H.R. 2346: Overseas Pay Gap: Gone, Gone, Gone …

Well, not forever gone yet. The President released a brief statement after signing H.R. 2346 in the Oval Office on June 24. 2009:

"I want to thank the Members of Congress who put politics aside and stood up to support a bill that will provide for the safety of our troops and the American people. This legislation will make available the funding necessary to bring the war in Iraq to a responsible end, defeat terrorist networks in Afghanistan, and further prepare our nation in the event of a continued outbreak of the H1N1 pandemic flu."

Now it’s done. This one.

Here is what AFSA said about the overseas comparability pay implementation earlier, which is part of H.R. 2346.

Today AFSA has more via AFSANet:

[…] We have succeeded in achieving the first phase of our members number-one objective of getting Congress and the Administration to correct the historical injustice of excluding Foreign Service members posted overseas from the locality pay that all other federal employees assigned domestically receive. The Department of State and other foreign affairs agencies should now move quickly to close the first roughly ONE-THIRD tranche of that 23.1 percent pay gap in the current fiscal year. This should translate into a base salary increase in the vicinity of 7.7 percent, by October 1, for all Foreign Service members FS-01 and below assigned overseas. Ideally, this adjustment will be followed by similar measures in FY2010 and FY2011 to address the second and third tranches of the pay disparity. AFSA will work hard to make sure that happens.

H.R. 2346: Overseas Comparability Pay, Almost Here

I was not paying much attention to this; the CRS summary from May 2009 did not even include the OCP adjustment in its text. But it looks like H.R. 2346: Supplemental Appropriations Act, 2009 “Making supplemental appropriations for the fiscal year ending September 30, 2009, and for other purposes” is going to be the vehicle that would finally close the overseas comparability gap in the Foreign Service.

H.R. 2346 passed the House on May 14, 2009 and passed the Senate on May 21, 2009. The differences were resolved on Jun 16, 2009 and the bill was cleared for the WH on Jun 18, 2009. Having passed in identical form in both the House and Senate, this bill now awaits the signature of the President before becoming law.

See H.R. 2346 page in govtrack here. Click here for the final text of the enrolled bill (scroll down for Title XI).

Title XI: Department of State (relevant sections on OCP, reemployment of annuitants and incentives for critical posts reprinted in full below).

Overseas Comparability Pay Adjustment
Sec. 1113.
(a) Subject to such regulations prescribed by the Secretary of State, including with respect to phase-in schedule and treatment as basic pay, and notwithstanding any other provision of law, funds appropriated for this fiscal year in this or any other Act may be used to pay an eligible member of the Foreign Service as defined in subsection (b) of this section a locality-based comparability payment (stated as a percentage) up to the amount of the locality-based comparability payment (stated as a percentage) that would be payable to such member under section 5304 of title 5, United States Code if such member’s official duty station were in the District of Columbia.

(b) A member of the Service shall be eligible for a payment under this section only if the member is designated class 1 or below for purposes of section 403 of the Foreign Service Act of 1980 (22 U.S.C. 3963) and the member’s official duty station is not in the continental United States or in a non-foreign area, as defined in section 591.205 of title 5, Code of Federal Regulations.

(c) The amount of any locality-based comparability payment that is paid to a member of the Foreign Service under this section shall be subject to any limitations on pay applicable to locality-based comparability payments under section 5304 of title 5, United States Code.

Technical and Other Provisions
Sec. 1115.
(a) Modification- Title III of division H of Public Law 111-8 is amended under the heading ‘Economic Support Fund’ in the second proviso by striking ‘up to $20,000,000’ and inserting ‘not less than $20,000,000’.

(b) Notification Requirement- Funds appropriated by this Act that are transferred to the Department of State or the United States Agency for International Development from any other Federal department or agency shall be subject to the regular notification procedures of the Committees on Appropriations, notwithstanding any other provision of law.

(c) Reemployment of Annuitants-

(1) Section 824 of the Foreign Service Act of 1980 (22 U.S.C. 4064) is amended in subsection (g)(1) by inserting ‘, Pakistan,’ after ‘Iraq’ each place it appears; and, in subsection (g)(2) by striking ‘2009’ and inserting instead ‘2010’.

