Trump proposes pay freeze and retirement cuts for federal workforce

By on 18/03/2019 | Updated on 24/09/2020
No civil service pay rise next year according to documents (Image courtesy: Gage Skidmore/Flickr).

President Trump has renewed his attempt to impose a pay freeze for US civil servants in his 2020 budget proposals, and added new proposals to cut retirement benefits and reduce leave.

According to Government Executive, detailed documents released today show employee leave entitlement is also under attack by the president.

The documents reveal a plan for annual and sick leave to be pooled reducing the total number of days workers could take off during the year.

His plans for the 2020 budget, unveiled last Monday, made no mention of a civil service pay rise next year, with the president instead reiterating his intention to roll out performance related pay.

“The administration is exploring broad alternatives that better target pay increases and incentives toward recruitment and retention of top performing employees that have critical skill sets,” a senior administration official told Government Executive.

Renewed assault

Trump’s plans for a pay freeze in the 2019 budget eventually fell after Republican and Democrat legislators found common ground on the topic. Federal employees were awarded a 1.9% pay rise in the deal brokered to end the longest ever partial government shutdown.

But the White House has returned to the fray, adding a raft of changes to federal workers’ non-salary benefits. Employees would be required to pay more towards their pensions, and in future those who retired from work early would lose some retirement benefits. Government Executive has noted that under the new plans, workers hired on temporary contracts would no longer be eligible for a federal pension at all.

A range of further cost-cutting measures to existing pension plans were also put forward, such as cancelling cost-of-living increases in one scheme and reducing the annual cost-of-living adjustments in another. Many would see a reduction to their pension pots under plans to base annuity calculations on the average of their highest five years of salary, rather than the highest three years.

Hostile reaction

If all the changes were to go through, the government would save $102.5bn over the next decade. However, with the House now under Democrat control, Trump will face stiff opposition; and federal worker’s unions have been lining up to condemn the plans. 

“For anyone still looking for proof that this administration is hostile to its frontline federal workforce, look no further than the FY 2020 budget proposal,” said the National Treasury Employees’ Union (NTEU) President, Tony Reardon. 

“It would deprive federal employees of the resources they need to do their jobs, slash their retirement benefits, reduce their take-home pay and generally make 

their lives – and the lives of the taxpayers they serve – more difficult,” he added.

The American Federation of Government Employees (AFGE) called the proposed budget “a kick in the teeth” to workers.

About Natalie Leal

Natalie is a freelance journalist whose work has been published by The Sun Online, The Guardian, Novara Media, Positive News, and Welfare Weekly, among others. She also writes reports and case studies on global business trends for behavioural insights agency, Canvas8. Prior to working as a journalist Natalie worked for the public sector in social services for several years. She switched careers in 2013 after winning a fully funded NCTJ in a national writing competition. She holds a Masters degree in social anthropology from Sussex University where she specialised in processes of social change and international conflict and reconciliation processes.


  1. Independent_forever says:

    well, I guess the question is does anyone TRULY want to deal with the debt or not? The bottom line is federal workers are paid very well and have guaranteed jobs for life (itself a huge value) unlike their counterparts in the private sector. While private sector might pay more in certain jobs, there is NO JOB GUARANTEE as there seems to be in government positions. No one can be easily terminated without practically a Congressional hearing on the matter…almost ridiculous. While I would be directly impacted myself I have no problem cutting pay, cutting workers and streamlining the federal govt to only provide needed services and dump the rest of the wasteful spending of which there are billions and billions…

    • phil says:

      Ah yes…the debt argument. Say it with me — TAX BREAKS FOR THE WEALTHY ARE THE CULPRIT! Federal employees shouldn’t be targeted because of the irresponsible policy caused by this president and the complicit GOP.

    • lm says:

      Funny how republicans don’t talk about the deficit anymore. Those tax cuts have blown a hole in the deficit

    • R. Takewahpoor says:

      Not all Gov’t workers are guaranteed job security or are in high paying jobs guaranteed for life, we can be terminated just like any one else and they don’t need congressional hearings to do it. Civil service workers in gov’t hospitals work for their pay to support their families just as private sector employees do. You should find out more about government workers before you make unsubstantiated claims. Not all government workers work in Washington D.C.

  2. Out Raged says:

    You are an idiot and have no idea of the value federal employees give to the nation.
    In addition you forget that federal workers or taxpayers.
    This means that they too should have a voice.
    I worked for over 30 years in private industry and can tell you that I work far harder as a federal employee with less perks.
    It never ceases to amaze me that people like you take up the president’s charge until personally affected.
    Total bull crappy on you wanting less in pay or benefits..etc. The day they give you a pink slip, or tell you to pay more in insurance, or God forbid you live longer and find yourself totally on a fixed income with no cost of living adjustments.
    Trump and those like him will still have their millions and no compassion.
    It will then be too late and meaningless for me to tell you I told you so.

  3. Jaroslaw99 says:

    I have similar thoughts to the posters opposing the President’s plans, but I will word them another way. One constantly hears the drumbeat that Federal or State employees get more than private workers. Yes, we do (or did) because private employers are giving less and less. And that is exactly what we hear at contract time too. State government needs to be in line with what private employers are paying. Maybe the bosses should consider what the CEO’s are getting! Billions. Lets not forget, too, that the working class spends their paycheck, locally. Billionaires pay far less taxes as a percentage of income and they hide it overseas. I will reiterate OutRaged’s excellent point, Government employees are citizens and voters and should have a say too.

  4. In Disagreement says:

    I can’t believe anyone would think Federal employees do not work hard. We have limited resources, with stipulations on how those resources are spent, to provide service and support to the public. In no way does a Federal Employee make more money than a private sector individual. I was just having this discussion with a co-worker. Do you realize that someone who has no experience working in the gov’t would have to have a PHD to qualify for a GS 11 position? Why would anyone with a PHD apply for a job that pays $65K per year? No our pay is not comparable to the private sector, nor is it equivalent to the uniformed services. We have people who do the same jobs but some are civilians and some are uniformed officers, yet the officers pay is MUCH higher and they don’t have tax withholdings, plus a variety of other benefits.
    When you compare the benefits of the gov’t versus private sector, sure the gov’t seems better. in the private sector the employee does contribute more to their retirement and other benefits, but again, they have much higher pay for similar positions in the gov’t. If Trump gets his way, then federal workers will have to contribute more towards benefits and retirement while making less than someone in the private sector. There will be a mass influx of people leaving the gov’t for better paying jobs in the private sector.

  5. Conman says:

    Oh really? Pay freeze, hack retirement benefits, and reduce federal workers take-home pay when the US economy is the “strongest ever”? And please do not mention the deficit, which GOP used relentlessly as an argument to block many initiatives in prior administrations, yet it did not hesitate a bit to make it much worse for the benefit of the wealthy – hypocrisy and corruption at its finest!!! Wasn’t the now more than 40% increase in the deficit created by the tax cut supposed to be evened out by increased job generation? And what about cutting this administration’s lavish lifestyle, which is a drain on taxpayers indeed, and reconsidering the irresponsible tax cut granted to benefit the wealthy few?!.

  6. William Connors says:

    There is absolutely NO reason a federal or a state employee should ever be given defined benefits for the rest of their lives unless they fully fund it like employees in the private sector have to do…. Also social security recipient’s do NOT receive a cost of living raise yearly and when we do it is NOT close to 3 percent federal and state employees do receive. Pensions are out of hand and need to be reigned in. I will NOT finance a bailout or receive less services when this scheme fails period…

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