What defense employees can expect if the government shuts down

by Braxton Taylor

As of Tuesday, lawmakers and the White House had just 11 days to reach an agreement and pass a short-term measure to fund the government and avert a shutdown beginning next weekend.

House Republicans’ latest plan—to pass a one-month continuing resolution that keeps the Defense and Veterans Affairs departments funded at fiscal 2022 levels and cuts all other discretionary spending by 8 percent—fell apart Tuesday afternoon as House Speaker Kevin McCarthy reportedly postponed a vote to begin consideration of the measure because it failed to mollify conservatives in his caucus. The measure was likely to be considered dead on arrival in the Senate, where lawmakers in both parties have advanced spending measures abiding by last spring’s debt ceiling deal on a bipartisan basis.

Here’s what federal employees can expect in terms of pay and benefits if the government shuts, based on guidance from the Office of Personnel Management, last updated in 2021 after a number of updates were signed into law following the 35-day partial government shutdown that began in late 2018.

Salaries: Furloughed federal workers and employees who have been deemed essential and forced to work during a lapse in appropriations will not be paid during a shutdown. However, thanks to a 2019 law signed as part of the measure to fund the government at the end of the 35-day shutdown, they all will automatically be granted back pay to cover the shutdown once funding is restored. In previous appropriations lapses, Congress had to approve back pay for furloughed federal workers following each shutdown, but that process has since been automated.

Similarly, employees who worked overtime during the shutdown will be granted premium pay, although not until after the government has reopened.

Bonuses: Agencies may award performance bonuses during a shutdown, but those awards won’t be paid until after funding is restored.

Unemployment: Federal employees who are furloughed are eligible for unemployment compensation in some states. But in many cases, they must return the money once they receive back pay.

Health care: Furloughed federal workers will maintain their coverage under the Federal Employees Health Benefits Program during a lapse in appropriations. Premiums accrue over the course of a shutdown, and then are taken out of employees’ first paycheck after the government reopens.

And employees enrolled int eh Federal Employees Dental and Vision Insurance Program will also maintain their coverage, with unpaid premiums being withheld from their first post-lapse paycheck. In previous shutdowns, if the lapse persisted for longer than two pay periods, insurance carriers could allow those employees’ policies to lapse.

Additionally, federal employees can now make changes to their insurance plans due to significant life events during a shutdown. OPM regulations issued in 2020 clarified that agency HR employees, previously furloughed during lapses in appropriations, are deemed essential for the purposes of handling FEHBP enrollments.

Retirement benefits: Federal retirees in the Civil Service Retirement System and Federal Employees Retirement System will still receive their scheduled annuity payments during a shutdown. Contributions to the Thrift Savings Plan will be paused until the government reopens, though the Federal Retirement Thrift Investment Board, which administers the TSP, will remain open since their budget comes from employee contributions, not congressional appropriations.

Leave: Federal workers cannot substitute paid leave for unpaid furloughs when the government is closed. Previously scheduled leave that occurs during a lapse in appropriations will be cancelled, although OPM has stressed that does not mean excepted employees cannot request time off during a lapse in appropriations.

Instead, agencies can excuse excepted employees from duty and place them in furlough status for the time they are out. And an excepted employee who had been scheduled to be on paid leave may be off duty for those periods.

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