December 31, 2003

Bush sets 2004 pay raise at 2 percent

By Amelia Gruber

President Bush on Dec. 30 ordered a 2 percent 2004 pay raise for civil servants, but government workers may eventually receive a significantly higher raise if lawmakers approve the pending fiscal 2004 omnibus budget bill.

In an executive order issued on Dec. 30, Bush called for a 1.5 percent across-the-board raise for civilian white-collar federal employees and a 0.5 percent increase in locality-based pay.

Lawmakers would like to grant civil servants the same raise as uniformed military service members, but Bush has said that such an increase would be too costly and would divert needed resources from the war on terrorism.

Bush requested a 2 percent salary boost for white-collar federal employees and a 4.1 percent raise for military employees in his 2004 budget proposal. He reiterated his stance on pay parity in a August letter explaining his decision to give civil servants a 2 percent pay increase on average, rather than the substantially higher boost due under the 1990 Federal Employees Pay Comparability Act.

But lawmakers could have the final word on the 2004 pay raise. Congressional negotiators included a 4.1 percent pay raise both for civil servants and military service members in the fiscal 2004 omnibus appropriations bill. The House approved the omnibus conference report on Dec. 8, but the Senate has yet to consider the legislation. Senators will return from recess on Jan. 20.

House Minority Whip Steny Hoyer, D-Md., a supporter of pay parity, said Wednesday that he is "disappointed that the president continues to insist that federal employees should receive half of what a bipartisan majority in Congress has approved." Hoyer urged lawmakers to pass the 4.1 percent pay raise in the 2004 omnibus bill as expediently as possible and asked them to make the pay raise retroactive to the first of the year.

"Federal employees, who generally earn less than their counterparts in private industry, have a right to know what their paychecks will be so they can plan their household budgets," Hoyer said.

Last year Bush granted white-collar civil servants a 3.1 percent across-the-board pay raise, with no increase in locality pay. But Congress overrode his Dec. 31, 2002 executive order by including a 4.1 percent raise in the fiscal 2003 omnibus spending package passed in February. The 4.1 percent raise applied for all of 2003, but some employees had to wait several months to receive the retroactive portion.

A similar situation will probably develop when Congress passes the 2004 omnibus bill, National Treasury Employees Union President Colleen Kelley said Wednesday. Bush's executive order is "extremely disappointing" and will force agencies to calculate pay twice in the same month once the omnibus passes, "resulting in an enormous waste of taxpayer money," she said.

"All of this delay and additional expense is both damaging to employee morale and completely avoidable," Kelley said. "I do not understand why this administration chooses to denigrate the work and value of federal employees in this way year after year."

Visit the Office of Personnel Management Web site to view draft 2004 pay tables. Please note that these tables may change if Congress grants a larger pay raise in the final fiscal 2004 omnibus spending package.