Federal Salary Council proposes locality increase for 2012

Friday - 12/10/2010, 6:25pm EST

By Jason Miller
Executive Editor
Federal News Radio

The Federal Salary Council is recommending an increase in the locality pay rates for 2012 even though the Obama administration and Congress are working to freeze federal pay for two-years.

The council submitted its annual report Dec. 3 to the Office of Personnel Management, the Office of Management and Budget and the Labor Department suggesting a locality pay percentage of 41.77.

"We cannot calculate the percentage increase over the average of the rates authorized for 2011 at this time because the 2011 rates have not yet been set," the council wrote in its report.

The council recommended a locality pay increase of 40.87 for 2010 and 43.75 for 2011.

The locality pay for 2010 was different depending on the area of the country, but none reached the levels suggested by the salary council. For instance in Washington D.C. metro area, locality pay for 2010 was 24.12 percent.

The President told Congress late last month that there would be no locality pay increase for 2011.

The council report also recommends retaining the 32 existing locality pay areas, adding Alaska and Hawaii as separate whole-state locality pay areas, including the other non-foreign areas in the rest of the U.S. locality pay area.

Additionally, the council wants to create new locality pay areas for Albany, N.Y, Albuquerque, Bakersfield, Calif., Charlotte, N.C., Harrisburg, Pa., and Portland, Maine. The council also recommends adding Lansing, Mich., to the Detroit locality pay area.

For instance, the council found that federal employees living in Bakersfield make, on average, almost 59 percent less than those private sector counterparts.

"The pay gaps in Albany, Albuquerque, Bakersfield, Harrisburg, Lansing, Mich., and Portland are more than 5 percentage points higher than the rest of the U.S. gap in 2009 and in BLS test results for 2007 and 2008," the report states. "There are about 20,000 GS employees in these five locations. If these locations are made separate locality pay areas, OPM staff should adjust the rest of U.S. pay gap as we have done in the past to reflect this change…"

Should the locality pay be approved, the council predicts federal pay for GS employees would increase to $71.9 billion in 2012 from $70.6 billion in 2010.

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