Diplomatically Trying to Close Overseas Pay Gap

By Joe Davidson
Wednesday, November 19, 2008

Michael Keller has worked on five continents during his 15 years in the foreign service. He's been in Germany, where the standard of living is pretty good, and the Central African Republic and Cambodia, where he could only hope that his three children suffered nothing more than bumps and bruises because of poor medical care.

He likes his work, but he's always confronted with a big source of frustration -- the overseas pay gap.

When State Department diplomats are posted abroad, they lose locality pay. That's the amount added to a federal worker's salary based on where they work.

Since 1994, when locality pay started, the increase for federal employees in the D.C. area has amounted to almost 21 percent. Moving overseas from the State Department's Foggy Bottom headquarters and other area installations means workers lose that differential.

"It doesn't fundamentally undercut my commitment to the career," said Keller. Currently he's the director of economic and commercial studies at the National Foreign Affairs Training Center in Arlington, but he was speaking for himself.

"I didn't join the foreign service for the pay."

But neither man nor woman can live on the love of public service alone.

Money helps.

There is support, on Capitol Hill and in the administration, for legislation that would close the gap. Committees in the House and Senate have approved such measures.

"We have always supported reducing or eliminating the pay gap between what people receive in domestic positions versus what they receive overseas," said Linda Taglialatela, a deputy assistant secretary of state.

But that support has not moved Sen. Tom Coburn, the Oklahoma Republican physician also known as "Dr. No." He's earned that nickname because he relentlessly uses a Senate procedure to hold up bills that require additional federal spending unless the legislation provides money to pay for its project.

"Congress should be focused on improving conditions of workers who have lost their jobs or may lose their jobs and not on handing out huge raises to foreign service officers who already receive very generous benefits overseas," said John Hart, Coburn's communications director.

That kind of talk could make a diplomat get very undiplomatic.

But John Naland, president of the American Foreign Service Association, knows how to keep his cool (which should come in handy when he's transferred to Iraq next year).

Closing the gap is not a pay raise, he said calmly. "It's fixing an unintended inequality."

Naland doesn't quarrel with Coburn's right to oppose legislation closing the gap, "but his hold is preventing his 99 colleagues from voting," Naland said. "That's just the way the Senate works nowadays."

He does quarrel, however, with Coburn's notion that foreign service officers are seeking huge raises on top of other big benefits. It's true that diplomats get a housing allowance and, in some cases, dangerous duty or hardship duty pay. But that doesn't negate the need to close the gap, especially for lower-level diplomats.

Senior foreign service officers get those same benefits, but their pay is not reduced by the locality amount when they go abroad. That cut applies only to the junior and mid-level diplomats.

Furthermore, Naland said, the "allowances were never meant to obviate the need for the basic locality pay adjustment that all other federal employees get."

That's what upsets foreign service officers -- working cheek by jowl with colleagues from the CIA, who might pretend to be foreign service officers, and other agencies whose pay is not cut when they leave the D.C. area.

"It becomes an equity issue," Keller said.

And foreign service officers don't have the option of staying in D.C. They spend most of their careers outside the country.

The issue is compounded when a diplomat takes his family abroad because the family often loses the spouse's income, too. Sonja Keller had a growing career as a journalist and public relations officer when Michael was sent to the Central African Republic.

"The financial impact was significant," she said.

Her income was greater than his, but the family had to give that up.

"Once I left my job, my career basically stopped," she said.

She worked in embassies where her husband was posted, but it was "generally nominal stuff," she said.

That's not the kind of information that would attract potential foreign service officers, even if they were driven by public service more than big bucks. It also makes folks like Keller wonder if they should stay in the foreign service, when their retirement funds are being shortchanged by the current pay system.

"Will it affect how long I stay in? Quite possibly," he said. "I could leave sooner rather than later."

Nobody becomes a diplomat to get rich, but no one wants to be on the short end of a system with built-in pay inequality.

Contact Joe Davidson at federaldiary@washpost.com.