(2) Section 61 of the State Department Basic Authorities Act of 1956 (22 U.S.C. 2733) is amended in subsection (a)(1) by adding ‘, Pakistan,’ after ‘Iraq’ each place it appears; and, in subsection (a)(2) by striking ‘2008’ and inserting instead ‘2010’.

(3) Section 625 of the Foreign Assistance Act of 1961 (22 U.S.C. 2385) is amended in subsection (j)(1)(A) by adding ‘, Pakistan,’ after ‘Iraq’ each place it appears; and, in subsection (j)(1)(B) by striking ‘2008’ and inserting instead ‘2010’.

(d) Incentives for Critical Posts- Notwithstanding sections 5753(a)(2)(A) and 5754(a)(2)(A) of title 5, United States Code, appropriations made available by this or any other Act may be used to pay recruitment, relocation, and retention bonuses under chapter 57 of title 5, United States Code to members of the Foreign Service, other than chiefs of mission and ambassadors at large, who are on official duty in Iraq, Afghanistan, or Pakistan. This authority shall terminate on October 1, 2010.

(e) Of the funds appropriated under the heading ‘Foreign Military Financing Program’ in Public Law 110-161 that are available for assistance for Colombia, $500,000 may be transferred to, and merged with, funds appropriated under the heading ‘International Narcotics Control and Law Enforcement’ to provide medical and rehabilitation assistance for members of Colombian security forces who have suffered severe injuries.

There -- are you smiling yet? This is turning out to be a memorable June. If I don't catch the news when POTUS sign this into law, please zap me an email.

Related Item: (updated 6/22/09)
AFSANet on Closing the Overseas Pay Gap

Updated: 6/22/09 @10:29 pm:

Thomas indicates that H.R. 2346 was cleared for the White House on 6/18/2009 and presented to the President on 6/19/2009. The following describes the enactment into law following approval by both houses. Read the whole thing here.

Article I, Section 7, of the Constitution outlines the procedure for presidential judgment of legislation. The president has four options: sign the bill, which makes it law; VETO the bill and return it to Congress; refuse to take any action, in which case, after ten days, the bill becomes law without the president's signature; or, if less than ten days are left in the congressional term, "pocket veto" the bill by not signing it (because Congress has no time to take up the bill, the pocket veto kills the bill).

There should be a final word on this between now and July 3.

Foreign Service Overseas Pay Equity Act of 2009

On July 16, 2008, the AFSA-supported "Foreign Service Overseas Pay Equity Act of 2008" (H.R. 3202 which was originally offered by Rep. Christopher Smith [R-NJ]) was approved by the House Foreign Affairs Committee (HFAC) on a voice vote with bipartisan support and no opposition. Congressman Smith wrote a letter to his colleagues regarding this issue last year. On September 23, 2008, the Senate Foreign Relations Committee (SFRC) passed an almost identical version of the House bill (assigned Senate bill number S. 3426 when offered by Senator John Kerry (D-MA)) on a voice vote with bi-partisan support and no opposition.

Then Congress adjourned without moving the bill to final passage.

AFSA was nonetheless pleased that the bill went that far saying that these actions were “a result of expanding awareness on Capitol Hill that the large and growing cut in base pay imposed on the junior and mid-level Foreign Service is a serious disincentive to recruitment, retention, and overseas service.”

Thanks to Diplopundit reader, Stephanie for the tip on the whereabouts of this bill – it is still in Committee.

Rep. Christopher Smith [R-NJ] re-introduced the bill as H.R. 370: Foreign Service Overseas Pay Equity Act of 2009 in the 111^st Congress on January 9^th. It currently has one sponsor, Rep. Donald Payne [D-NJ] and has been referred to House Oversight and Government Reform and the Committee on Foreign Affairs. This bill is once more, in the first step in the legislative process. Introduced bills and resolutions first go to committees that deliberate, investigate, and revise them before they go to general debate.

Would this go further this congressional year? In this severe budget crunch? Don’t know -- it’s all guess work right now.

The Foreign Service Overseas Pay Equity Act of 2009, like its previous version seeks to amend the Foreign Service Act of 1980 to extend comparability pay adjustments to members of the Foreign Service assigned to posts abroad, and to amend the provision relating to the death gratuity payable to surviving dependents of Foreign Service employees who die as a result of injuries sustained in the performance of duty abroad. Read the whole text of the bill here.

