Pay Freeze Ends: Federal Employees to Get 1% Raise in 2014

The president has issued an executive order that will give federal employees an across-the-board pay raise of 1% “on the first day of the first applicable pay period beginning on or after January 1, 2014.”

President Obama  issued an executive order late Friday granting a 1% across-the-board pay increase to federal workers for 2014.

The executive order had been expected. The raise was requested by the White House earlier this year. Congress did not take any steps to prevent the implementation of the 1% raise as it could have done on more than one occasion including in the latest budget agreement. That budget agreement will require new federal employees to contribute more toward their future retirement pensions.

This will be the first across-the-board pay raise for federal employees since federal employees received a 2% increase in January 2010. Federal employees have still been able to receive payments such as bonuses, overtime, within-grade increases and promotion pay raises. While the raise applies to most federal employees, blue-collar workers (wage grade) will not receive any increase.

Federal agencies must accommodate the pay increases within their budgets and they do not collect additional funds because of Mr. Obama’s order. Locality pay will remain at the same level as in 2013.

Joseph A. Beaudoin, president of the National Active and Retired Federal Employees Association (NARFE), said “Today’s announcement by the president provides much-needed relief for America’s hard-working, middle-class federal employees whose paychecks have been frozen while the cost of gas, groceries and housing has increased. As the pay gap between private- and public-sector workers has grown, ending the three-year pay freeze for public workers is an important investment in maintaining the strength of the federal workforce.”

No doubt, readers will have questions about their 2014 pay rates. Many of these questions cannot be definitively answered until the documents implementing the new pay rates have been issued by the Office of Personnel Management.

About the Author

Ralph Smith has several decades of experience working with federal human resources issues. He has written extensively on a full range of human resources topics in books and newsletters and is a co-founder of two companies and several newsletters on federal human resources. Follow Ralph on Twitter: @RalphSmith47