Obama issues pay freeze order

President Barack Obama issued an executive order the evening of Dec. 22 to carry out the two-year federal employee pay freeze that was signed into law that day. The White House first proposed the halt to salary increases in November, and the freeze was included as part of a continuing resolution approved by Congress Dec. 21.

In a memorandum accompanying the executive order, the president reiterated his reason for recommending the freeze.

“Despite the sacrifices that I knew a pay freeze would entail for our dedicated civil servants, I concluded that a two-year freeze in the upward statutory adjustment of pay schedules is a necessary first step in our effort to address the challenge of our fiscal reality,” Obama wrote.

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Obama also said federal workers are “not just a line in a budget.”

Labor groups have said the freeze unfairly targets federal workers.

The continuing resolution (H.R. 3082) funds the government through March 2011 and freezes statutory pay adjustments for all executive branch pay schedules for two years. It also generally prohibits executive departments and agencies from providing base salary increases — including performance-based increases — to senior-level employees, according to the memo.

In the memo, Obama directs agency heads who have the authority to exercise administrative discretion when it comes to executive branch pay schedules not to use that discretion during the pay freeze.

General increases, such as locality pay, are also suspended.

The freeze will be effective Jan. 1, 2011, and last until Dec. 31, 2012.

The Office of Personnel Management is preparing to issue guidance on implementing the freeze.