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Washington D.C.—The House of Representatives today approved a 3.5 percent pay increase for federal civilian employees and voted against an attempt to remove legislative language that imposes limits on federal contracting as lawmakers passed the Financial Services and General Government Appropriations bill for fiscal 2008.

The NTEU-supported 3.5 percent pay increase for federal employees matches the amount previously approved by the House and the Senate Armed Services Committee for members of the military.

President Colleen M. Kelley of the National Treasury Employees Union (NTEU) lauded the House vote. “Fair pay is the single most important factor toward recruiting and retaining quality federal employees,” she said. “It also would represent a small, but important, step in closing the pay gap between public and private sector employees, estimated at about 13 percent.”

In years past, federal employees and members of the military have received pay increases equal to the Employment Cost Index (ECI), plus one-half of one percent. Using that formula would lead to a raise of 3.5 percent for next fiscal year, not the 3 percent proposed by the administration. NTEU also secured language ensuring that administration efforts to change pay systems at the Department of Homeland Security (DHS) and Department of Defense (DOD) would not prevent the 3.5 percent January pay raise for employees in those departments.

In addition to a pay hike, the approved legislation levels the playing field in federal contracting out competitions despite an attempt on the floor to remove the provisions from the bill. The attempt was defeated 268 to 158. It expands federal employee appeal rights in A-76 procedures, giving them the same rights presently enjoyed by private contractors to appeal agency decisions privatizing federal work. NTEU has long argued that federal workers should have the same right to appeal to the Government Accountability Office (GAO) – as an independent decision-maker – that private contractors have. Under present contracting rules, federal employees are limited to an appeal within their agency; the same agency which makes the A-76 decision in the first place.

The bill’s language also precludes private companies from reducing employee health benefits, or offering inferior retirement benefits, in order to reduce costs on their final contract bid. Finally, the legislation mandates that the Office of Management and Budget (OMB) cannot require or direct agencies to undertake A-76 competitions. The bill makes these provisions permanent changes in law.

NTEU is the largest independent federal union, representing more than 150,000 employees in 31 agencies and departments.