and Senate over the course of the next few weeks.

The current continuing resolution expires on Dec. 11. The lame-duck Congress must pass either a second temporary stopgap or a complete omnibus spending package to avoid a government shutdown next month.

Rather than proceed with a second CR, congressional leaders have said they’d prefer to complete a full omnibus.

“Our goal is to work with the House to conference all twelve appropriations bills and avert a government shutdown,” Patrick Leahy (D-Vt.), vice chairman of the Senate Appropriations Committee, said Tuesday in a statement. “We only have four weeks to do it. In order to accomplish our work, we need Senate bills to work from. The 12 bills being released by the chairman on Tuesday will help us move forward in this process. Many of the bills were the result of bipartisan work, and I appreciate those areas where we were able to come to agreement. However, there are significant issues that we will want to address in negotiations with the House.”

The Senate likely won’t vote on individual appropriations bills — there isn’t time. Instead, these appropriations bills serve as a starting point for the Senate’s negotiations with the House, which passed 10 of 12 bills earlier this summer.

“By and large, these bills are the product of bipartisan cooperation among members of the committee,” Richard Shelby (R-Ala.), chairman of the Senate Appropriations Committee, said in a statement. “As negotiations with the House begin in earnest, I look forward to working with Chairwoman [Nita] Lowey (D-N.Y.), Vice Chairman Leahy, and Ranking Member [Kay] Granger (R-Texas) to resolve our differences in a bipartisan manner. Time after time, we have demonstrated our willingness to work together and get the job done. We have before us the opportunity to deliver for the American people once again.”

The House remained silent on the issue of federal pay so far this year, essentially endorsing the president’s own proposal. President Donald Trump proposed a 1% across-the-board federal pay raise for civilian employees back in February. His proposal didn’t include any locality pay adjustments.

As House and Senate appropriators begin budget negotiations, there are a few outcomes that could impact federal employees and their paychecks next year.

Lawmakers could adopt the Senate’s proposal and freeze federal pay at 2020 levels. Or they could remain silent as the House has done, giving way for the president to determine his course for federal pay via the typical end-of-year executive order. In that case, Trump could continue with his original 1% federal pay proposal from February.

He could also freeze federal pay on his own. No pay adjustment for next year is official until the president signs an executive order setting pay rates for 2021.

Federal employee groups and Democratic lawmakers were critical of the proposal.

“As our federal employees work every day to deliver vital services to the American people, Republicans continue to try to strip them of their rights, politicize the merit-based system and deny them fair pay for their hard work,” Sen. Chris Van Hollen (D-Md.) said in a statement. “We cannot let this stand. I will fight tooth and nail to stop this proposed pay freeze and ensure that the good work of federal employees is fairly compensated.”

The National Active and Retired Federal Employees (NARFE) Association encouraged Congress and the president to recognize the federal workforce with a raise.

“This is a year when federal employees have stepped up to respond to a global pandemic, with tens of thousands on the frontlines working on behalf of the American people and contracting COVID-19 in the process,” Jessica Klement, NARFE’s staff vice president for programs and policy, said in a statement to Federal News Network. “Yet they face the prospect of a pay freeze. That’s not just an affront to public service; it’s a policy that risks losing highly competent and productive employees from the ranks of our federal government, to the detriment of the citizens they serve.”

The American Federation of Government Employees described the Senate’s proposal as a “slap in the face.”

“Trying to outdo President Trump in disrespecting federal employees by eliminating even the paltry raise he put forth is completely unwarranted and will only worsen the government’s ability to function effectively,” AFGE National President Everett Kelley said in a statement.

Beyond the proposed pay freeze, Senate appropriators also included a provision that would prohibit the Thrift Savings Plan from making investments in countries that don’t comply with American accounting regulator inspections or oversight.

This provision appears to be intended to relieve concerns from a bipartisan group of lawmakers, who criticized the TSP’s plans to expand benchmark for the international fund into emerging markets, including China.

The TSP pulled back on these plans earlier this year amid pressure from the White House.

In addition, Senate appropriators included a $25 million funding boost for the Office of Personnel Management over the previous year. OPM, according to its inspector general, is still dealing with the financial consequences of the 2019 transfer of the security clearance business to the Pentagon.

The House appropriators were less generous with OPM. Their bill included an $8.5 million budget boost for the agency.

The Senate proposal would also allow the General Services Administration to spend $228 million more out of the Federal Buildings Fund.

The Treasury Department would also see slightly more funding next year — about a $20 million increase over 2020 levels — under the Senate proposal. It maintains spending levels for the IRS but includes provisions that would allow Treasury’s Do No Pay Center to utilize the Social Security Administration’s Death Master File in effort to cut back on improper payments.

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