Federal workers are reeling as the government remains shut weeks after lawmakers were unable to come to an agreement. Federal employees are understandably concerned about how this event impacts not just their pay but also benefits and retirement plans. The following will provide some information so you can feel more in control of the situation.
How does the shutdown impact my pay?
During a government shutdown, federal employees, whether on furlough or essential, will not receive their salaries. However, President Donald Trump enacted legislation that provides all federal employees receive back pay once they restore funding. This is meant to better ensure that employees will eventually receive compensation for the period they worked or were furloughed. Similarly, the government can still award performance bonuses, disbursing payment after the shutdown ends.
What about health care and employment benefits?
Federal employees should maintain their health care coverage under the Federal Employees Health Benefits Program during a shutdown. Premiums should accrue and the government will take payment from the first paycheck once funding resumes. Additionally, dental and vision coverage will continue without interruption, a change from previous shutdowns. Furloughed employees may file for unemployment benefits in some states, but typically must repay these benefits upon receiving back pay.
Another important change from previous shutdowns is the fact that federal human resources officials are now essential, so they can process changes in coverage due to life events during a shutdown.
Retirement benefits
Federal retirees will continue to receive their annuity payments during a shutdown. However, there is a pause for contributions to the Thrift Savings Plan until agencies reopen. The Federal Retirement Thrift Investment Board will continue to operate, because employee contributions provide funding.
A government shutdown can create significant uncertainty for federal employees, but understanding the legal framework surrounding pay, benefits, and retirement can help mitigate some of the stress. By knowing what to expect, federal workers can better prepare for the potential challenges posed by a lapse in appropriations.