Newhouse Introduces Bill To Reform Telework Locality Pay for Federal Employees

This week, Rep. Dan Newhouse (WA-04) introduced The Federal Employee Return to Work Act to crack down on wasteful government spending and incentivize federal employees to return to in-person work. Federal employees who telework from home currently receive annual locality bonuses despite not being required to physically attend their offices located in a high-cost-of-living area. This bill is the House companion to U.S. Senator Bill Cassidy of Louisiana's bill.

"The federal government pays for massive offices for agency employees in Washington, D.C. and we now know that 17 of the 24 federal agencies are using less than a quarter of their space because of work from home employees,"said Rep. Newhouse.

Newhouse continued,"If agencies wish to allow their employees to work from home, that is within their right to do so. But if they do, then the government should not be paying locality bonuses to those employees and they should be treated like any other work from home federal employee that doesn't receive such a bonus. Taxpayers pay for federal buildings and salaries; it is time to stop wasting their money on empty buildings and unneeded work from home bonuses."

U.S. Senator Bill Cassidy (R-LA) said, "Federal employees get paid extra to work in higher-cost cities. But what if they don't show up to work? Why should they get paid?" said Dr. Cassidy. "If you don't show up for work, you don't get paid at the same rate just for teleworking."

The U.S. Government Accountability Office (GAO) found(link is external) that 17 of the 24 federal agencies were using 25% or less of their headquarters building's capacity at the beginning of 2023.

GAO identified six agencies that were on average 91% vacant while their employees still received a 16.44% locality bonus compared to the rest of the country, regardless of their in-office attendance. These agencies included the Social Security Administration, the Small Business Administration, and the Department of Housing and Urban Development.

The bill excludes certain federal employees who telework at least one day a week from receiving raises and special locality bonuses for their office location being in a high-cost-of-living area despite working from home.

In the bill, the term "covered employee" means "an employee who teleworks not fewer than 1 day, or in the case of an alternative work schedule, not less than 20 percent a week." The term does not include an employee who teleworks not fewer than 1 day a week; is disabled and receives reasonable accommodations; is a member of the Foreign Service; Federal law enforcement; Armed Services; or any other employee, the official worksite of whom is not described in section 531.605(a)(1) of title 5.(link is external)

If the employee meets the definition of "covered employee," then they may not receive an annual adjustment under section 5303 of title 5.(link is external) They shall be paid at the rate of basic pay under the applicable grade under the locality pay area designated as "Rest of U.S."

Full bill text can be found here.

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