Your $1.3 Blllion Pay Freeze Tab

If your federal office is located in Lansing, Albany, Albuquerque, Charlotte, Harrisburg, Pa. or Portland, Maine, congratulations. You must be very proud!

I haven’t been in Lansing or Portland, but I am assured they are nice places. But whichever one you call home there is good news. Also bad news…

The good news is that feds in those cities are in line for membership in the federal exclusive locality pay club. Workers in a locality pay area (like Washington-Baltimore, New York City, Houston, Los Angeles, San Francisco, Chicago, Philadelphia, Indianapolis, etc.) are paid better – in some cases much better than feds who are outside the locality pay loop. In governmentese that is known as RUS which stands for Rest Of The United States. If you work in Louisville, Las Vegas, Salt Lake City, Austin or San Antonio, Norfolk, etc., you are in RUS.

When federal pay raises are awarded each year all workers get the same national adjustment. But the president usually earmarks a portion of the national increase for locality pay. And those increases are determined by an incredibly complicated formula designed to measure the pay “gap” between feds in those locality pay areas and private sector workers doing similar jobs in the same place.


Because of locality pay, workers in Washington-Baltimore often get the largest increases – in part because the private sector in the DC area is booming while the rest of the country is treading water or losing ground. Because of locality pay, feds in NY, LA-San Francisco and Houston make more money than their colleagues in Cincinnati (a locality pay area) or San Antonio, which is outside the loop in RUS.

All of the above is the good news. Folks in those areas are either going to have, or have been nominated to have their own locality area. Meaning bigger raises in the future, except…

The bad news: The President has proposed and Congress has approved a two-year freeze on federal pay. When that kicks in, your next pay raise (in most instances) will not be due until January, 2013. If then. You will still get within-grade raises (3 percent for time in grade) and you will be eligible for pay raises accompanying promotions. But regular pay raises, no way!

So what does the pending pay freeze mean to you? Well for starters, you won’t get the 1.4 percent amount the President originally proposed for January, 2011. Or the 1.9 percent your friends on Capitol Hill sought to give you pay raise parity with the uniformed military. That, plus whatever you would have gotten in January 2012. You can crunch the numbers to see what it means to you as an individual. Overall, it is estimated that the 2-year pay freeze will hold nonpostal federal pay to its current $70.6 billion level, rather than the $71.9 percent it would have hit had regular pay raises been allowed.

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Nearly Useless Factoid
by Suzanne Kubota

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