Trump Cancels 2019 Pay Raises for Federal Workers

President says federal workers’ pay should be performance-based

Stephen Miller, CEBS By Stephen Miller, CEBS August 31, 2018
Trump Cancels 2019 Pay Raises for Federal Workers

President Donald Trump said on Aug. 30 that he will invoke his emergency authority to freeze pay for civilian federal workers next year, citing strained federal budgets and the need to link workers' pay to their performance. Under current law, federal employees were set to receive a 2.1 percent across-the-board pay increase as well as location-based increases beginning on Jan. 1, 2019, but Trump said he is eliminating those raises and wants performance-based pay implemented for federal civilian workers.

Below is a roundup of resources and media reports with insights on this topic. 

President Calls for Performance-Based Pay

Trump, who has been critical of automatic pay increases, said in a letter to Speaker of the House Paul Ryan that federal workers' pay "must be performance-based, and aligned strategically toward recruiting, retaining, and rewarding high-performing federal employees and those with critical skill sets."

He added that "across-the-board pay increases and locality pay increases, in particular, have long-term fixed costs, yet fail to address existing pay disparities or target mission-critical recruitment and retention goals."

Federal Workers' Pay Raises Are Largely Tenure-Based

Using merit-based salary increases determined by performance reviews and variable-pay incentive bonuses to reward workers for meeting or surpassing annual goals has become common in the private sector. For federal workers, however, their pay is largely set by education and job position, with automatic increases over time based on tenure.

The White House 2019 budget plan released in February was the latest attempt to tie federal workers' pay to performance evaluations. The plan also called for revising policies that make it difficult to discipline and fire federal employees. Federal worker unions pledged to fight these reforms.
(SHRM Online)


[SHRM members-only toolkit: Designing and Managing Incentive Compensation Programs]  

Congress Could Restore Automatic Pay Raises

Congress could effectively override Trump's decision by including a pay raise in a spending bill, as long as the president signed the measure into law. A veto of a spending bill could lead to a federal government shutdown.

Federal employee groups, such as the National Active and Retired Federal Employees Association, have said that they intend to advocate for Congress to pass a version of government appropriations that includes the explicit pay increase for employees.
(Federal Times

Military to Receive Pay Raises

Trump's decision does not affect pay for military personnel; instead, U.S. troops are due a 2.6 percent pay increase next year. The raise came as part of a $716 billion defense spending bill that Trump signed earlier this month.

That measure, along with increased spending under a new two-year federal budget and tax cuts enacted at the end of last year, have led to accusations Trump is ignoring the federal deficit, despite promising he would address it as president.


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