The FED Weekly

Lawrence: Welcome to the Federal Workforce
Roundup for 15-21 June 2025, your

essential weekly briefing on the policies
and proposals shaping your career,

your benefits, and your retirement.

Whether you’re a current federal employee
navigating changes in the civil service,

or a retiree keeping a close watch on your
hard-earned pension and healthcare, this

is your source for the latest news from
Capitol Hill and the executive branch.

Each week, we cut through the noise to
bring you the critical updates on budget

negotiations, pay raises, workforce
policies, and the legislative battles that

directly impact the federal community.

Let's get you up to speed on
what happened this past week.

Issues That Affect Current
and Retired Federal Workers

Budget Reconciliation Targets
Federal Employees: Congressional

Republicans advanced a sweeping budget
reconciliation package (nicknamed the

“One Big Beautiful Bill”) with major
implications for the civil service

The Senate’s draft version, released
on June 13, preserves controversial

provisions forcing new federal
hires to choose between giving up

merit-based civil service protections
or paying substantially higher

FERS retirement contributions

Under this plan, future employees who
wish to keep their appeal rights and

job protections would contribute 14.4%

of salary toward their
pension (versus 9.4%

if they forfeit those rights),
dramatically increasing their

cost for retirement benefits

The bill also mandates a $350 fee for
Merit Systems Protection Board appeals

(refunded if the employee prevails)
and orders audits of Federal Employees

Health Benefits (FEHB) family enrollments
to remove ineligible participants

Notably, the Senate draft removed
several House-passed retirement cuts:

it dropped provisions to calculate
pensions on a “high-5” salary average

instead of high-3, to hike FERS
contributions for current employees, and

to eliminate the FERS annuity supplement
for early retirees, thereby sparing

earned benefits that had been at risk

. The Senate text still includes a
far-reaching section granting the

President broad authority to reorganize
or shutter federal agencies with

minimal oversight – a move NARFE warned
could let the executive “dismantle…

the entire federal government”
with limited congressional input

. Federal employee advocates are sounding
alarms: NARFE President William

Shackelford criticized the new hire
provisions as “converting the civil

service into a haven for political
cronies,” undermining merit-based hiring

. AFGE National President Everett
Kelley likewise blasted the package

as a “big retaliation bill” aimed
at civil servants and their unions

. While pleased that the Senate rejected
cuts to vested retirement benefits,

employee groups are urging the Senate to
strip out the remaining anti-civil service

measures before any final bill is enacted

. Legal Block on Data Sharing (Privacy
Victory): In a win for federal

employees’ privacy, a federal court
intervened to limit the new Department

of Government Efficiency (DOGE).

On June 9, a U.S.

district judge granted a preliminary
injunction blocking OPM from sharing

federal personnel data with DOGE agents

. The judge found potential privacy and
cybersecurity violations in how DOGE was

accessing sensitive employee information

. This order temporarily halts
DOGE’s data mining of federal HR

systems pending further review.

The DOGE, a White House-created office
tasked with cutting government costs,

had been aggregating federal employee
data to identify “inefficiencies.”

Now, thanks to the court’s ruling,
personal data of federal workers and

retirees held by OPM is off-limits to DOGE
unless stronger safeguards are in place.

Employee advocates, including
NARFE, welcomed the injunction

as protecting civil servants
from unwarranted intrusions.

The case underscores the ongoing
tension between aggressive cost-cutting

initiatives and the rights of
federal personnel – with courts

signaling that accountability and
privacy cannot be ignored even amid

government reorganization efforts

. Issues That Affect Current Federal Workers

A sign marks the headquarters
of the Department of Veterans

Affairs in Washington, D.C.

(February 20, 2025)

. VA and DoD Workforce Reduction Plans:
Federal agencies are grappling with

steep staffing cuts under administration
and congressional directives.

At the Department of Veterans Affairs
(VA), leadership is moving forward

with a plan to reduce its workforce
by 15% (approximately 80,000 jobs)

to return to 2019 staffing levels

. VA Secretary Doug Collins held a June 20
town hall acknowledging that “change is

always uncomfortable” and bluntly urged
unmotivated employees to consider leaving

. Collins emphasized that front-line
health care workers and benefits staff

are largely exempt from the cuts, which
will instead focus on administrative

overhead and vacant positions.

