Here’s what still needs to happen for feds to get their 2023 pay raise

There are several more steps in the process before the extra money will appear in paychecks.

There are several more steps in the process before the extra money will appear in paychecks. Liliboas / Getty Images

Although there’s only a month left in the year, there are still a number of things that must be done to finalize an average 4.6% pay hike for civilian federal workers in January.

With less than two weeks remaining before a deadline to keep the government open and about a month left until the end of Congress’ term, pressure is mounting on lawmakers to reach last-minute deals on fiscal 2023 appropriations and the annual defense policy bill. But that also means there’s just one month left for Congress and the White House to act to ensure federal employees receive a pay raise next year.

President Biden initially proposed an average 4.6% pay increase for civilian federal workers in 2023 as part of his fiscal 2023 budget request last spring, split between a 4.1% across-the-board increase in basic pay and an average 0.5% boost to locality pay. Biden formalized that figure when he released his alternative pay plan in August, an annual document that the White House publishes to prevent much larger automatic increases to locality pay from taking effect in accordance with the Federal Employees Pay Comparability Act.

But federal employee groups and some Democratic lawmakers have urged the administration to adopt a more generous raise of 5.1%—split between a 4.1% increase in basic pay and an average 1% increase in locality pay—given the recent upticks in both inflation and federal workers’ health insurance premiums through the Federal Employees Health Benefits Program.

Thus far, those calls have been met with silence. Biden’s pay plan has remained at an average raise of 4.6%, and when the House passed its appropriations bills last summer, it declined to weigh in on federal worker compensation, effectively endorsing the White House plan.

Although congressional leaders remain in negotiations on an omnibus spending package that would avert a government shutdown and fund the government through next September, it seems unlikely that Congress will ultimately override Biden’s proposal and offer a more generous pay increase, given the House’s previous inaction on the topic.

However, the administration still must take some additional steps to ensure that the pay raise is implemented in time for the first paychecks of 2023 to be sent out. First, Biden must issue an executive order finalizing his alternative pay plan before the end of this year.

Then, once that edict is issued, the Office of Personnel Management must publish new pay tables incorporating the pay raise at every level of the General Schedule and for each locality pay area, and including recently finalized tweaks to existing locality pay areas, such as the addition of Carroll County, Ill., to the Davenport, Iowa, locality pay area.

Once those actions are taken, the pay raise will go into effect for the first full pay period of 2023.