NTEU Chapter 296
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  • President Issues Alternative Pay Plan for Calendar Year 2023
    Sep 05, 2022

    President Issues Alternative Pay Plan for Calendar Year 2023        

    SUMMARY:  Today, the President sent Congress a letter transmitting an

    alternative pay plan for the calendar year 2023 pay raise for federal workers that would institute an average 4.6% pay increase consisting of a 4.1% across-the-board increase and 0.5% for locality pay.  

                Today, the President sent congressional leaders a formal letter transmitting an alternative pay plan for the calendar year 2023 pay raise for federal workers in the General Schedule (GS) that would provide an average 4.6% pay increase for January 2023.  

                Under current law, the Federal Employees Pay Comparability Act (FEPCA), absent congressional action to establish a pay raise, the annual, across-the-board pay raise for most federal employees is set using a formula tied to the Department of Labor’s Employment Cost Index (ECI), which measures the rise in private sector pay.  Under the formula prescribed under this law, the ECI figure minus a half percent, the across-the-board pay increase should be 4.1%.  This amount is before any locality pay is added.  However, this same law also provides the President with the ability to set a different pay raise amount, which is required to be transmitted to Congress by September 1st of the preceding calendar year.  Today’s action formalizes the White House’s planned January 2023 pay increase as originally proposed earlier this year in the administration’s Fiscal Year 2023 budget request to Congress but provides additional details on how the increase will be allocated between an across-the-board increase and locality pay.  

    According to the alternative pay memo, the across-the-board increase will be 4.1% and 0.5% will be allocated for locality pay, resulting in an average increase of 4.6%, equal to the increase proposed for the military.

                It is still possible that Congress could act to provide a higher amount.  As of now, though overall FY 2023 congressional appropriations work remains incomplete as we near the start of the new fiscal year on October 1st.  As you may recall, the House-passed Financial Services and General Government (FSGG) appropriations bill, included in H.R. 8294, was silent on the issue of a federal employee pay increase, thereby deferring to the President’s proposal.  The Senate FSGG bill, which has not been considered by the Senate Appropriations Committee or the full Senate, was also silent on the issue of the federal employee pay increase for the GS. 

    While NTEU has always supported the concept of pay parity with the military, given the years of below market pay adjustment and the recent increase in inflation, we will continue to push Congress and the administration to support the FAIR Act (H.R. 6398/ S. 3518) and provide an average 5.1% increase for next year, consisting of an across-the-board increase of 4.1% and 1.0% for locality pay, which is particularly important for those living in high cost of living areas where the competition with the private sector for talented workers is more aggressive.  If the federal government wants to compete for top talent, it needs to offer competitive pay and benefits.  Given the low unemployment rate and the fact that the recently reported average pay disparity between the federal government and the private sector is 22.5%, Congress and the administration must do more.

    NTEU will continue to fight to ensure that federal workers receive a fair pay increase and will keep you updated on all administration and congressional developments that impact federal employee pay.  To find out more and see what you can do, click here.                       

    Anthony M. Reardon                                                           National President

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