Almost all federal employees will receive a 1 percent raise under an order President Trump issued late Thursday that ends months of back-and-forth over pay for the 2.1 million executive branch workers.
The increase, to take effect Sunday with the start of the first biweekly federal pay period of the year, will be paid across the board to General Schedule employees, in contrast with the previous raises paid under the Trump administration, which varied somewhat by locality.
While a separate pay system, also locality-based, applies to blue-collar employees, for many years their increases have been capped at the local General Schedule amount. The budget bill that Trump signed into law Sunday continued that policy for 2021.
That measure took no position regarding a raise, in effect backing the 1 percent amount in Trump’s budget proposal in February. Under the complex federal pay law, if no number is enacted into law by the end of a year, the White House’s proposed raise takes effect automatically.
However, the outcome was uncertain because the administration in the meantime had advocated for a freeze, citing “budgetary constraints and the recent, pandemic-related impacts on non-Federal labor markets.”
The raise will be the smallest of the four paid under the Trump administration, following boosts averaging 1.9, 1.9 and 3.1 percent.
The order will increase to $172,500 a salary cap that applies to employees in the uppermost levels of the General Schedule in some areas, including the Washington-Baltimore area. For most career executives and others at senior career levels, a cap of $199,300 will apply; most of them are paid within a range and receive raises based on performance ratings.
The raise will not apply to senior political appointees nor to U.S. Postal Service employees, whose pay is determined in bargaining.
A separate cost-of-living adjustment of 1.3 percent will be paid to most federal retirees effective this month, the same increase going to Social Security beneficiaries and military retirees. That increase was determined in October based on an inflation measure.
The executive order also finalizes a 3 percent raise for active-duty military personnel contained in the recently enacted budget bill, effective Jan. 1.