1.4% Plus Locality Pay Proposed for 2018
As is often the case, the president’s proposal for an average pay raise is moving forward in the absence of any action by Congress. President Trump has proposed a pay raise of 1.4% for 2018. In addition, a locality pay raise averaging 0.5% has been proposed which would bring the 2018 average pay raise up to 1.9% starting in January.
Late in August, President Trump sent a letter to the Speaker of the House and the President of the Senate on the 2018 pay raise. He wrote in the letter:
Under current law, in addition to a 1.9 percent across-the-board increase for the base General Schedule, locality pay increases averaging 26.16 percent and costing $26 billion would go into effect in January 2018. A pay increase of this magnitude is not warranted, and Federal agency budgets could not accommodate such an increase while still maintaining support for key Federal priorities such as those that advance the safety and security of the American people. Accordingly, I have determined that it is appropriate to exercise my statutory alternative plan authority under 5 U.S.C.5303(b) and 5304a to set alternative January 2018 across-the-board and locality pay adjustments. Specifically, I have determined that for 2018, across-the-board pay increases will be 1.4 percent and locality pay increases will average 0.5 percent, resulting in an overall average increase of 1.9 percent for civilian Federal employees.
Role of President and Congress on Pay Raise
In some years, appropriations bills in Congress have precluded the president from granting federal workers a pay increase and effectively freezing federal employee salaries. In recent years, Congress has left the decision on a pay raise up to the president. Congress can propose and pass another amount in the budget process if it chooses to do so.
There is no indication that the approach in Congress on the pay raise for 2018 will be any different. In fact, the chairman of the Senate Appropriations Committee has released an appropriations bill, which will, again next year, effectively leave the 2018 pay raise issue for federal employees up to the president.
This is not the final step in the process and it could still change. But, based on the experience of recent years, Congress has not indicated an interest in becoming involved in determining the next annual federal employee pay raise. So far, even though it is late in the year, it appears Congress will once again punt on the issue.
In all likelihood, we will see an executive order issued in December affirming a 1.9% average 2018 pay raise for federal employees. Last year, President Obama issued an executive order on December 28th affirming the 2017 annual pay raise which amounted to an average of 2.1%.