A lot of talk on the pay gap already, so I'll look at Section 3 of this bill which reads: SEC. 3. DEATH GRATUITY.

The first sentence of section 413(a) of the Foreign Service Act of 1980 (22 U.S.C. 3973(a)) is amended by striking `at the time of death' and inserting `at level II of the Executive Schedule under section 5313 of title 5, United States Code, at the time of death, except that for employees compensated under local compensation plans established under section 408, the amount shall be equal to the greater of 1 year's salary at the time of death or 1 year's salary at the highest step of the highest grade on the local compensation plan from which the employee was being paid at the time of death'.

The CRS folks who did a report on this last year writes that the Foreign Service Act of 1980 currently authorizes the Secretary of State to provide, at the Secretary’s discretion, a death gratuity to the survivors of any Foreign Service employee who dies as a result of injuries sustained in the performance of the employee’s duty abroad. The amount of the death gratuity is equal to the employee’s annual salary at the time of death.

The death gratuity section amends the current death gratuity provision in two ways:

#1. The death gratuity is increased for Foreign Service employees who die as a result of injuries sustained in the performance of his/her duty from the equivalent of one year’s salary to the salary of a level II of the Executive Schedule (As of January 2009, Level II pay in the Executive Schedule is $177,000). If an entry level FSO is killed, his/her surviving dependents would get a death gratuity of $177,000 instead of his/her one year salary of approximately 38K in the 2009 pay schedule).

#2. A death gratuity is authorized for employees compensated under local compensation plans. The amount of the death gratuity for the individual is equal to the greater of one year’s salary at the time of death, or one year’s salary at the highest step of the highest grade on the local compensation plan that the employee was under at the time of death.

The local compensation plans vary from country to country based on prevailing rates, normally paid in local currency, unless the economy has been dolarized but -- my understanding on this is if an employee is an FSN 6/2, and he/she is killed his/her death gratuity would be the greater amount between his/her annual salary at the time of death or one year salary at the highest step of the highest grade in his/her local plan (FSN 12/step 12 is the highest grade and step, I think). In the US Embassy Nairobi bombing in 1998, 12 American USG employees and family members, and 32 Kenyan local employees of the U.S. government were killed. This type of provision would have authorized giving the survivors of the Kenyan local employees a death gratuity.

U.S. diplomat Howard Kavaler according to this report received $68,000 as death gratuity for his FSO wife’s horrific death in Nairobi. I have no idea how much the local employees’ survivors were compensated in that incident under the Secretary of State’s discretion.

The 2008 CRS report here interprets the second portion of this section as a reference to Civil Service employees detailed to an embassy. I thought -- what? It must have been 30 years ago when local employees at U.S. missions overseas were moved away from Civil Service, so the argument used in this report is not accurate, I think. Also, this bill uses the specific language of “employees compensated under local compensation plans;” I don’t think you would lump Civil Servants under any local plan.


I'm not a lawyer, so if you have a different reading of this bill, please feel free to comment below.

Then there's this piece on death and forgetfulness in the Foreign Service that is heartbreaking. You can help by contacting your senators and representative in the 111^th Congress here.

Related items:

• Must Read: Jeff Stein’s
  “State Department ‘Weenies’ Do Have a Point” (Nov 2007)
• 3 Foreign Affairs Manual 3650
  Death Benefits for Death in the Performance of Duty (pdf)
  
• Congressional Research Service
  Proposals for a New Foreign Service Compensation System in the 110th Congress
  September 12, 2008 (pdf)

Fair Pay Act of 2009 - About Time, Too!

President Obama signed the Lilly Ledbetter Fair Pay Act of 2009 into law today! Yay!

In my other life, I did work as a software analyst for a tech company. As I was considering whether to stay in the company or not, I learned that I was paid significantly less than my colleagues even as we were doing exactly the same work. At that time, I had yet to complete my graduate degree. My project manager told me, they were paid more because they had advanced degrees. I still remember feeling crappy about it but it also made my decision to leave easier. No, I did not take my employer to court; I went back to school to complete my degree.