The VA has already implemented
an in-person work mandate (ending

pandemic-era telework) and is
hiring for critical roles even

as it plans for reductions

. Unions warn, however, that slashing
tens of thousands of VA jobs will

harm veterans’ services – AFGE’s
Everett Kelley condemned the cuts

as a “no-holds-barred assault on
veterans” that will make veterans and

their families “suffer unnecessarily”

. Meanwhile, the Pentagon is facing its own
downsizing: the Department of Defense aims

to cut about 5–8% of civilian positions
(~50,000 jobs) as part of a “Workforce

Acceleration” cost-saving initiative

. A House appropriations bill for
FY 2026 not only funds a 3.8%

pay raise for military personnel,
but also endorses these

civilian cuts – trimming $3.6

billion and ~45,000 DoD civilian FTEs
in line with DOGE’s recommendations.

To avoid disruptive layoffs, DoD has
leaned on a “deferred resignation”

buyout program that incentivized 22,000
employees to voluntarily leave in exchange

for continued pay through October.

However, House Democrats raised concerns
about morale and readiness, unsuccessfully

proposing an amendment on June 10
to pause the VA’s mass firing plan.

With Congress signaling support, both
VA and DoD are pressing ahead – making

it clear that many federal workers
face uncertain job security as agencies

“right-size” their payrolls in 2025.

OPM Orders Accountability and Ends
Telework Flexibilities: The Office of

Personnel Management is implementing
sweeping workforce policy changes

to create a “high-performance”
culture across the government.

In a June 17 directive, Acting OPM
Director Chuck Ezell announced new

performance management standards
that apply to all non-SES employees.

Agencies must align performance ratings
with measurable results and swiftly

address poor performers – including via
reassignment or removal – rather than

tolerate “failing up” in the system.

Supervisors will receive enhanced
training, and by FY 2027 all agencies

will use a unified performance
appraisal timeline to ensure consistency

“Federal employees should be held to
the highest standards of performance

and accountability,” Ezell stated,
underscoring that the administration

seeks to reward excellence
while rooting out inefficiency.

Alongside this push for
accountability, OPM has reversed

many pandemic-era telework policies.

An Inspector General report
released June 20 revealed “rampant”

telework abuse under the previous
administration’s lax policies at OPM.

The IG found that over half of sampled OPM
staff failed to meet in-office attendance

requirements, and many had missing or
expired telework agreements on file

. In response, OPM’s leadership
– acting on President Trump’s

direction – has reinstituted
strict in-office requirements.

As of March 3, all OPM employees are
required to report to their official

work site full-time, effectively ending
expanded telework and remote arrangements.

“That era of telework abuse is over,” said
Ezell, noting that in-person operations

have been restored “to ensure federal
employees are working for the taxpayers”.

OPM has also tightened internal
controls to monitor compliance.

These moves at OPM signal a broader
government-wide shift back to traditional

in-office work norms and a tougher
stance on performance—changes that

current federal workers nationwide are
now experiencing as agency policies

quickly come into line with the
new administration’s expectations.

Supreme Court Expands Pay Rights
for Reservist Employees: A recent

Supreme Court ruling is poised to
benefit federal employees who serve

in the Reserve or National Guard.

In Feliciano v.

Department of Transportation (decided
April 30, 2025), the Court held 5–4

that federal reservists called to active
duty during a national emergency are

entitled to “differential pay” – i.e.

the government must make up any shortfall
between their federal civilian salary

and their military pay – regardless
of whether their military service was

directly related to the emergency.

This clarified that reservists need
not prove a “substantial connection”

between their service and the national
emergency, overturning a previous

Federal Circuit interpretation.

The case was brought by Nick Feliciano,
a Coast Guard reservist and FAA air

traffic controller, who had been
denied such pay for long-term active

duty he performed (unrelated to
the 9/11 and Iraq War emergencies).

Thanks to the Supreme Court’s decision,
many federal employees who served on

active duty orders since 2001 may now
file claims to receive back pay for

salary differences during their service.

Law firms report a surge of inquiries
from reservist federal workers who

were previously unaware they could
be eligible for these payments.

The Merit Systems Protection Board,
which handles federal pay claims, could

see a wave of new cases as a result.

