Sponsors (37)
The bill modestly raises federal pay in 2026 to help employees and improve retention, but does so at increased payroll cost to taxpayers and with risks of uneven regional pay competitiveness and purchasing‑power gaps.
Federal employees (GS and other covered workers) receive higher take-home pay through a 3.3% across-the-board increase plus a 1% locality adjustment for 2026, reducing inflation erosion of wages.
Wage-grade (prevailing rate) workers get the 3.3% increase on schedule (no delay for wage surveys), ensuring timely higher pay for calendar/fiscal year 2026.
Federal agencies gain a modest boost in pay competitiveness (1% locality adjustment) that can help retain and recruit staff in higher-cost areas.
Taxpayers and federal budget outcomes face higher costs because the 3.3% and 1% pay increases raise federal payroll spending, which could increase near-term discretionary spending or the deficit if not offset.
Federal employees in high-cost areas may still see real-terms pay declines because a uniform 1% locality adjustment may not keep pace with local inflation or labor-market pressures.
Suspending the wage survey for prevailing-rate adjustments risks regional pay mismatches if local labor costs have shifted since the FY2025 baseline, potentially harming recruitment/retention in some localities (rural and urban).
Based on analysis of 3 sections of legislative text.
Introduced January 16, 2025 by Gerald E. Connolly · Last progress January 16, 2025
Increases federal employee pay for 2026 by setting a 3.3% across-the-board raise for statutory pay systems and prevailing-rate (wage‑grade) employees, and boosts the locality pay adjustment by 1% for 2026. The bill also suspends the normal FY2026 prevailing‑rate wage survey and applies the 3.3% increase to prevailing‑rate schedules in place at the end of FY2025. The change adjusts basic pay rates under existing pay statutes for calendar/fiscal year 2026; it does not create new programs or appropriate separate funding in the text and is implemented through current pay authorities and payroll processes.