The new law amends title VII of the Civil Rights Act of 1964 and the Age Discrimination in Employment Act of 1967, and modify the operation of the Americans with Disabilities Act of 1990 and the Rehabilitation Act of 1973, to clarify that a discriminatory compensation decision or other practice that is unlawful under such Acts occurs each time compensation is paid pursuant to the discriminatory compensation decision or other practice, and for other purposes.

So President Obama’s first piece of legislation signed into law has real meaning for me. I’ve been there, they’ve done that. The Court ruled that employees subject to pay discrimination like Lilly Ledbetter must file a claim within 180 days of the employer's original decision to pay them less. The new law means that complaints can now be filed 180 days after any discriminatory paycheck. I won’t recover anything from my former employer since gone bankrupt but this would make employers think twice before pulling these kind of tricks on others.

More info here and here. The blog post here also includes links to the SCOTUS’ majority and minority opinions.

Overseas Pay Gap: Illustrated

© Jupiter Images from clipart.com

John Doe, a Foreign Service officer, and Mary, his wife, a primary school teacher, are assigned to Washington, D.C. John was recently informed that he will be assigned to Libya as a diplomat. In D.C., John earns a base salary of $52,221 (FS-4 rank) and a 23.10-percent D.C. locality payment (worth $12,063) for a total of $64,284. Mary earns $48,000 as a teacher. Their total family income is $112,284.

When the Doe family arrives in Tripoli they will no longer receive locality pay ($12,063) but will receive a 20 percent hardship differential ($10,444). While John will take a small pay cut to serve overseas, Mary will most likely not be able to find employment in Libya so she will lose her entire salary ($48,000). Thus, despite John's hardship differential, the Doe family’s total income will drop from $112,284 to $62,665. That is a drop of $49,619 or nearly 45 percent from what they were earning in the Washington, D.C. area.

In addition, while in Libya, the Doe family will likely face significant out-of-pocket costs such as needing to fly back to the United States for a family member’s wedding, a sister’s life threatening illness, a beloved relative’s funeral, or for other important occasions not covered by government-funded emergency visitation travel.

Finally, in the event that John is killed in Tripoli, Mary would receive 23.10 percent less in death benefits than would the family of a TDY visitor from Washington. This is because Foreign Service death benefits are calculated on base pay, excluding allowances and differentials, and John’s salary is 23.10 percent less than it would be back in the States.

Read more here: http://www.afsa.org/congress/paygap09.pdf

The Overseas Pay Gap – Not Quite on Life-Support But …

Proponents of revisions in the Foreign Service compensation system point out that as increasing numbers of Foreign Service personnel are going to posts of increased hardship and danger, Foreign Service personnel serving abroad receive 20.89% less than their colleagues who are posted in Washington, D.C. due to the loss of locality pay when serving abroad. Both the 109th and 110th Congresses have considered proposals to eliminate this pay difference. The “Foreign Service Overseas Pay Equity Act of 2008,” H.R. 3202, as amended, would eliminate the pay differences over three years.

H.R.3202 - Foreign Service Overseas Pay Equity Act of 2008 was introduced to amend the Foreign Service Act of 1980 to extend comparability pay adjustments to members of the Foreign Service assigned to posts abroad, and to amend the provision relating to the death gratuity payable to surviving dependents of Foreign Service employees who die as a result of injuries sustained in the performance of duty abroad. You can read the full text of the bill here (PDF).

Status: Latest Major Action: Was placed on the Union Calendar, Calendar No. 571 on 9/24/2008. According to AFSA, the office of Senator Tom Coburn (R-OK) has also confirmed that he had placed a hold on H.R. 3202. AFSA’s John Naland has more on this here.

Cost Estimate: CBO estimates that implementing H.R. 3202 would cost $1.3 billion over the 2009-2013 period, assuming appropriation of the necessary amounts. That’s $5.00 per American over the 2009-2013 period as computed by govtrack.us. Full text of the cost estimate for the bill as ordered reported by the House Committee on Foreign Affairs on July 16, 2008 is available from the Congressional Budget Office here (PDF).

The Congressional Research Service (CRS) has also written a report on the “Proposals for a New Foreign Service Compensation System in the 110th Congress.” You can read the entire text here (PDF).

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