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Washington, D.C.—President Colleen M. Kelley of the National Treasury Employees Union (NTEU) today applauded the administration’s decision to designate the additional one percent pay raise for 2003 as locality pay, as NTEU had urged. Earlier this year, NTEU led the successful fight for a 4.1 percent federal civilian pay raise in the face of the administration’s initial proposal for a sharply lower raise for its civilian workforce.

Although belated, the president’s executive order assigning the additional one percentage point to locality pay is a welcome development, the NTEU leader said, calling it “a small step forward” in recognition by the government that higher pay is vital to recruiting and retaining the high-quality civilian employees it needs. The executive order follows the recommendation of the Federal Salary Council, of which President Kelley is a member.

President Bush initially proposed only a 2.6 percent civilian pay raise for this year, in contrast to the average 4.1 percent he proposed for members of the military, and ultimately set a pay raise of 3.1 percent for civilian employees. Working with members of Congress, NTEU pushed hard, and successfully, for a continuation of civilian-military pay parity. Congress approved the 4.1 percent civilian pay raise for this year as part of the omnibus appropriations bill signed into law Feb. 20. The

raise is retroactive to the first pay period in January.

It took four weeks for the president to issue the executive order allocating the additional one percentage point to locality pay, which is designed to reflect the gap between private and public sector pay in various locations around the country.

Locality pay was established by the 1990 Federal Employees Pay Comparability Act (FEPCA), which was designed to close, in stages over 10 years, the public-private sector pay gap. The law has never been implemented as intended, and today, depending on location, the pay gap ranges as high as 32 percent.

Civilian-military pay parity again in 2004 is a NTEU priority. The administration’s budget proposal calls for a civilian pay raise of only two percent next year, while proposing an average 4.1 percent raise for the military.

“NTEU has long supported higher pay for members of the military, and continues to do so,” President Kelley said, adding that “it is both smart and fair for the government to raise the pay of its dedicated civilian employees—many of whom are working on the front lines of homeland security—by a similar amount.”

Both the House and Senate Budget Committees have included in budget resolutions their recommendations for civilian-military pay parity in 2004.

Higher civilian pay is not only key to addressing the government’s growing recruitment and retention problems, President Kelley said, but is central in sending the important message for federal civilian employees that their contributions and professionalism are both wanted and valued.

NTEU is the largest independent federal union, representing some 150,000 employees in 29 agencies and departments.