RS21689 -- Federal Pay - Status of January 2004 Adjustments: A Fact Sheet
Updated January 24, 2004
Summary
Federal pay adjustment rates going into effect in January 2004, under Executive Order
13322 (69 Federal Register
231) were less than those in the pending Consolidated Appropriations Act, 2004 (H.R. 2673). The General
Schedule (GS) and related salary
systems were limited to 2.0%, as opposed to the 4.1% subsequently passed. Salaries of officials in the three
branches were temporarily limited, due to the lower
GS rate, to 1.5%, rather than the scheduled 2.2%, which upon Presidential approval of H.R. 2673, will go into effect
retroactively.
Status of General Schedule Pay Adjustment
(1)
- Under 5 U.S.C. 5303, General Schedule basic salaries, and those of other related statutory systems, are to be adjusted the first pay period
beginning on or after January 1 of each year (January 11, 2004). The adjustments are determined by the change in
the private sector element of the Employment
Cost Index (ECI) from September to September. The percentage of change, minus 0.5%, becomes the scheduled
rate of adjustment. For January 2004, the rate
of adjustment was scheduled at 2.7%. Locality-based payments are determined separately, based on wage survey
data from 32 geographic
areas.
- Under 5 U.S.C. 5303 and 5 U.S.C. 5304, President George W. Bush sent forward an alternative plan in August 2003 that called for a 1.5%
increase in General Schedule, and related systems, basic pay and an average of 0.5% in locality-based payments for
January 2004.
- Barring any action by Congress to establish a different rate or effective date, the President's alternative plan will
govern.
- Both the House and Senate voted to establish a 4.1% pay adjustment, effective January 2004. (2)
- With passage of the 4.1%, the basic pay adjustment will be the scheduled ECI adjustment of 2.7% and the locality pay adjustment will
average 1.4%. For the Washington, DC, area, the net adjustment will be 4.41%.
Status of Pay Adjustments of Officials (3)
- Under Section 704, P.L. 101-194, the Ethics Reform Act of 1989, salaries of Members and officers of Congress, federal judges, and
executive branch officials on the Executive Schedule (collectively referred to herein as "officials") are to be adjusted
annually based on December-to-December
percentage changes in the private sector element of the ECI, effective in the same month as the GS
adjustments.
- The scheduled January 2004 pay adjustment, based on the ECI, is 2.2%.
- Section 704, as amended, stipulates that officials' pay adjustments cannot exceed the rate of adjustment for GS basic
pay.
Effect of Delayed Passage
- GS pay adjustment in January 2004, pending presidential approval of the FY2004 Consolidated Appropriations Act, is limited to 1.5% for
basic pay and an average of 0.5% for locality. The net adjustment for the Washington, DC, area has been 2.12%
(Executive Order 13322, 69 Federal Register
231).
- The pay adjustment for officials has been limited to 1.5%.
- Upon approval of the Consolidated Appropriations Act, 2004, GS pay will be adjusted to a total of 4.1%, retroactive to the first pay period
beginning on or after January 1, 2004, with the rate of 2.7% for basic pay. Salaries of officials will increase to the
2.2% rate,
retroactively.
Footnotes
1. (back)For a more detailed discussion of both
basic pay and locality-based payments, see CRS Report RL31823, Federal White-Collar Pay: FY2004 Salary
Adjustments, by [author name scrubbed].
2. (back)H.R. 2989, Transportation, Treasury,
and General Government Appropriations Act, 2004, the provisions of which are found at Division F;
H.R. 2673, Consolidated Appropriations Act, 2004, see Section 640 for the pay provision.
3. (back)For current and projected rates of pay for
officials, see CRS Report 98-53, Salaries of Federal Officials, A Fact Sheet, by [author name scrubbed].