WGI: An Automatic Pay Raise for Federal Employees?

Only about 1 for every 1,000 federal employees is denied a within-grade increase (WGI) pay raise. Here is why.

What is a within-grade-increase (WGI) pay increase? Can it be denied to a federal employee or is it an automatic raise?

What is a WGI?

A WGI is a pay raise. This is in addition to any annual pay raise that is given to the federal workforce. A WGI applies to the General Schedule pay system in the federal government.

Each WGI amounts to a salary increase of about 3% of an employee’s salary. The amount of time for each salary increase varies. In effect, a WGI is a pay raise based on the length of time in government service at a particular step and grade in the General Schedule’s pay system.

There are three requirements for an employee to be given a within-grade increase.

  1. The employee’s performance must be at an acceptable level of competence. To meet this requirement, an employee’s most recent performance rating of record must be at least Level 3 (“Fully Successful” or equivalent).
  2. The employee must have completed the required waiting period for advancement to the next higher step.
  3. The employee must not have received an “equivalent increase” in pay during the waiting period.

Here is the breakdown of the required time limit to advance to the next step of a General Schedule grade:

Current GS StepWaiting Period to Next WGI
1, 2, or 352 Weeks
4, 5 or 6104 Weeks
7, 8 or 9156 Weeks

If an employee does not receive a promotion or a quality step increase (QSI), it takes 18 years to progress through all the steps.

A QSI is awarded for outstanding performance and essentially allows the employee to move to the next step in a GS grade without waiting for the required number of weeks. A QSI does not affect the timing of an employee’s next regular WGI unless it moves the employee up into step 4 or step 7 of the employee’s grade level where there is automatically a longer waiting period.

Whether the step increase is given based on the time served by an employee or through awarding a QSI, the result is an increase an employee’s basic pay. Whether the award is a QSI or a standard WGI, the result is an increased cost to the agency on an ongoing basis. As a result, some agencies prefer to provide an exceptional employee with a lump-sum cash award. 

Here are the requirements that must be met for an employee to receive this additional step increase (QSI) without going through the usual waiting period:

  • must be below step 10 of the grade level;
  • has received the highest rating available under the agency’s performance appraisal system;
  • has demonstrated sustained performance of high quality; and
  • has not received a QSI within the preceding 52 consecutive calendar weeks.

If an employee has received a promotion, the promotion usually results in a person starting out in the new GS grade and going through the full waiting period before receiving the next WGI.

Can a WGI Be Denied?

It is understandable if federal employees consider a WGI to be an automatic pay raise to which they are entitled. In theory—if not, in fact—a WGI can be denied and should be denied if an employee is not performing at an acceptable level. The reality is different than the theory though and WGI’s are almost always awarded whether the employee deserves the raises or not.

MSPB Report on WGI’s

The Merit Systems Protection Board (MSPB) has issued a new report entitled “Determining an Acceptable Level of Competence for Step Increases.”

The MSPB made this observation about WGI’s and how they are used in agencies:

Survey results indicate that more than one in four supervisors believes they have at least one employee who is not at an acceptable level of competence. If each supervisor had 10 employees, that would suggest a WGI denial rate of at least 1 in 40.5 Personnel action data reflects a much lower actual rate, just over 1 in 1,000.

So, according to the MSPB, within-grade increases are denied at a rate of about one denial for every 1,000 employees.

It is theoretically possible that every employee in a large organization is performing at an acceptable level. But, according to the report, “the Governmentwide rate of WGI denials is inconsistent with Governmentwide survey results on the incidence of under-performance.”

In some cases, the level of performance is easier to measure and to make a decision on an employee’s performance. The report cites an example in the Department of State where “supervisors can easily determine whether an employee is performing successfully or unsuccessfully according to the performance standards.” In this instance, WGI’s were withheld at a rate that was ten times higher than for the rest of the agency where performance was not as easy to measure.

In most agencies, it is very easy to grant a WGI to an employee. Denying the increase takes more work and may involve a supervisor having to confront an employee about performance that is not acceptable. The employee also can appeal the denial of a WGI which can take more time, create more conflict, and create a tense atmosphere in the work environment.

The result seems obvious from the MSPB finding that there is only one denial for about every 1,000 federal employees. It is quicker and easier to pay an employee who is not performing at an acceptable level and, instead, award the employee a higher salary instead of confronting the employee and trying to improve that employee’s performance.

The reality is that denying a WGI is often part of firing an employee for unacceptable performance. In other words, while a supervisor is in the process of assisting an employee with improving performance, or in the process of taking a performance-based removal action, a supervisor often has to deal with denying a within-grade increase.

This is because if the supervisor provides the employee a WGI, which is theoretically based on the employee performing at an acceptable level, it becomes harder to fire an employee after certifying the employee performs at a high enough level to be awarded a pay increase.

The practical result is that if an employee is denied a WGI, it is often because the supervisor has decided that actually firing the employee is worth the time and trouble involved.

In fact, in some conferences I have attended, the advice provided to supervisors has been that the supervisor needs to understand the process before starting a removal action. In other words, the informal advice provided is not to bother denying a WGI unless a removal action is a next step.

The process of removing a federal employee is often complex, time-consuming, and litigious. Awarding a WGI and then trying to proceed with a removal action based on performance at a later time is generally not a wise course of action in most cases.

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

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