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Historic Pay Reform: Thousands of Federal Employees to See Wage Increases by 2025

Sandy Staggs

WASHINGTON, D.C. — After decades of inequity, federal workers across the United States are celebrating a groundbreaking achievement. U.S. Senator John Fetterman (D-PA) has successfully led the charge for a historic reform that will end nearly 30 years of pay disparity for hourly federal employees. Starting October 1, 2025, over 14,500 federal workers nationwide, including 2,100 in Pennsylvania, will benefit from a new rule finalized by the Office of Personnel Management (OPM). This change will inject $23.1 million into Pennsylvania workers’ pockets in the first year alone.

“For three decades, hourly federal workers across Pennsylvania have been shortchanged by a system that pays them differently than their salaried coworkers,” Senator Fetterman declared. “This is about treating workers with the dignity and respect they deserve. I made a commitment to stand with union members in this fight, and I’m proud that we finally got it done.”

A Persistent Fight for Wage Equity


The reform is the result of relentless advocacy from Senator Fetterman, unions, and labor rights groups. Federal hourly workers under the Federal Wage System (FWS) were paid less than their salaried General Schedule (GS) colleagues in the same regions due to outdated locality pay standards. This disparity led to significant wage gaps, making it harder to recruit and retain skilled workers.

The timeline of events leading to the reform highlights Senator Fetterman’s determination:

Washington State's ambitious $45 million Electric Vehicle (EV) Instant Rebate Program, aimed at making EVs more affordable and reducing carbon emissions, has been criticized for not meeting expectations. A recent policy brief by the Washington Policy Center (WPC) revealed that the program did not deliver the promised environmental benefits or provide much assistance to middle-income earners. The program, which was launched by the Washington State Department of Commerce, promised up to $9,000 off the lease of a new EV for low-income drivers. The state claimed that this rebate would make EV leases affordable, potentially bringing payments down to under $200 per month – far below the average $700 monthly payment for a gas-powered vehicle. However, after analyzing vehicle registration data for the two-and-a-half months the program was active, experts concluded that the program fell short of its goals. Failure to Meet Expectations Todd Myers, Vice President for Research at WPC, expressed disappointment with the outcome during an interview with The Center Square. He explained that the program was expected to increase sales of EVs and plug-in hybrid vehicles by about 8,700 units. In reality, it achieved only half of that target, with only around 4,800 vehicles sold through the rebate program. Myers pointed out that the environmental impact was minimal, saying, “For $45 million, we reduced emissions by just 0.03%. That’s virtually nothing for taxpayer money.” Despite the high cost of the program, the actual CO2 emissions reduction was almost negligible. Program Favors Higher-Income Earners One of the program's main goals was to provide assistance to low- and middle-income residents, making EVs accessible to those who traditionally struggle to afford them. However, data revealed that this was not the case. Before the rebates were introduced in August, the average income of individuals buying cars in the participating ZIP codes was around $122,000. After the program started, this dropped slightly to $118,000, indicating that the rebates were largely claimed by individuals with relatively high incomes. “The same people who were buying electric vehicles before the subsidies were still the ones purchasing them during the rebate period,” Myers said. “They’re certainly not poor.” Unintended Beneficiaries: Wealthy Buyers The WPC report highlighted that the rebate program disproportionately benefited wealthier buyers, particularly those purchasing popular models like the Tesla Model 3. Tesla sales more than doubled during the subsidy period compared to 2024 sales before the rebates. For example, buyers could receive $9,000 from Washington State, and an additional $7,500 from the federal government, totaling $16,500 in taxpayer-funded subsidies. While these subsidies may have made EVs more affordable for some buyers, they did not help to significantly shift the market toward low-income individuals. Myers called this outcome a waste of taxpayer money, especially considering that the program fell far short of its environmental goals. A Step Backward for Environmental Goals? The WPC’s analysis also pointed out that while the EV market in Washington State did see growth, it wasn't as significant as hoped. By October, EVs and plug-in hybrids accounted for just 21.8% of new vehicle sales in Washington, a slight increase over the 2023 level of 20.5%. This falls well short of the 35% target for 2026. Andrew Wineke, Deputy Communications Director for the Washington Department of Ecology, defended the program, pointing out that Washington is a national leader in the transition to clean vehicles. He noted that more than 200,000 zero-emission vehicles are now on the road in the state, with a 30% increase in sales over the past year. Wineke further stated that the rebates are just one tool in a larger strategy to accelerate the adoption of clean vehicles. The state's zero-emission vehicle regulations are expected to continue driving progress toward their long-term targets. What’s Next for EV Programs in Washington? Despite the program's shortcomings, Governor Jay Inslee's outgoing budget proposal included a request for an additional $82 million to extend and expand the EV rebate program for the current biennium. The question remains whether the new administration, under Gov. Bob Ferguson, will continue this initiative. The Center Square reached out to Gov. Ferguson's office for comment, but no response was received at the time of publication. As the debate continues, it remains to be seen how Washington will adjust its strategy to meet the state’s environmental and economic goals.
Washington State’s ambitious $45 million Electric Vehicle (EV) Instant Rebate Program, aimed at making EVs more affordable and reducing carbon emissions, has been criticized for not meeting expectations. A recent policy brief by the Washington Policy Center (WPC) revealed that the program did not deliver the promised environmental benefits or provide much assistance to middle-income earners.
  • September 18, 2023: Fetterman urged the Federal Prevailing Rate Advisory Committee (FPRAC) to address wage disparities.
  • December 21, 2023: FPRAC recommended aligning wage standards for FWS and GS employees.
  • February 29, 2024: Fetterman pressed OPM for immediate action.
  • October 11, 2024: The Biden-Harris Administration proposed the reform.
  • January 21, 2025: OPM finalized the rule for implementation by October 1, 2025.

