FAIR Act

Bill Number: H.R. 7480
Origin Chamber: House
Congress: 119th Congress, Session 2
Policy Area: Government Operations and Politics
Status: Introduced
Latest Action: 2026-02-10: Referred to the House Committee on Oversight and Government Reform.
Last Updated: 2026-07-03T08:06:21Z

AI-Generated Summary

Purpose

The Federal Adjustment of Income Rates Act (FAIR Act), H.R. 7480, aims to provide a targeted pay increase for federal civilian employees by adjusting base pay rates and locality pay. It sets specific percentage increases for calendar year 2027 to ensure predictable compensation adjustments, totaling 4.1 percent overall.

Key Provisions

Short Title (Section 1): The bill is officially named the "Federal Adjustment of Income Rates Act" or "FAIR Act."
Base Pay Adjustments (Section 2):
For employees under statutory pay systems (e.g., General Schedule or GS pay scale, which covers most federal civilian workers), basic pay rates increase by 3.1 percent in calendar year 2027. This follows the annual adjustment formula in U.S. Code but specifies the exact percentage.
For prevailing rate employees (non-GS federal workers whose pay is based on local wage surveys, such as certain blue-collar or trade roles), basic pay rates increase by 3.1 percent in fiscal year 2027. This overrides the usual requirement for local wage surveys, applying the raise uniformly across wage areas.
Locality Pay Adjustment (Section 3): Locality pay (additional pay to account for higher living costs in specific geographic areas) increases by 1 percent in calendar year 2027, as specified under U.S. Code.

Significant Changes to Existing Law

The bill mandates fixed percentage increases (3.1 percent for base pay and 1 percent for locality pay) rather than relying solely on the standard annual formulas under Title 5 of the U.S. Code, which typically tie adjustments to the Employment Cost Index (a measure of private-sector wage growth) or other economic indicators.
For prevailing rate employees, it temporarily bypasses the requirement for conducting local wage surveys under section 5343(b) of Title 5, U.S. Code, allowing a direct percentage-based raise instead of area-specific calculations. This is a one-year deviation from the norm.

Potential Impacts

On Government Agencies: Federal agencies will face higher personnel costs, estimated to increase the federal budget for salaries. This could strain agency budgets unless offset by additional appropriations, potentially affecting hiring, retention, or operational funding.
On Citizens: As taxpayers fund federal salaries, the pay raise may indirectly raise government spending. It could improve service delivery by helping retain experienced federal workers, benefiting public access to government programs and services.
On International Relations: No direct impacts, as the bill focuses on domestic federal employee compensation without provisions affecting foreign policy, aid, or international agreements.

Main Stakeholders Affected

Federal Employees: Primary beneficiaries, including over 2 million civilian workers under the General Schedule and prevailing rate systems (e.g., administrative, professional, and skilled trade roles in agencies like the Department of Defense, Veterans Affairs, and others). The raise aims to address inflation and cost-of-living pressures.
Federal Agencies and Managers: Must implement the pay changes, which could influence workforce planning and morale.
Taxpayers and Congress: Bear the fiscal cost and oversee future budget implications through appropriations.

Notable Legal, Constitutional, or Political Implications

Legal: The bill amends pay adjustment processes under Title 5, U.S. Code, ensuring compliance with existing federal compensation laws while providing congressional override of administrative formulas. It does not alter collective bargaining rights for unionized employees.
Constitutional: Aligns with Congress's authority under Article I to control federal compensation and appropriations, avoiding any separation-of-powers issues.
Political: As a bipartisan-sponsored bill (introduced by a mix of Democrats and Republicans), it reflects ongoing debates on federal pay equity versus fiscal restraint. If enacted, it could set a precedent for future legislated pay caps or boosts, influencing elections and budget negotiations by addressing employee retention amid economic challenges like inflation.

This summary was generated by AI and may contain inaccuracies. Refer to the official source document for the authoritative text.

Sponsor

Rep. Walkinshaw, James R. [D-VA-11]

Cosponsors (30)

Rep. Chu, Judy [D-CA-28], Rep. Jayapal, Pramila [D-WA-7], Rep. Subramanyam, Suhas [D-VA-10], Del. Norton, Eleanor Holmes [D-DC-At Large], Rep. Lynch, Stephen F. [D-MA-8], Rep. Elfreth, Sarah [D-MD-3], Rep. Ivey, Glenn [D-MD-4], Rep. McClellan, Jennifer L. [D-VA-4], Rep. Titus, Dina [D-NV-1], Rep. DelBene, Suzan K. [D-WA-1], Rep. Budzinski, Nikki [D-IL-13], Rep. Beyer, Donald S. [D-VA-8], Rep. Cleaver, Emanuel [D-MO-5], Rep. Fitzpatrick, Brian K. [R-PA-1], Rep. Hoyer, Steny H. [D-MD-5], Rep. Omar, Ilhan [D-MN-5], Rep. Simon, Lateefah [D-CA-12], Rep. DeGette, Diana [D-CO-1], Rep. McGovern, James P. [D-MA-2], Rep. Scott, Robert C. "Bobby" [D-VA-3], Rep. Evans, Dwight [D-PA-3], Rep. Mfume, Kweisi [D-MD-7], Rep. Tokuda, Jill N. [D-HI-2], Rep. Scanlon, Mary Gay [D-PA-5], Rep. Pocan, Mark [D-WI-2], Rep. Ross, Deborah K. [D-NC-2], Rep. Barragán, Nanette Diaz [D-CA-44], Rep. Carson, André [D-IN-7], Rep. Friedman, Laura [D-CA-30], Rep. Tonko, Paul [D-NY-20]