How The Holman Rule Affects Federal Employees

Congressional representatives voted to reinstate the Holman Rule this week, which allows members to propose amendments that reduce the pay of specific federal employees. Members of Congress would be able to reduce pay to one dollar for specific federal workers. This has left many political and economic experts wondering what the Holman Rule is and why it came to be.  

Along with economists and government analysts, some employees are asking what the Holman Rule could mean for their future. What should they do if their agency is targeted? What is the likelihood that they will be targeted?

Here’s what you really need to know about this obscure rule and its likely impact on your salary and federal retirement plan.  

What Is the Holman Rule?

In 1876, Representative William S. Holman of Indiana proposed a rule meant to reduce government spending. It was stripped down by 1885, but recent Republican representatives worked to bring it back.

The Holman Rule was reinstated in 2017, when representatives brought it to the floor in reaction to President Trump’s plans to dramatically reduce government spending. During the first few months of the Trump presidency, hiring for federal positions was frozen along with employee raises. Many agencies either experienced a reduction in force (RIF) or saw significant limitations placed on their operations budgets.

Rep. H. Morgan Griffith (R-VA) was responsible for reviving the Holman Rule. He compares the rule to using a sniper rifle to eliminate wasteful spending.

Democrats and federal employee unions told the Washington Post they prefer to call this provision the Armageddon Rule, as it could be used to slash the incomes of federal employees in specific departments if they are viewed as partisan against the majority party’s beliefs. However, Republican leaders say that the Holman Rule is simply meant to reduce overspending without having to make dramatic changes to specific agencies or entire position levels.

The Holman Rule In Action

Despite claims that this provision is nonpartisan and purely focused on fiscal responsibility, there have already been instances where the law has been used to wield political influence.

An amendment failed last year targeting 89 employees at the Congressional Budget Office. The goal of the proposed amendment was to completely abolish the Budget Analysis Division of the CBO, which provides insight on the impact various bills will have on the economy and the general public.

Supporters said abolishing the division would save the government $15 million in salaries annually, but opponents said the move was purely political. Republican members of Congress sparred with the CBO last year in regard to the impacts of various healthcare bills and changes to federal retirement plans. Each time, the CBO reports that the bills will have devastating impacts on the American public and federal workers. Without this office and its oversight analysis, many of the proposed bills would have likely passed.

Congressional representatives voted to reinstate the Holman Rule, which allows members to propose amendments that reduce the pay of specific federal employees.Click To Tweet

Will the Holman Rule Affect Federal Employees?

The Holman Rule is simply a provision that members of Congress are able to bring amendments to the floor. Despite the sniper metaphor, it is not a silver bullet solution for lawmakers to change employee salaries on a whim. In order for the rule to go into effect, there would have to be majority votes in both the House and the Senate. This isn’t easy in any Congress, much less one where political partisanship dictates almost every vote.

However, the provision does mean that more Congressional leaders are likely to bring salary changes to the floor. Recently, certain nonpartisan departments like the EPA, FBI, and even the CDC have been politicized. If representatives believe an agency is overstaffed and overfunded, they might propose changes to meet their political needs.

Even if these provisions die in committee or on the House floors, they are still nerve-wracking for employees who work for government organizations. 

Don’t Let Partisan Politics Affect Your Federal Retirement

While it’s unlikely that the Holman Rule will be used to pass amendments related to agency staffing and salaries, it serves as a reminder of the delicate balance many federal employees walk. Both parties are guilty of changing staffing and funding of various organizations to meet their political needs. One year your budget is slashed, and the next year it sees a significant increase. Even large agencies like the United States military aren’t immune from political fluctuations.

You can’t control Congress, but you can control your own actions and finances. Take steps to make sure you’re saving enough to get you through any rough patches while preparing for federal retirement. The team at MyFedBenefits can help.

We have a team of dedicated benefits specialists who can look at your situation and make suggestions for a stronger financial future. They can help you prepare to retire, even if your salary is slashed to one dollar. Contact us today.