💼Changes to Federal Wage System Impacting Wage Areas Announced
Prevailing Rate Systems; Change in Criteria for Defining Appropriated Fund Federal Wage System Wage Areas
Summary
The Office of Personnel Management (OPM) is issuing a final rule to change the regulatory criteria used to define Federal Wage System (FWS) wage area boundaries and make changes in certain wage areas. The purpose of this change, which will affect around ten percent of the FWS workforce, is to make the FWS wage area criteria more similar to the General Schedule (GS) locality pay area criteria. This change is based on a December 2023 majority recommendation of the Federal Prevailing Rate Advisory Committee (FPRAC), the statutory national-level labor-management committee that advises OPM on the administration of the FWS.
Agencies
- Personnel Management Office
Business Impact
$$ - Med
The regulation modifies Federal Wage System wage area boundaries, impacting about 10% of FWS employees, which will affect payroll budgeting and personnel management for businesses that interact with federal employees. Local businesses may face challenges in hiring due to wage disparities, as discussed in the text.