Are you underpaid?

If you’re feeling underpaid, there’s a good chance you may have to wait a little longer for a raise. In a recent budget document regarding the 2019 fiscal budget proposal, the Trump administration has confirmed its leaning towards a pay freeze for federal civilian employees. The last government pay freeze was under the Obama administration lasting from 2011-2013 for budget purposes, as well.

According to the administration, the General Schedule pay scale is out of date and needs reform. Created in 1949, with no major changes or updates since, raises have been paid based on one’s longevity in a position verses their performance. In a testimony before the House Appropriations subcommittee, Mick Mulvaney, OMB Chief, advocates his support for pay scale reform, stating it’s simply not fair to give the same raise to lower performing workers as high performing workers. According to the data known on performance and pay, “we over-pay at the lower level and under-pay at the upper levels.”

By focusing on employee performance, Mulvaney has high hopes that awarding an incentive to highly skilled individuals would help recruitment and allow government jobs to better compete with the private sector.

In part of the freeze, the administration is looking to set up a $1 billion government-wide performance pay pool, which would be to spread percentage increases to top performers instead of equally among employees. There has been push back on the idea, arguing this method would discourage workers and people outside of the government to join the workforce.

It’s important to mention that the budget will also affect federal benefits and retirement benefits. From leave and sick days to defined contribution benefits, employees should expect cuts and major adjustments in an effort for the Government to reduce the deficit over the coming decades. To learn more about how the proposal could potentially affect you, visit www.myfedlife.com.

MFN 50 (5/2018)

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