On August 8, Delegate Eleanor Holmes Norton (D-DC) introduced legislation aimed at reducing federal employee pay compression. Addressing the pay cap and salary compression is an FMA issue brief, and FMA has endorsed the bill, alongside the National Treasury Employees Union and NARFE. The Federal Employee Pay Compression Relief Act (H.R. 5171) has three cosponsors and was referred to the House Oversight and Accountability Committee as well as the House Armed Services Committee.

In a statement upon introduction, Congresswoman Norton wrote the bill “would allow federal employees who reach the pay cap in their pay system to receive the base and locality pay adjustments they would otherwise be entitled to. Currently, federal employees who reach the pay cap do not receive such adjustments.”

While this issue has long impacted cities with high costs of living, such as San Francisco, Washington, D.C., and New York, an increasing number of localities are now impacted, and the issue gets worse every year. In 2022, Government Executive found there were “18 different locality pay areas where multiple steps within the GS-15 pay grade had reached the federal pay cap.” This is a recruitment and retention issue, and FMA will continue to work with Rep. Norton and others on the bill. To follow the progress of H.R. 5171, click here.

Separately, later this month, FMA will join other members of the Government Managers Coalition (GMC) on a call with senior staff from the Office of Personnel Management and the Office of Management and Budget to discuss pay cap and salary compression issues. President Biden’s FY 2024 budget proposal noted plans for his administration to offer a plan to address the issue this year, and the GMC is following up on the status of that effort.