Federal Workers Spared from Cuts, For Now

By on January 2, 2013 in Current Events, Pay & Benefits with 12 Comments

With the fiscal cliff deal passed in Congress this week, federal employees who were bracing for furloughs have been let off of the hook for now. However, the agreement only covers the next two months, opening the door for possible furloughs unless sequestration and spending are addressed soon.

The agreement set aside $24 billion to prevent automatic spending cuts that were scheduled to kick in this week that could have led to furloughs or RIFs. The new deadline for sequestration is now set for early March unless Congress comes up with another agreement prior to that time.

Agencies had been planning to give furlough notices to federal employees this week had no agreement been reached. DoD put plans to notify as many as 800,000 employees on hold for now, however, a Pentagon spokesman said furloughs would be even harder to implement in March because of how the agency’s fiscal calendar works. Since the fiscal year ends in October, the agency would have even less time to implement mandatory budget cuts, potentially putting even more workers at risk.

Two key problems with the potential to impact federal workers still remain unaddressed.

One is the threat of sequestration which will reduce agency funding by over $1 trillion over the next decade, creating the possibility that agencies will be forced to make cuts to stay on budget, potentially leading to furloughs, RIF’s, hiring freezes, or other negative impacts for federal workers.

A second is the debt ceiling – the government is continuing to run up against its borrowing limit, so unless the debt ceiling is raised or spending is reduced, this could potentially lead to furloughs for the federal workforce. The National Federation of Federal Employees described the situation this way:

Were Congress not to approve the essential increase in the nation’s borrowing limit, the government would be forced to operate on the amount of money it takes in through taxes, which represents roughly 60% of expenditures. This means that Congress would have to prioritize its spending to pay past-due bills it already incurred with less than 2/3rd’s of the necessary funding. In brief, this means federal employees across government would see furloughs, particularly at agencies where the workforce constitutes a large portion of the budget.

Federal employee unions called the agreement reached in Congress for the fiscal cliff a “bad deal” for federal workers since these problems still remain unaddressed.

William R. Dougan, National President of the National Federation of Federal Employees, said, “The most important federal workforce issue of our generation – sequestration – continues to hang over the head of federal employees throughout government. Furthermore, the failure to address the nation’s borrowing limit will likely lead to another prolonged political standoff, leaving federal workers uncertain of whether they will have a job to come back to for a third time in two years.”

NTEU President Colleen M. Kelley said, “Congress can still take action to avoid the devastating impact of the indiscriminate cuts and I urge lawmakers to do so. Federal employees have just ended a very difficult year in which they faced potential government shutdowns and constant attacks on their pay and benefits, and a pay freeze extending more than two years.”

Despite these challenges, the fiscal cliff agreement has left the 0.5% pay increase set to take effect in March intact, although the House did pass a measure to block the pay increase, however it is unlikely that it will get through the Senate.

© 2016 Ian Smith. All rights reserved. This article may not be reproduced without express written consent from Ian Smith.

About the Author

Ian Smith is one of the co-founders of FedSmith.com. He enjoys writing about current topics that affect the federal workforce. Ian also has a background in web development and does the technical work for the FedSmith.com web site and its sibling sites.

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  1. Bruce Grither says:

    From my chair it seems the democrats are the source of the problem.  SPEND SPEND SPEND, TAX TAX TAX.
    We need to reduce government….not inflat it.

    How about spending exactly the amount taken in each year and no more.   That’s the way to solve the problem.  If we are spending more than we take in..that means you cut back.   Common sense.     How about elinminating “base line budgeting”  that increases the budget by 10 percent automatically each year?  How about addressing the “intitlements” issue and make it stand alone outside the budget for everything else ( Surprise:  There really isn’t such a thing as a Social Security trust fund)   All SS taxes goes into general revenue.   How  about taking that tax money and keep it out of the general revenue and manageable separately?

    Some easy basic steps that will work.  

  2. Tired Fed says:

    It doesn’t take a rocket scientist to determine that Congress couldn’t care less about the federal employees.  They seem to have us walking on eggshells every year in October. This time around the uncertainty seems to go on forever. We should go back to square one and try out a brand new batch of flunkies.

  3. Ds22191 says:

    they should all be put in jail for not doing their jobs brought up on charges of falsification pretending to work lol! They exspect me to do my work they should do what the public elected them to do IN A TIMELY MANNER.

    • Sumo says:

      Except, for some, the public that elected them told them to not raise taxes one cent, and cut spending.  And for others, the public that elected them told them to do the opposite: don’t cut programs, get more taxes out of the well off.  The polarized gridlock we are seeing is a direct result of the polarized veiws of the public who elects congress to begin with.

  4. InFedL says:

    Can’t Wait! Looking forward to lots of furlough time. Could definitely use the additional time off and extra vacation time. Hopefully, early-out offers will be extended to all eligible federal employees.

  5. DON_Supervisor says:

    With the loosening of the welfare, food stamps, and disability requirements by the 0bama administration the cost of entitlements have grown significantly over the last 4 years.  If we as a nation are going to continue to support the entitlement culture the cuts will need to come from somewhere else.  0bama is only too happy to cut the DoD as long as he has political cover.

    • Fed_Peasant says:

      It does not help the DOD budget cause when you often have generals, admirals, & other senior leaders living like royalty, & sometimes acting like felons.

    • Disgusted Fed Worker says:

      I don’t know about other fed employees, but I sure ain’t living like royalty…well, maybe like the Russian Nobility after the October revolution in early 20th century….

  6. Soonershooter says:

    Disgusting, what a mess, both parties should be ashamed of getting kicking this can down the road for years…..

    • merlin says:

      roger that……plenty of blame to go all around on this one…….wish someone in DC would stop blaming and do something. I believe that is called leading.

      • massconfusion2 says:

        Doing something in DC  requires that both Congress and the President choose to govern, which is something we elected them to so.  The 112th Congress had the worst public opinion rating of any Congress and passed the fewest bills of any Congress.  Much of this was due to the House Republican’s policy that no bill would be brought to a vote unless the majority of Republicans wanted the bill to be passed.  In my view that policy is neither “leading” or “governing.”