Legislation that has been reintroduced in both the House and Senate this week would increase the salaries of some federal employees by correcting a pay disparity between hourly and salaried that exists because of how locality pay boundaries are applied.
The Locality Pay Equity Act is being reintroduced in the House (H.R. 3086) by Congressman Matt Cartright (D-PA) and in the Senate (S. 1561) by Senator Bob Casey (D-PA). Efforts to pass the bill date back as far as 2013 but to date none have come to fruition.
What Would the Bill Do?
The purpose of the legislation is to ensure that there is only one Federal Wage System (FWS) (i.e. wage grade) local wage area within a General Schedule (GS) locality pay area. The federal government currently treats hourly and salaried workers who work in the same location as if they worked in different locations when it comes to calculating locality pay rates. The bill would apply the pay boundaries for salaried employees to hourly workers. This would only raise the wages of hourly employees; it would not affect the salaried employees in any way.
One example of this scenario hits home for both lawmakers since it impacts employees who work at the Tobyhanna Army Depot. Cartwright says that the discrepancy in how the local pay rates are calculated between the hourly and salaried workers has led to “a significant pay gap at the Tobyhanna Army Depot.”
The net result of the pay disparity is that wage grade (FWS) employees at Tobyhanna receive an increase based on the Rest of U.S. (RUS) GS locality pay area. In contrast, the employees under the GS pay scale working at Tobyhanna fall under the New York City GS locality pay area, one which typically receives a larger pay adjustment than does the RUS locality pay area.
“There’s no reason we should be using two different sets of pay boundaries, especially when it results in such an unfair wage gap,” said Cartwright. “Senator Casey and I agree that it’s time to fix this outdated system. This is a simple solution that ensures all Tobyhanna employees are paid fairly for their work, regardless of whether they are paid a salary or by the hour.”
AFGE National President Everett Kelley said in a statement, “Currently, salaried and hourly federal employees can work side-by-side in the exact same location yet be treated as though they work in different locations when it comes to determining their locality pay. Federal employees in the skilled trades commute along the same routes and face the same living costs as their salaried coworkers, and there is no rational reason why the government pretends they are in different locations once they arrive at work.”
Federal Wage System vs. General Schedule
What are the main differences for setting rates of pay under the two systems?
According to the Office of Personnel Management, the Department of Defense (DOD) is the lead agency responsible for issuing FWS wage schedules. OPM does not conduct local wage surveys. Pay is based on what the private industry is paying for comparable levels of work in a local wage area.
The GS pay scales, on the other hand, are determined by surveys of non-Federal employers (including State and local governments). In the locality pay program, pay for federal employees under the General Schedule is compared to non-Federal pay for the same levels of work. The President’s Pay Agent and the Federal Salary Council make recommendations for locality pay areas and rates in their annual reports.