Why Do Current Federal Employees Get a Higher Raise Than Federal Retirees?

View this article online at https://www.fedsmith.com/2017/04/03/current-federal-employees-get-higher-raise-federal-retirees/ and visit FedSmith.com to sign up for free news updates
By on April 3, 2017 in Pay & Benefits, Q&A with 0 Comments

3D cartoon person sitting on top of a piggy bank looking confused

Q: Why do current federal employees get a much higher pay raise than federal retirees? I am a retiree and feel that this is unfair.

A: Current federal employees do not receive a Cost of Living Allowance (COLA), only the pay raise. The COLA is for federal retirees and Social Security recipients. Both are calculated differently. The COLA is automatic whereas the pay raise is determined through a political process. In some years the COLA is higher, in others the pay raise is higher.

Current federal employees also receive locality pay which varies depending on the location in which the employee works.

We have posted many articles on the subject on FedSmith.com. You can click on the “COLA” tag to see articles related to this subject and also use the search form located on the top right hand side of this or any other page to quickly find them. I’ve also included a couple of examples below.

© 2020 Ralph R. Smith. All rights reserved. This article may not be reproduced without express written consent from Ralph R. Smith.


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 onĀ federal human resources. Follow Ralph on Twitter: @RalphSmith47