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WASHINGTON – Federal employees would receive an average 4.3 percent pay increase next year under legislation introduced today and endorsed by the National Treasury Employees Union.

 Passing the Federal Adjustment of Income Rates (FAIR) Act, sponsored by Sen. Brian Schatz of Hawaii and Rep. Gerry Connolly of Virginia, would be a positive sign that lawmakers value the civil service and the work it does on behalf of the American people. 

 “Federal employees swear an oath to uphold the Constitution and perform the day-to-day work of our federal agencies, and they deserve the pay increase outlined in the FAIR Act," said NTEU National President Doreen Greenwald.  "All Americans grapple with the rising costs of health care, housing and basic living expenses and federal employees are no different, which is why NTEU strongly supports this legislation.”

 The proposed raise consists of a 3.3 percent across-the-board increase plus an average 1 percent for locality pay. About 85 percent of all federal employees live and work outside of the Washington D.C. region, so a raise will improve federal paychecks and boost the economy in every city and state across the country. 

“We have union members who know full well they could make more money in the private sector but they instead prefer to put their talents to work for the public good,” Greenwald said. “They deserve fair compensation and to be treated with dignity and respect.”

Federal employees on average earned 24.72 percent less in 2024 than workers in similar private sector jobs, according to government data released by the Federal Salary Council. And in 2025, they will pay on average 13.5 percent more for health insurance than they did in 2024, according to the Office of Personnel Management.

The 3.3 percent across-the-board raise is called for under the Federal Employees Pay Comparability Act of 1990 and is based on the annual increase in the Employment Cost Index. 

“As part of our merit-based civil service, frontline federal employees are responsible for the nation’s security, protecting the public health and ensuring economic fairness and prosperity,” Greenwald said. “A fair pay raise in 2026 is a necessary investment to ensure skilled professionals continue to deliver government services.”

Rep. Connolly also introduced the Equal COLA Act that is endorsed by NTEU.  This bill would eliminate the disparity between cost-of-living increases for Civil Service Retirement System and Federal Employee Retirement System retirees when inflation is more than 2 percent.

NTEU represents employees in 37 federal agencies and offices.