A 2.7% Federal Employee Raise in 2022?
As noted in several recent articles, a 2.7% pay raise for federal employees in 2022 is a good guess. 2.7% is still a guess as anything can happen between now and when the president issues an executive order affirming the final amount—usually at the end of the year before the raise becomes effective in January.
The most recent event is a new draft of appropriations legislation that was released on Wednesday, June 23rd. It is strange to refer to this as the next step in approving a 2.7% pay raise for next year. But, as the pay raise process goes, things are not always what they seem and this is no exception.
Why the Absence of a Pay Raise Amount is Significant
There is no mention of a federal employee pay raise in the new appropriations document. For those who are not familiar with the process, the absence of any reference to a specific pay raise percentage is significant.
In effect, the House Appropriations committee is deferring to the president’s recommendation of a 2.7% pay raise in 2022. Congress can legislate an amount different than what the president has proposed. So far at least, that has not been done.
So, while this is not a definitive step, so far the 2.7% pay raise is still on track.
As this article noted back in January, a bill was introduced to provide a 3.2% pay raise in 2022. While the bill is not insignificant, a bill such as this one is routinely introduced. Similar legislation has been introduced for the past several years. Last year, for example, a similar bill called for a 3.5% pay raise. Ultimately it did not pass, and federal employees ended up getting a 1% pay raise when the political process played out by the end of the year.
What About Locality Pay?
An additional amount of any pay raise for most federal employees is locality pay. Locality pay provides an extra amount of salary for federal employees in dozens of different geographic areas.
Oftentimes, there will be an announcement of an average pay raise percentage. But, while the overall average is often along the lines of 1.5%, federal employees in some areas will get an extra amount. Employees in areas such as Washington, DC or San Francisco, California may get an extra percent added into their pay because of locality pay.
For example, in 2021, a GS-12, Step 7 federal employee working in the Washington, DC area has an annual salary of $104,641. That same employee has a salary of $92,988 in 2021 if the employee is located in an area with the designation of “Rest of the U.S.”.
The recent draft legislation on appropriations does not reference any specific percentage for a federal employee raise or for a locality pay amount.
The amount of additional pay added in for locality pay is often not known until late in the process. Oftentimes, the average pay raise will be along the lines of 1.5% with an additional 0.5% for locality pay. The actual percentage for each locality varies and is announced by the Office of Personnel Management when the executive order ordering the pay raise implementation is announced.
When new events occur regarding the 2022 pay raise, FedSmith will advise readers to keep them informed. Sign up to receive our free newsletter on news impacting the federal workforce.