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Lawrence: Welcome to The FED Weekly
for 2-8 November 2025, your essential

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weekly briefing on the policies
and proposals shaping your career,

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your benefits, and your retirement.

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Whether you’re a current federal employee
navigating changes in the civil service,

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or a retiree keeping a close watch on your
hard-earned pension and healthcare, this

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is your source for the latest news from
Capitol Hill and the executive branch.

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Each week, we cut through the noise to
bring you the critical updates on budget

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negotiations, pay raises, workforce
policies, and the legislative battles that

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directly impact the federal community.

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Let's get you up to speed on
what happened this past week.

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The Government Shutdown Enters
Month Two—Judicial Rulings

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and 2026 Benefit Decisions

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The immediate backdrop to this
analysis is the immense financial

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duress faced by the federal workforce.

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Employees have now missed two full
paychecks, compelling hundreds

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of thousands to rely on credit
cards, visit food pantries, and

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liquidate personal assets just
to cover basic living expenses.

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The crisis is acutely felt by
"excepted" personnel, such as Cynthia

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Brown, a staffer at the Government
Publishing Office who has been

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required to work without compensation.

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Her statement reflected the widely
shared frustration with the political

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inertia: “It is going nowhere.

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That is what scares me.

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They hate each other so much, and
we — we are just caught in the middle”.

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The legislative deadlock continues,
driven by clashing demands between

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Democrats, who seek to extend Affordable
Care Act subsidies, and Republicans,

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who refuse to negotiate on health care
until the government has reopened.

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The analysis of this tumultuous
week is structured to address

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the complex layers of impact.

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First, we examine provisions and
crises that affect both current

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and retired federal staff.

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Second, we focus on news
specific to retirees, including

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finalized 2026 Cost-of-Living
Adjustments and Medicare policies.

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Finally, we analyze the major
employment and pay decisions

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unique to the active workforce.

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Issues That Affect Current
and Retired Federal Workers

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The political standoff that triggered
the shutdown on October 1, 2025,

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remains fully entrenched, fueled by
partisan disagreement over health care

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policy and overall funding levels.

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Congress continued to fail in
resolving the appropriation

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lapse during this period.

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The Senate, requiring 60 votes to
advance most legislation, voted 13

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times on a House-passed resolution
designed to fund the government until

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November 21, but fell short of the
necessary threshold, leaving roughly

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730,000 federal employees classified
as "excepted" working without pay.

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Amidst this paralysis, legislative
proposals emerged to alleviate

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the burden on working employees.

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The Shutdown Fairness Act (S.

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3012) was actively debated.

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This bill seeks to provide immediate
appropriations to ensure that federal

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agencies can pay their excepted employees
(and certain supporting contractors)

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during the ongoing lapse in funding.

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The introduction and promotion of S.

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3012 highlights a fundamental,
practical difference in employee

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compensation during a shutdown.

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While the Government Employee Fair
Treatment Act (GEFTA) of 2019 historically

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ensures that both furloughed and
excepted employees receive retroactive

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pay after a shutdown ends , S.

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3012 specifically targets
immediate compensation for those

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required to report to work.

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The continued necessity of introducing
such immediate pay legislation

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underscores the lack of reliable
funding mechanisms for core governmental

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functions during extended lapses.

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A major controversy that introduced
profound financial uncertainty for

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all furloughed workers was revealed
during this reporting period.

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An October 2025 draft memo, penned by
the Office of Management and Budget’s

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(OMB) general counsel, Mark Paoletta,
and addressed to Director Russell Vought,

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questioned the automatic guarantee of
retroactive pay for furloughed employees.

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The OMB position argued that the GEFTA
did not automatically ensure post-shutdown

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pay for furloughed employees, asserting
instead that Congress must include

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explicit, express language appropriating
funds for back pay within any legislation

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used to end the government lapse.

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Although the administration had not
officially adopted this position

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to withhold retroactive pay,
the very existence of this legal

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interpretation signals a potential
shift in the executive branch’s

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strategy toward the civil service.

