Human Capital: Administration and Implementation of the General Schedule Locality Pay Program

What GAO Uncovered

To help decide the locality-dependent pay back adjustments for federal staff members paid beneath the Standard Routine (GS) fork out method, the Federal Employees Fork out Comparability Act of 1990 (FEPCA) made the President’s Fork out Agent (Pay Agent) and Federal Salary Council (council) to every year advocate locality pay out amounts to the President and modifications to locality shell out parts (see determine below).

Yearly Approach for the Common Program Locality Pay Plan

aSelected by the President, the Shell out Agent is comprised of the Secretary of Labor and the Administrators of the Business of Management and Budget and OPM. The council is comprised of a few industry experts in labor relations and pay out policy and 6 representatives of worker companies symbolizing big quantities of Common Plan personnel.

Since 1994, the council has encouraged defining locality pay out places employing the Office environment of Management and Budget’s (OMB) statistical region definitions, which give nationally regular delineations for a established of geographic places. Centered on the recommendations of the council, the Pay back Agent has up to date the locality areas, as needed, when OMB updates its statistical space definitions. At this time, the council utilizes definitions from OMB’s April 2018 update. OMB issued an update in March 2020. Some of the council members informed GAO that the council programs to go over these updates at the time the administration appoints new council associates. Utilizing the 2020 definitions could influence GS employees’ pay if destinations within existing locality fork out areas have been moved to separate locality shell out parts (better or reduced paying out).

In its 2019 memorandum, the council recognized 5 choices to the study methodology for environment locality pay out, together with verifying Bureau of Labor Data (BLS) study info with other human capital data—such as attrition data—and establishing a fee to periodically assessment federal civilian compensation. In accordance to council users, these options stand for the most the latest dialogue by the council of different methodologies. This is also steady with the final results of GAO’s literature search.

Why GAO Did This Review

FEPCA approved once-a-year locality-centered spend changes for GS employees. The act’s goal was to minimize documented fork out gaps between federal and nonfederal employees in precise regions of the U.S. to no more than 5 percent. Even though this objective has not been satisfied since its authorization in 1994, some amount of locality pay out will increase has been provided for 22 of the 28 a long time due to the fact FEPCA took outcome.

Residence Report 116-442 accompanying the monthly bill that would develop into the William M. (Mac) Thornberry National Defense Authorization Act for Fiscal Yr 2021 included a provision for GAO to critique the administration of the locality spend program.

This report describes (1) the system for administering the GS locality pay program, such as developing or modifying present geographical boundaries for locality spend areas and the amount of money of time required for these modifications (2) the status of incorporating OMB’s statistical spot definitions to determine the boundaries for locality spend locations and (3) the council’s possible choices for administering and utilizing the locality spend system.

GAO reviewed laws, Business of Staff Management (OPM) restrictions, council memorandums and Pay out Agent experiences, and BLS, OMB, and OPM files. GAO also interviewed OPM and BLS officials, OMB staff, and council associates and carried out a literature search.

The Division of Labor and OPM furnished technical responses on a draft of this report, which GAO integrated as correct. OMB had no responses.

For a lot more information and facts, contact Jeff Arkin at (202) 512-6806 or [email protected]

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