What Does the Latest Legislative Proposal Mean for Federal Employees? 

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What Does the Latest Legislative Proposal Mean for Federal Employees? 

The latest legislative proposals for fiscal year 2025 signal significant changes for federal employees, encompassing reductions in pay and benefits, diminished job protections, and organizational restructuring. These measures are part of broader efforts to reduce federal spending and reshape the civil service. FedSmith.com Government Executive+1National Treasury Employees Union – NTEU+1

Proposed Cuts to Pay and Benefits

  1. Increased Retirement Contributions and Reduced Pensions

The House Budget Committee has advanced a reconciliation bill that includes provisions to: Federal News Network+5Federal News Network+5United Benefits+5

These changes aim to cut federal spending by $50 billion. FedSmith.com+4National Treasury Employees Union – NTEU+4NARFE+4

 Shift to Voucher-Based Health Insurance

Proposals suggest replacing the current Federal Employees Health Benefits (FEHB) cost-sharing model with a voucher system. This would provide a fixed-dollar contribution toward health insurance premiums, potentially leading to higher out-of-pocket costs for employees as healthcare expenses rise. U.S. Office of Personnel Management+2FedImpact+2U.S. Office of Personnel Management+2

  1. Pay Freeze and Performance-Based Increases

Legislation such as the Federal Freeze Act proposes a one-year freeze on federal pay increases and workforce caps over a three-year period. Additionally, the Federal Employee Performance and Accountability Act of 2025 introduces a pilot program where pay increases for certain employees would be contingent on job performance. FedSmith.comCongress.gov

Erosion of Job Protections and Union Rights

  1. Reinstatement of “Schedule F”

The Social Security Administration is considering reclassifying certain positions under a proposed “Schedule F,” designating them as “policy-influencing” and thereby removing civil service protections. This change would make it easier to dismiss employees and is part of broader federal budget cuts. Business Insider  

  1. Restrictions on Collective Bargaining

An appeals court has allowed the implementation of an executive order that limits collective bargaining rights for federal workers. This order affects multiple agencies and is part of efforts to streamline the federal workforce. AP News

Organizational Restructuring and Oversight

  1. Reorganizing Government Act of 2025

This act extends presidential authority to propose executive branch reorganization plans, requiring Congress to vote on these plans within 90 days without the possibility of a filibuster. The aim is to streamline government operations. dailyfed.com

  1. Department of Government Efficiency (DOGE) Initiatives

The Department of Government Efficiency, led by Elon Musk, has implemented cost-cutting measures within the Social Security Administration, including staff reductions and technology overhauls. These actions have led to service disruptions and increased workloads for remaining employees. Business Insider+2The Washington Post+2FedSmith.com+2

Potential Positive Developments

  1. Expanded Eligibility for Dental and Vision Benefits

The Office of Personnel Management (OPM) proposes to expand the definition of a “member of family” under the Federal Employees Dental and Vision Insurance Program (FEDVIP) to include individuals up to 26 years of age. This aligns dental and vision coverage with medical benefits extended under the Affordable Care Act. U.S. Office of Personnel Management

  1. Enhanced Oversight of Human Resources

OPM seeks statutory authority over approximately 40,000 federal employees working in human resources positions government-wide. This would allow OPM to manage training and development across all agencies, aiming to improve HR practices and employee support. Federal News Network

These legislative proposals collectively represent a significant shift in federal employment policies, with potential implications for job security, compensation, and organizational structure. Federal employees and stakeholders are advised to stay informed and engaged as these developments unfold.

 

Moody’s Ratings Downgrades United States Ratings To Aa1 From Aaa; Changes Outlook to Stable

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Moody’s Ratings Downgrades United States Ratings To Aa1 From Aaa; Changes Outlook to Stable

On May 16, Moody’s Ratings downgraded the U.S. credit rating, citing an inability of the nation to address large and growing deficits. This downgrade means that for the first time ever, all three major credit ratings agencies have downgraded U.S. credit below their top rating. Moody’s warning comes as lawmakers are considering budget reconciliation legislation that would make America’s fiscal situation significantly worse.

The new report from Moody’s downgrades the U.S. credit rating from the top level of Aaa (negative) to Aa1 (stable). In its announcement, Moody’s stated the following primary reasons for doing so:

  • Growing debt caused by increased federal spending and reduced revenues from tax cuts. Moody’s includes the assumption that extension of the 2017 TCJA provisions will add $4 trillion to the debt over the next decade. 

Follow link to read more from The Peter G. Peterson Foundation. Moody’s Downgrades U.S. Credit Rating, Warns Recent Policy Decisions Will Worsen Fiscal Outlook

U.S. Office of Special Counsel (OSC)  Now Says Agencies Can Fire Probationary Feds For Almost Any Reason

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U.S. Office of Special Counsel (OSC)  Now Says Agencies Can Fire Probationary Feds For Almost Any Reason

In a significant policy shift, the U.S. Office of Special Counsel (OSC) has informed over 2,000 probationary federal employees that it will not pursue their wrongful termination complaints, stating it lacks the authority to challenge these firings. This decision marks a reversal from the previous stance under former OSC head Hampton Dellinger, who had argued that such dismissals might be illegal under federal reduction-in-force rules and had called for a pause in terminations .WSJ+3The Washington Post+3POLITICO+3

