The FED Weekly

The second week of July 2025 brought seismic shifts to the U.S. federal workforce, marked by a coordinated effort to reshape the civil service. A landmark Supreme Court ruling on July 8 cleared the way for the administration to proceed with mass layoffs, known as Reductions-in-Force (RIFs), across the government.President Trump signed the "One Big Beautiful Bill Act" (OBBB) on July 4. While severe proposed cuts to Federal Employees Retirement System (FERS) benefits, such as increased contributions and moving from a high-3 to high-5 annuity calculation, were excluded from the final bill , the OBBB’s passage made a 2026 civilian pay freeze highly probable, as it included no provision for a raise. The OBBB did introduce benefit enhancements, including expanded Health Savings Accounts (HSAs) and increased Dependent Care FSA limits starting in 2026.Scott Kupor was confirmed as the new OPM Director. OPM is implementing a drastic overhaul of performance management, encouraging 30-day Performance Improvement Plans and expediting removals, weakening job protections. Additionally, a government-wide executive order is mandating a full return to the office, ending expanded telework. Retirees face a steep 13.5% average increase in 2025 FEHB premiums.

During the week of June 29 to July 5, 2025, major federal legislative developments preserved key benefits for current and retired federal employees. The Senate version of H.R. 1, the “One Big Beautiful Bill,” removed all proposed cuts to pensions and health benefits previously included in the House version, including elimination of the FERS supplement and shifting annuity calculations to a “high-5” salary basis. NARFE declared this a victory for federal workers and retirees. Additionally, the Social Security Fairness Act (H.R. 82), which repealed the Windfall Elimination Provision (WEP) and Government Pension Offset (GPO), has increased Social Security benefits for over 2.8 million affected retirees, with back payments issued to January 2024.On the workforce front, job changes slowed, a DoD pay freeze affected 60,000 blue-collar workers due to suspended wage panels, and controversial hiring questions were dropped from applications. A court also blocked an executive order aiming to strip union rights from federal employees. The Federal Retirement Fairness Act (H.R. 1522) was reintroduced to allow service credit purchases for prior noncareer work. For retirees, no changes were made to FEHBP or survivor benefits, and OPM’s digital retirement system, launching mid-July, aims to reduce processing delays.

Welcome to the FED Weekly, the go-to podcast for current and retired U.S. federal employees who need to stay informed on the issues that matter most. In a rapidly changing political landscape, we deliver concise, weekly updates on the legislative, executive, and agency-level actions that have a direct impact on your professional life and financial future.

The FED Weekly: June 15–21, 2025 report highlights significant developments impacting federal employees and retirees. A major focus is the Senate’s draft of a budget reconciliation bill that preserves controversial measures requiring new federal employees to either pay a higher retirement contribution or forfeit civil service protections. While some proposed retirement cuts were removed—like the switch to a “high-5” pension calculation and elimination of the FERS annuity supplement—provisions granting the President expansive authority to reorganize agencies remain. Federal employee unions have sharply criticized the bill, calling it a threat to merit-based service.In a legal victory, a federal court blocked OPM from sharing personnel data with the new Department of Government Efficiency, citing privacy concerns. Meanwhile, OPM has rolled back telework policies and implemented stricter performance standards across federal agencies.The Department of Veterans Affairs and the Department of Defense are both undergoing large-scale workforce reductions, despite union warnings of negative impacts. At the same time, a Supreme Court ruling expanded differential pay rights for federal reservists, potentially triggering new back pay claims.For retirees, the Social Security Fairness Act's repeal of the WEP and GPO is being implemented, increasing benefits for millions. The Senate’s decision not to include further retirement cuts offers temporary relief to retirees, although advocacy groups remain cautious about future legislative risks.

Welcome to the Federal Workforce Roundup, the go-to podcast for current and retired U.S. federal employees who need to stay informed on the issues that matter most. In a rapidly changing political landscape, we deliver concise, weekly updates on the legislative, executive, and agency-level actions that have a direct impact on your professional life and financial future.

The first week of June 2025 brought several important developments for the federal community. Below is a roundup of key news affecting U.S. federal employees and retirees, organized by category for clarity.