Federal Wage System Increases in 2016

Now that the 2016 pay raise for federal employees under the General Schedule has been finalized, what can federal workers under the Federal Wage System expect to see in terms of a pay raise?

The annual guessing game about pay increases for those covered by the General Schedule was resolved on Friday, 18 December 2015, when the President issued an Executive Order finalizing a 1.3 percent increase in GS rates effective with the beginning of the first pay period that starts on or after 1 January 2016.  The Order, however, did not discuss employees paid under the Federal Wage System.

A review of the Department of Defense website reminded us that for FWS employees, who are involved in trade, craft and laboring occupations at various military and civilian Federal agencies, the 2016 FWS pay schedules will not be released until the Fiscal Year 2016 pay limitation is determined.  DOD issues the wage schedules for most FWS employees.  The notice goes on to say that once issued, FWS wage schedules will be made retroactive to the normal effective date.

FWS wage schedules are staggered in their implementation in that not all of them become effective on one date.  For example, the Montana Wage Area schedule became effective on 4 September 2015, while the one covering Martinsburg WV became effective on 15 March 2015.

Shortly after the President signed the Executive Order regarding GS pay increases, the U.S. Office of Personnel Management released a memorandum regarding the wage increases for FWS employees.  This memorandum indicates that the Consolidated Appropriations Act of 2016 establishes that FWS wage increases may not exceed 1.37 percent.

However, it also establishes another requirement, and that is that the increases in a FWS wage area may not exceed the percentage increase received by GS employees in the same geographic area.  Thus, the FWS employees may receive no more than 1.37 percent increase in wages, but may receive less than that if the GS employees in the same geographic location will receive less than 1.37 percent.

Another change that will affect some FWS employees is that the GS locality pay areas in several parts of the country were redefined.  An example is Bryan County OK.  It is being moved from the GS locality pay area known as Rest of U.S. or RUS to the GS locality pay area known as the Dallas-Fort Worth-TX-OK locality pay area.  The FWS employees in Bryan County OK, as a result of this change, will receive the same increase that is granted to GS employees in Dallas-Fort Worth rather than the amount granted to GS employees in the RUS locality pay area, which is typically smaller than that granted to large metropolitan areas such as Dallas-Fort Worth.

So the short answer is that FWS employees will receive a wage increase of no more than 1.37 percent, but may receive less than that if GS employees in the same geographic location receive less than that amount.

This practice of limiting FWS wage increases has been occurring since about the late 1970s.  And this increase will be in lieu of whatever rates were shown to be appropriate based on the annual wage surveys carried out to determine the going rates in each FWS local wage area.  The new rates will become effective about one year after the effective date of the last increase in each FWS local wage area and will be made retroactive if the normal effective date already has passed.

Wayne Coleman is a federal pay expert available to help your agency avoid premium pay claims through on-site training. Contact him for more information.

About the Author

Wayne Coleman is a compensation consultant whose career at various Federal agencies and in private practice spans almost 40 years. During this time he has written about and provided training on overtime and premium pay, on the principles of FLSA coverage and exemption, and on related Federal compensation issues. Wayne is available to help your agency avoid premium pay claims through consulting services and training. You can contact him at wayneslyhouse@comcast.net.