The controversy centers on the Trump administration’s efforts to downsize the federal workforce, particularly targeting probationary employees—those within their first year of service or in new positions requiring a trial period. In January and February 2025, the Office of Personnel Management (OPM) issued memos directing agencies to terminate probationary employees by specific dates. However, U.S. District Judge William Alsup ruled that OPM had overstepped its legal authority, stating that no statute grants OPM the power to direct terminations in other agencies. Consequently, OPM rescinded the memos and revised its guidance, emphasizing that probationary periods should assess whether an employee will be an asset to the government, aligning with the President’s directive to reduce the federal workforce .The Washington Post+2AP News+2The Guardian+2Federal News Network+7WSKG+7Business Insider+7Wyoming Public Media+7NPR+7opb+7

Despite these developments, the OSC’s recent decision not to investigate the mass firings has raised concerns among Democratic lawmakers and legal advocates about the politicization of the agency, which is meant to protect federal employees from discrimination and retaliation. Critics argue that the OSC is abdicating its duty to investigate potential unlawful practices, suggesting that the dismissals stem from the Trump administration’s broader strategy to downsize federal employment rather than individual performance issues .The Washington Post

The situation has left many federal workers in limbo, with some agencies, like the National Science Foundation, reinstating fired employees based on updated guidance from OPM and federal courts. However, the broader implications for civil service protections and the integrity of oversight institutions remain a topic of intense debate and legal scrutiny .Wyoming Public Media+7NPR+7opb+7The Washington Post

Key Steps for Federal Employees Preparing to Retire

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What Do Federal Employees Need to Know if They Are Ready to Retire?

If you’re a federal employee preparing for retirement, it’s essential to understand the steps involved and recent updates to the process. Here’s a comprehensive guide to help you navigate your retirement journey:

Key Steps for Federal Employees Preparing to Retire

 Verify Your Eligibility

  1. Review and Complete Necessary Forms

 Gather and Verify Documentation

  • Official Personnel Folder (OPF): Ensure it contains all records of your federal service.
  • Military Service Records: If applicable, confirm that your military service is documented and any required deposits are paid. U.S. Office of Personnel Management

 Understand Your Benefits

  • Thrift Savings Plan (TSP): Decide on withdrawal options and understand the tax implications.
  • Social Security: Determine the optimal time to begin receiving benefits.
  • FEHB and FEGLI: Review your eligibility to continue health and life insurance benefits into retirement. U.S. Office of Personnel Management

 Submit Your Application

  • Timing: Submit your retirement application approximately 60 days before your intended retirement date.
  • Submission: If you’re currently employed, submit your application through your agency’s HR office. If separated, send it directly to OPM. U.S. Office of Personnel Management

IMPORTANT – Transition to Digital Retirement Applications

Starting June 2, 2025, the Office of Personnel Management (OPM) will process all new retirement applications digitally through the Online Retirement Application (ORA) system. Paper applications will no longer be accepted after July 15, 2025. This shift aims to expedite processing times and improve accuracy. Business Insider

 

 

Is it Legal For President Trump to Accept a Luxury Boeing 747-8 Jet From Qatar?

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Is it Legal For President Trump to Accept a Luxury Boeing 747-8 Jet From Qatar?

The legality of former President Donald Trump accepting a luxury Boeing 747-8 jet from Qatar is under intense scrutiny, primarily due to the U.S. Constitution’s Foreign Emoluments Clause. The Daily Beast+10Business Insider+10Time+10

 What Is the Foreign Emoluments Clause?

Article I, Section 9, Clause 8 of the U.S. Constitution, known as the Foreign Emoluments Clause, prohibits federal officials from accepting gifts, payments, or titles from foreign governments without the consent of Congress. This provision aims to prevent undue foreign influence and conflicts of interest. Wikipedia

The Proposed Jet Transfer

Reports indicate that the Qatari royal family plans to gift a $400 million Boeing 747-8 jet to the U.S. Department of Defense for use as Air Force One during Trump’s presidency. Subsequently, the jet would be transferred to the Donald J. Trump Presidential Library Foundation after his term ends. The aircraft, previously used by Qatar’s royal family, is lavishly outfitted with lounges, bedrooms, and other luxury amenities .The Daily Beast+15MySA+15New York Post+15news+9Vanity Fair+9ABC News+9Wikipedia

Legal and Ethical Concerns

Ethics experts argue that this arrangement may violate the Emoluments Clause, as it involves a valuable gift from a foreign government that could benefit Trump personally. Even though the initial recipient is the Department of Defense, the eventual transfer to Trump’s presidential library raises questions about personal gain and potential conflicts of interest .WSJ+11Time+11news+11

The Department of Justice has reportedly stated that the gift does not constitute bribery, as it is not tied to any specific service or favor. However, critics contend that the appearance of impropriety and the potential for personal benefit to Trump remain problematic .Mediaite

Congressional Approval and Precedents

Historically, U.S. presidents have sought congressional approval before accepting gifts from foreign governments. Without such approval, accepting the jet could set a concerning precedent and potentially violate constitutional provisions. Some lawmakers have expressed the need for a thorough legal review and possible congressional action to address the situation .New York Post+3news+3Time+3New York Post

Conclusion

While the proposed gift is framed as a donation to the U.S. government, the eventual benefit to Trump’s presidential library and potential personal use raises significant legal and ethical questions. The situation underscores the importance of adhering to constitutional safeguards designed to prevent foreign influence and maintain the integrity of public office.