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Historically, GEFTA has been understood
to guarantee pay , but this new

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legal opinion introduces a risk that
the executive branch could use the

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withholding of guaranteed compensation
as leverage in budget negotiations,

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dismantling a key, established civil
service protection by demanding fresh

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appropriations for standard actions.

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The severity of the shutdown escalated
for millions of Americans, including

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vulnerable federal employees and
retirees, when funds for the Supplemental

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Nutrition Assistance Program (SNAP)
were set to expire on November 1, 2025.

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The administration had reversed its prior
stance, claiming it was prohibited from

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utilizing a $5 billion contingency fund
specifically allocated by Congress to keep

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benefits flowing during funding lapses.

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This decision prompted
immediate legal action.

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On October 28, 2025, New York
Attorney General Letitia James and

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a bipartisan coalition of 26 state
leaders, including the District of

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Columbia, filed a lawsuit against
the Department of Agriculture (USDA).

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The coalition argued that the refusal
to issue November SNAP payments to more

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than 40 million Americans—a population
that includes countless families relying

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on this lifeline—was unlawful, as the
USDA was legally required to continue

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benefits using existing contingency funds.

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The litigation came to a head on
Friday, October 31, 2025, just one day

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before the critical payment deadline.

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Two federal judges intervened to
block the imminent lapse of benefits.

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U.S.

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District Judge Indira Talwani
in Massachusetts rejected the

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administration's argument that
the contingency funds could

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not be used, ruling that the
government is legally required to

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tap into the emergency resources.

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Simultaneously, U.S.

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District Judge John J.

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McConnell, Jr.

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in Rhode Island granted a temporary
restraining order, specifically

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directing the USDA to distribute the
contingency funds to ensure full SNAP

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payments by the following Monday, or at
minimum, partial payments by Wednesday.

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These rulings affirmed the states’
position that the USDA was legally

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obligated to use the existing funds.

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This chain of events demonstrated the
judiciary’s function as an emergency

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financial safeguard, mitigating the
immediate humanitarian threat that 42

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million individuals—including families
connected to the federal workforce—would

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have faced on November 1, 2025, due to
executive interpretation of funding law.

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However, on November 7, 2025, a Supreme
Court justice has temporarily paused the

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lowers court's ruling requiring the Trump
administration to fully fund the SNAP

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program by the end of the day Friday.

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In an order late Friday night, Justice
Ketanji Brown Jackson said the pause

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will remain in effect until the 1st U.S.

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Circuit Court of Appeals issues
a judgment on the matter.

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Jackson is the justice assigned to
emergency applications out of the 1st

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circuit, and her order did not refer
the matter to the full Supreme Court.

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As the court battle played out
through the day Friday, at least nine

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states had already begun issuing SNAP
benefits under the direction of the

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federal agency that operates SNAP.

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The most significant financial news
affecting both current employees and

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retirees was the announced increase
in Federal Employees Health Benefits

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(FEHB) program premiums for 2026.

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While the announcement by the
Office of Personnel Management (OPM)

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occurred earlier in October, the
consequences continued to dominate

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financial planning during this period.

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The average enrollee share for
FEHB will rise sharply by 12.3

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percent.

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For participants in the newly established
Postal Service Health Benefits

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(PSHB) program, the average enrollee
increase is slightly lower at 11.3

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percent.

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This substantial increase marks the
continuation of a trend of escalating

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costs, following surges of 13.5

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percent in 2025, 7.7

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percent in 2024, and 8.7

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percent in 2023.

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OPM attributes the accelerating cost
pressures to multiple factors, primarily

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the relatively older average age of
enrollees (47 for active workers; 60

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when retirees are included), coupled
with rising costs for prescription

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drugs and general medical services.

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This premium hike occurs just ahead of
the critical planning window for the

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upcoming Open Season, scheduled for
November 10 through December 8, 2025.

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For those in plans that are terminating at
the end of 2025, a crucial administrative

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detail dictates that they must make an
active election into a new FEHB plan.

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Failure to do so will result in default
enrollment into the lowest-cost nationwide

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option for 2026, as determined by OPM.

