Re-designation of Many Federal Employees for Higher Pay Zones
Many employees have been removed from their positions due to locality-based payments. It was planned and estimated by the evidence provided. According to the report provided by the U.S. Office of Personnel Management (OPM), many employees will be re-designated to an area of high locality for the year 2023.
This may apply to an estimated 32,000 employees. Each year, federal employees receive adjustments for their pay based on the Employment Cost Index for the workers of the private industries subtracting 0.5 percentage points. Therefore, allowance for locality-based pay would be made in areas where the difference in pay between federal and non-federal employees is much more than five percent.
New areas have been defined where the employees would receive the locality-based payments. Among the list of cities with new regulations, California, Fresno, Nevada, Rochester, New York, Washington, Reno, and Spokane will be the new locality pay areas. Also, many workers would be shifted to existing locality pay areas, the OPM said in the report.
Press Secretary Viet Tran said while stating to Federal Times that 85 percent of the federal workforce lives outside the area of D.C. Thus, the OPM is working to ensure that locality pay is competitive in every community throughout the country. Also, the Department of Labor and the OPM, has revised the Federal Salary Council recommendation to create four new pay localities, expanding the existing areas.
The federal Pay Agent has identified the areas with local pay discrepancies. Therefore, they have made some suggestions to the president so he can address them. It was created as a part of an annual review. The Secretary of Labor, along with the White House Office of Management, Budget, and OPM directors, have made up the president’s Pay Agent.
Furthermore, the changes that are in consideration to be made for locality pay areas are tentative and will only be approved once the suitable rule-making is complete to make these changes permanent. The timing for the rule-making has yet to be established. The modifications discussed for the locality pay area should be implemented from January 2024 at the earliest.
As per the Federal Employees’ Pay Comparability Act of 1990, the U.S. Bureau of Labor and Statistics has been asked to conduct a survey and collect data on salaried workers that are non-federal. The National Compensation Survey estimates the salary difference level of work from the occupational average as said by the reports. The Occupational Employment and Wage Statistics data indicates the average salaries of many occupations in every locality pay area. Moreover, the changes made for 2023 state that federal employees will see a salary rise across the board of 4.1%. Also, the average locality pay would increase to 0.5% from January.
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Bio:
Mickey Elfenbein specializes in working with Federal Employees relative to their retirement benefit plans, FEGLI, TSP, Social Security and Medicare, issues and solutions. Mr. Elfenbein’s mission is to help federal employees to understand their benefits, and to maximize their financial retirements while minimizing risk. Many of the federal benefit programs in place are complicated to understand and go through numerous revisions. It is Mr. Elfenbein’s job to be an expert on the various programs and to stay on top of changes.
Mickey enjoys in providing an individualized and complimentary retirement analysis for federal employees.
He has over 30 years of senior level experience in a variety of public and private enterprises, understands the needs of federal employees, and has expertise built on many years of high-level experience.