This reform directly benefits key facilities like Tobyhanna Army Depot, Letterkenny Army Depot, and the United States Penitentiary (USP) Canaan, where unfair pay structures have created high turnover rates and recruitment challenges.

Impacts of the New Rule

Federal workers and union leaders are applauding the reform as a long-overdue correction to systemic wage inequities.

“By refining the criteria, this policy will better reflect regional economic conditions, align wages with local labor markets, and address disparities that have persisted for decades,” said Ned George, President of AFGE Local 1647 at Tobyhanna Army Depot.

David J. Demas, President of AFGE CPL-33 Local 3003 at USP Canaan, emphasized the importance of equal pay. “Our workers deserve wages that reflect the risks they take and the expertise they bring to their roles. This reform is a crucial step in ensuring their dedication is properly valued.”

The updated system will not only improve morale but also strengthen the federal government’s ability to retain skilled workers.

Washington State's ambitious $45 million Electric Vehicle (EV) Instant Rebate Program, aimed at making EVs more affordable and reducing carbon emissions, has been criticized for not meeting expectations. A recent policy brief by the Washington Policy Center (WPC) revealed that the program did not deliver the promised environmental benefits or provide much assistance to middle-income earners. The program, which was launched by the Washington State Department of Commerce, promised up to $9,000 off the lease of a new EV for low-income drivers. The state claimed that this rebate would make EV leases affordable, potentially bringing payments down to under $200 per month – far below the average $700 monthly payment for a gas-powered vehicle. However, after analyzing vehicle registration data for the two-and-a-half months the program was active, experts concluded that the program fell short of its goals. Failure to Meet Expectations Todd Myers, Vice President for Research at WPC, expressed disappointment with the outcome during an interview with The Center Square. He explained that the program was expected to increase sales of EVs and plug-in hybrid vehicles by about 8,700 units. In reality, it achieved only half of that target, with only around 4,800 vehicles sold through the rebate program. Myers pointed out that the environmental impact was minimal, saying, “For $45 million, we reduced emissions by just 0.03%. That’s virtually nothing for taxpayer money.” Despite the high cost of the program, the actual CO2 emissions reduction was almost negligible. Program Favors Higher-Income Earners One of the program's main goals was to provide assistance to low- and middle-income residents, making EVs accessible to those who traditionally struggle to afford them. However, data revealed that this was not the case. Before the rebates were introduced in August, the average income of individuals buying cars in the participating ZIP codes was around $122,000. After the program started, this dropped slightly to $118,000, indicating that the rebates were largely claimed by individuals with relatively high incomes. “The same people who were buying electric vehicles before the subsidies were still the ones purchasing them during the rebate period,” Myers said. “They’re certainly not poor.” Unintended Beneficiaries: Wealthy Buyers The WPC report highlighted that the rebate program disproportionately benefited wealthier buyers, particularly those purchasing popular models like the Tesla Model 3. Tesla sales more than doubled during the subsidy period compared to 2024 sales before the rebates. For example, buyers could receive $9,000 from Washington State, and an additional $7,500 from the federal government, totaling $16,500 in taxpayer-funded subsidies. While these subsidies may have made EVs more affordable for some buyers, they did not help to significantly shift the market toward low-income individuals. Myers called this outcome a waste of taxpayer money, especially considering that the program fell far short of its environmental goals. A Step Backward for Environmental Goals? The WPC’s analysis also pointed out that while the EV market in Washington State did see growth, it wasn't as significant as hoped. By October, EVs and plug-in hybrids accounted for just 21.8% of new vehicle sales in Washington, a slight increase over the 2023 level of 20.5%. This falls well short of the 35% target for 2026. Andrew Wineke, Deputy Communications Director for the Washington Department of Ecology, defended the program, pointing out that Washington is a national leader in the transition to clean vehicles. He noted that more than 200,000 zero-emission vehicles are now on the road in the state, with a 30% increase in sales over the past year. Wineke further stated that the rebates are just one tool in a larger strategy to accelerate the adoption of clean vehicles. The state's zero-emission vehicle regulations are expected to continue driving progress toward their long-term targets. What’s Next for EV Programs in Washington? Despite the program's shortcomings, Governor Jay Inslee's outgoing budget proposal included a request for an additional $82 million to extend and expand the EV rebate program for the current biennium. The question remains whether the new administration, under Gov. Bob Ferguson, will continue this initiative. The Center Square reached out to Gov. Ferguson's office for comment, but no response was received at the time of publication. As the debate continues, it remains to be seen how Washington will adjust its strategy to meet the state’s environmental and economic goals.
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A Long Road Ahead

While the reform is a significant milestone, Senator Fetterman emphasized that the fight for fair treatment is far from over. As Ranking Member of the Homeland Security and Governmental Affairs Subcommittee on Border Management, Federal Workforce, and Regulatory Affairs, Fetterman will oversee the rule’s implementation and push for its expansion to include additional facilities, such as Gettysburg National Military Park and Defense Logistics Agency New Cumberland.

“This is just the beginning of a larger movement to guarantee fairness and respect for all federal workers,” Fetterman said.

Delivering Justice to Federal Workers

This reform is not just about wages; it is about recognizing the value of federal workers and restoring dignity to their roles. “This adjustment ensures greater equity and fairness in wage determinations for federal employees,” George added, echoing the sentiment of many advocates.

For thousands of Pennsylvania workers, October 1, 2025, will mark the start of a brighter and fairer future. Senator Fetterman’s efforts demonstrate the power of persistence and collaboration in achieving meaningful change. Federal workers, often overlooked, are finally receiving the respect and financial recognition they deserve.

This victory is a testament to the importance of advocacy and the impact of collective efforts to bring about systemic reform.

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