The 2021 omnibus spending package, which Congress unveiled Monday and plans to vote on the same day, would give federal employees and members of the military a longer timetable for paying back the payroll taxes that were deferred for the last few months of 2020.
Federal employees saw slightly larger paychecks during the final pay periods of the year as part of an executive order signed by President Donald Trump in early August. Those extra funds came from deferring but not cancelling normal Social Security deductions taken out of each paycheck.
And though most of the private sector opted not to participate in the program, federal employees and members of the military were automatically enrolled, a move that angered members of Congress and federal employee groups for simply shifting the burden of those payments from one part of the year to another, without the ability to opt out of the program.
Some proposed legislation attempted to remove feds from the program altogether, unless they proactively chose to participate. But as paychecks have continued to receive deferrals without progress on the bill, the 2021 funding legislation instead gives those employees until Dec. 31 to pay back the taxes, rather than April 31.
“NTEU was concerned that requiring employees to pay the deferred taxes in just four months was too short and would present a financial burden to federal employees, especially because they were forced to participate in the deferral with little or no notice,” said National Treasury Employees Union National President Tony Reardon in a statement.
“NTEU commends Sen. Chris Van Hollen of Maryland and other congressional allies who fought to give federal employees more time. The amount of deferred taxes will be withheld over 26 pay periods instead of eight, which is a fair resolution to a shortsighted policy that only affected civilian and military federal employees in the executive branch, and no one else.”
The finalized spending bill also notably did away with Senate provisions that would have frozen federal pay at 2020 levels, deferring the question of pay to Trump’s proposed 1 percent increase in February budget documents.
Trump would still need to sign an executive order to implement the pay raise.
“By deferring to the president’s initial proposal, Congress wisely rejected last-minute attempts from Senate Republicans and President Trump to freeze employee pay next year. However, this raise does little to alleviate the 23 percent pay gap that exists between federal employees and their private-sector counterparts,” said Reardon.
Also absent from the bill are provisions to prevent the implementation of a new Schedule F excepted service in the federal government, a move by Trump to transition policy-focused federal employees into a classification that has fewer protections for hiring and firing of individuals.
“I’m extremely disappointed that Republicans blocked the inclusion of language to reverse President Trump’s cynical Schedule F executive order in the latest government funding legislation. The Trump administration’s decision to reclassify thousands of civil servants in order to make it easier to fire and replace them with partisan individuals ought to alarm all Americans,” said Rep. Steny Hoyer, D-Md., in a statement.
“Reports that agencies are moving forward with this order in the waning weeks of the Trump administration are deeply alarming, and would seriously harm the ability of our government to serve its citizens. I’ll work with the incoming Biden-Harris administration to reverse this harmful order and undo President Trump’s attempts to undermine the federal civilian workforce.”
Though an incoming Biden administration can — and likely will — reverse the order, it is possible for Trump administration-led agencies to reclassify some jobs during the intervening time and place those employees at greater risk of being removed from government service.
Although silent on the new job schedule, the 2021 funding legislation does task the Office of Personnel Management with establishing a new occupational series or updating an existing one to account for the skills an competencies needed for artificial intelligence jobs. The agency will also be expected to produce a count of all current AI-focused feds and projections on how those ranks may grow over the next five years.
Jessie Bur covers the federal workforce and the changes most likely to impact government employees.