While MSPB lacks a quorum at
the moment, its regional offices

continue to process initial claims

. Bottom line: the high court’s ruling
reaffirms that federal agencies must

fully support employees who perform
military duties, and affected feds

(past and present) should check
if they are owed compensation.

OPM and agency HR offices are
advising employees of their

rights in light of the decision.

Postal Service Labor Developments: In
postal workforce news, another major

union contract has been secured even
as leadership changes loom at USPS.

On June 17, the National Rural
Letter Carriers’ Association (NRLCA)

announced that its members ratified a
new three-year collective bargaining

agreement running through May 2027.

Two-thirds of rural carriers voted
in favor of the deal, which provides

annual wage increases, semiannual
COLAs, and measures to improve

retention of rural carrier associates.

“This agreement is economically
responsible, fair to our employees

and serves the best interest of our
customers,” said Acting Postmaster

General Doug Tulino, praising the
balance of rewarding workers while

upholding USPS’s service mission.

Meanwhile, the American Postal Workers
Union (APWU) – which represents clerks,

maintenance staff and others – has
a tentative contract on the table

and began mailing out ballots to
its 200,000+ members this week.

APWU President Mark Dimondstein urged a
yes vote, highlighting that the tentative

36-month agreement locks in yearly pay
raises, six COLA adjustments, no-layoff

protections for newer employees, limits
on outsourcing, and other gains – with

“no givebacks or concessions.”.

Voting will conclude by July 10.

(By contrast, the National Association
of Letter Carriers had rejected a

proposed contract earlier this year,
requiring arbitration to settle terms

including wage hikes and COLAs.).

In the midst of these negotiations,
the Postal Service is preparing

for a change at the top.

The USPS Board of Governors, with
President Trump’s backing, has

selected David Steiner – a former
Waste Management CEO and FedEx board

member – as the next Postmaster
General, succeeding Louis DeJoy.

Steiner is expected to take office in
July and has pledged to maintain USPS’s

public service mandate and independence.

Postal employees, both unionized and
management, will be watching closely as

the new PMG inherits the challenges of
improving delivery performance, managing

costs, and potentially fending off renewed
discussions of postal privatization.

Overall, this week’s postal news
brings reassurance of labor stability

(via new contracts covering hundreds
of thousands of workers) even as

the agency undergoes leadership
transition at the highest level.

Issues That Affect Retired Federal Workers

Retirement Benefits Protected from Cuts:
Federal retirees and employees nearing

retirement gained a measure of relief this
week as congressional efforts to curtail

certain earned benefits were put on hold.

As noted above, the Senate’s
reconciliation bill omitted several

provisions that would have eroded
federal retirement benefits for

current workers and future retirees.

Proposals passed by the House in May
– which sought to require all current

employees to pay higher contributions
toward their pensions, switch the pension

calculation from the highest-3 salary
years to highest-5 (reducing payouts),

and end the FERS annuity supplement for
those who retire before 62 – did not make

it into the Senate’s draft legislation.

The annual COLA for 2025 (paid
this past January) was 2.5%

for CSRS pensions and 2.0%

for FERSand early indicators suggest
a modest COLA in 2026 if inflation

remains under control (year-to-date
CPI-W figures are up about 1.9%

through May).

Retiree advocacy groups
remain vigilant, however.

They note that the budget resolution
Congress adopted earlier this year still

assumes significant long-term savings from
federal retirement programs, which means

ideas like raising the FERS contribution
rates or altering benefit formulas

could resurface in future negotiations.

For the week of June 15–21, retirees
can be encouraged that no new cuts have

advanced – in fact, due to advocacy
and Senate pushback, the most harmful

proposals were set aside, preserving
the stability of federal annuitants’

pensions and bridging supplements.

Retired federal employees – and those
close to retirement – will continue

to watch legislative developments
closely, but this week’s outcomes

suggest bipartisan resistance to
cutting earned retirement benefits.

And that’s a wrap on this week’s
Federal Workforce Roundup.

The landscape for federal employees
and retirees is constantly shifting,

with major decisions being made about
everything from pay and job security

to retirement benefits and the very
structure of the civil service.

Staying informed is your best tool.

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Thanks for tuning in.

We’ll be back next week to
track the latest developments

and what they mean for you.

Until then, stay engaged and be well.