In A Letter to Senators, Kelley Slams Proposal To Extend Pay Freeze, Slash Federal Workforce

Press Release December 1, 2011

Washington, D.C.—A proposal by Senate Republicans which indicates a clear determination to fund a payroll tax holiday on the backs of middle-class federal workers while shielding the wealthiest among us from any sacrifice at all drew sharp criticism today from the leader of the nation’s largest independent union of federal employees.

In a letter to senators, President Colleen M. Kelley of the National Treasury Employees Union (NTEU) said the proposal introduced by Sen. Dean Heller (R-Nev.) is “extremely unjust” in targeting for further sacrifice federal employees who are struggling to make ends meet in the current economic climate.

She added: “Whether defending our borders, protecting investors, safeguarding the environment from contamination, keeping our food, water and medicines safe or processing tax refunds, federal employees are doing work that is critical to the American way of life. Making arbitrary reductions to the federal workforce would only diminish many key services the American people depend on.”

She called on senators to reject such proposals as an extension of the current two-year federal pay freeze to five years and allowing only one employee to be replaced for every three who leave the federal workplace.

“NTEU strongly urges you to oppose any attempts to offset the cost of the legislation by further freezing the pay of federal employees for a total of five years, imposing a one-for-three-hiring freeze, and reducing agencies’ ability to deliver services by reducing their budgets below the agreed-upon level in the debt ceiling agreement as proposed by Sen. Heller in S. 1931,” the NTEU leader wrote.

Separately, Kelley expressed surprise and disappointment “that the Republican leadership would take this tack of targeting middle-class workers in favor of millionaires. It goes against the strongest public sentiment, and makes little economic sense.”

She added: “A key purpose of the payroll tax holiday is to stimulate the economy by allowing middle-class workers, who are most likely to spend any excess cash, to keep more of their earnings. Freezing pay and cutting jobs of other middle-class workers to offset this tax reduction completely eliminates any positive impact on our struggling economy.”

NTEU, she said in her letter, supports the approach of requiring the wealthiest Americans to make some sacrifice in the current economic environment. The Republican alternatives “would single out one small group of middle-class workers—our federal employees—to pay for a tax cut for other middle-class workers, in order to protect the wealthiest Americans from bearing even a small sacrifice.”

With regard to the Heller proposal, President Kelley said it “makes clear that Senate Republicans stand firmly on the side of the wealthiest Americans, and are turning their backs on middle-class families. This is clearly a cynical, politically-motivated gesture, which, it appears, is aimed at currying favor with the 1 percent, because it is not going to win support from the average worker.”

She noted, as well, the irony that nearly 600,000 mostly older federal workers are not themselves eligible for any payroll tax reduction because they pay into a federal retirement system that does not include Social Security.

These employees instead pay 7 percent of their salary toward their Civil Service Retirement System (CRSR) pension, she said, calling on the Senate to include a provision to address this serious inequity by providing a tax credit to these employees equal to the payroll tax reduction.

The NTEU leader also pointed out that through the two-year pay freeze, which runs to the end of 2012, federal employees will have made a contribution of $60 billion over 10 years to efforts to reduce the federal deficit. “Freezing federal pay farther and farther into the future and cutting agencies’ ability to provide needed services to the public without asking the wealthiest Americans to share in the sacrifice at all is not what the majority of Americans want,” she added.

As the largest independent federal union, NTEU represents 150,000 employees in 31 agencies and departments.

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