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The big news on the pay raise this week was no news.

Huh? Here’s the deal…

A Senate Appropriations Committee took no specific action this week on a pay raise for federal employees next year. Because President Trump has recommended a 2.6% raise, that means the Senate deferred to the president’s proposed raise.

Congress can override the president’s recommendation, but by taking no action, the raise next year will default to the recommendation from the White House.

The House, however, had previously passed legislation authorizing a 3.1% pay raise in 2020. If the House and Senate cannot reach agreement on legislation that gets passed into law, again, it will defer to the president’s recommendation.

So what this means for federal employees is that it is not a question of if, but rather how much, their raise will be next year. The difference between what the House passed and what the president is proposing boils down to locality pay: the president’s proposal would keep locality pay at current levels while the House bill authorized a 0.5% increase for locality pay.

What About Federal Retirees?

One question that always comes up when we cover this topic is retired federal employees will ask, “What about our COLA next year?”

The answer is always the same: the pay raise process has no bearing on federal retirees. The cost of living adjustment is determined by an automatic formula whereas the president and Congress determine a pay raise for current federal employees through the political process each year.

The final COLA figure for the next calendar year comes out in October, so we will be covering that in an article as soon as it’s released by the Bureau of Labor Statistics to let federal retirees know how much of a COLA they can expect in 2020.

To read greater detail on the differences, be sure to check out How is the Annual COLA Different from an Annual Pay Raise?.