OMB Memo Casts Doubt on Federal Workers' Back Pay Amid Ongoing Government Shutdown

Uncertainty Grips Federal Workforce as Shutdown Continues

As the United States federal government enters its second week of a shutdown, a new directive from the White House Office of Management and Budget (OMB) has introduced significant uncertainty regarding back pay for federal employees. The OMB's revised guidance suggests that workers may not be automatically entitled to retroactive pay, a stance that appears to contradict the Government Employee Fair Treatment Act of 2019. This development has sparked concern among lawmakers and federal employee unions, with approximately 900,000 federal employees furloughed and another 700,000 working without pay since October 1, 2025.

The Ongoing Government Shutdown

The current federal government shutdown commenced at 12:01 a.m. EDT on October 1, 2025, following Congress's failure to pass appropriations legislation for the 2026 fiscal year. This marks the 21st funding gap and 11th government shutdown in modern U.S. history. The stalemate stems from partisan disagreements over federal spending levels, foreign aid rescissions, and health insurance subsidies. Many agencies and departments have closed their doors, with the shutdown stretching into its seventh day as of October 7, 2025.

The Government Employee Fair Treatment Act of 2019

In the wake of the 2018-2019 partial government shutdown, Congress passed the Government Employee Fair Treatment Act of 2019 (GEFTA), also known as Public Law 116-1. This law was enacted to ensure that federal employees affected by a lapse in appropriations would receive retroactive pay and leave accrual. Specifically, it mandates that 'upon enactment of appropriations to end a lapse, both furloughed and excepted employees will be paid retroactively as soon as possible after the lapse ends, regardless of scheduled pay dates.' The Act explicitly applies to 'any lapse in appropriations that begins on or after December 22, 2018,' aiming to eliminate uncertainty for employees in future shutdowns.

OMB's Contradictory Stance

On Friday, October 3, 2025, the OMB quietly revised its 'Frequently Asked Questions During a Lapse in Appropriations' document, removing explicit references to the 2019 GEFTA law. The updated guidance now states that only 'excepted employees' who are forced to work without pay are guaranteed back pay at the conclusion of a lapse in appropriations. A draft memo from Mark Paoletta, OMB's general counsel, further argues that the 2019 law is not 'self-executing' and that any legislation ending the current shutdown must include specific language appropriating funds for back pay. Without such explicit language, the OMB suggests, payments cannot be made.

Reactions and Implications

This interpretation by the OMB directly conflicts with the understanding of the 2019 law by many lawmakers and the Office of Personnel Management (OPM). OPM's shutdown guidance, last updated on September 28, 2025, continues to state that furloughed workers will receive retroactive pay. Senator Chris Van Hollen (D-Md.), a co-author of the 2019 measure, asserted that 'The law is the law' and leaves no room for alternative interpretations. House Democratic leaders have echoed this sentiment, stating the law is clear. Critics view the OMB's move as a 'strong-arm tactic' by the administration to pressure Congress into reopening the government. President Trump's own statements on the matter have been ambiguous, noting that back pay 'depends on who we're talking about.' The current situation leaves over 620,000 federal employees furloughed facing significant financial uncertainty.