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For the combined federal workforce
(active and retired), the 12.3

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percent health premium increase
represents a critical erosion

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of effective compensation.

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When juxtaposed against the announced
2026 pay raise for most active

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employees, the cost of coverage is
set to far outstrip any nominal income

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increase, forcing households to make
difficult and potentially restrictive

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health care choices to manage budgets.

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Issues That Affect Retired Federal Workers

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Despite the financial chaos of
the shutdown, the finalized 2026

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Cost-of-Living Adjustments (COLA) for
federal annuitants provided a measure

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of certainty regarding future income.

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The announcement of the COLA,
typically derived from Social Security

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Administration data, was delayed this year
due to the ongoing government shutdown.

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The announced figures reflected
sustained inflationary pressures,

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marking the fifth consecutive year
that the adjustment has been 2.5

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percent or higher for Civil Service
Retirement System (CSRS) beneficiaries.

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The specific 2026 COLA
figures are as follows:

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Civil Service Retirement System
(CSRS) Annuitants: Will receive a 2.8

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percent increase.

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Federal Employees Retirement System
(FERS) Annuitants: Will receive a 2.0

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percent increase.

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New Medicare Physician Fee Schedule
and Health Plan Coordination

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For federal retirees utilizing Medicare,
the Centers for Medicare & Medicaid

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Services (CMS) finalized the Calendar
Year 2026 Medicare Physician Fee

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Schedule (PFS) final rule (CMS-1832-F).

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This rule introduces key revisions to
payment accuracy and care management.

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A significant provision is the
finalization of a modest -2.5

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percent efficiency adjustment
applied to select services, such

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as surgical procedures, diagnostic
imaging, and orthopedic services.

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CMS characterized this adjustment as
a means to modernize payment accuracy

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and reduce unnecessary spending
waste, arguing that these services

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are becoming more efficient over time
due to technological advancements.

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While the agency stated the rule aims to
improve primary care and chronic disease

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management, any reduction in the fee
schedule inherently raises questions

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regarding potential impacts on beneficiary
access or provider participation,

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requiring careful monitoring.

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Furthermore, as the Medicare Open
Enrollment Period (OEP) overlaps

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with the FEHB Open Season, federal
retirees enrolled in both FEHB and

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Original Medicare were reminded of a
critical administrative requirement

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should they wish to enroll in a
private Medicare Advantage (MA) plan.

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To transition to an MA plan, a retiree
must actively suspend their FEHB

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enrollment during the upcoming FEHB
Open Season, which is scheduled from

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November 10 through December 8, 2025.

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For those retirees eligible for
premium-free Medicare Part A,

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the Public Employees' Medical and
Hospital Care Act (PEMHCA) mandates

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enrollment in both Parts A and B.

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This continued complexity in
coordinating dual benefit streams

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highlights the enduring challenge
faced by retirees in navigating

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rising health costs and multiple,
overlapping enrollment deadlines.

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On the administrative front, OPM
announced new efforts on October 30,

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2025, aimed at streamlining services
for former employees through "Faster,

00:13:20.000 --> 00:13:22.540
Paperless Options for Federal Retirees".

00:13:23.119 --> 00:13:27.139
The continuity of these essential
administrative functions, such as TSP

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management and OPM digitization efforts,
provides a notable contrast to the severe

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operational and financial disruption
experienced by the active, non-excepted

00:13:37.840 --> 00:13:40.100
federal workforce during the shutdown.

00:13:40.711 --> 00:13:43.181
Issues That Affect Current Federal Workers

00:13:43.769 --> 00:13:47.670
The most critical development for the
active federal workforce during this

00:13:47.670 --> 00:13:52.149
period was the successful judicial
defense against attempts to use the

00:13:52.149 --> 00:13:56.229
government shutdown as an opportunity
to reduce the federal workforce.

00:13:57.050 --> 00:14:00.489
The shutdown has been marked by
direction from the Office of Management

00:14:00.489 --> 00:14:05.420
and Budget (OMB) for agencies to
consider issuing Reduction in Force

00:14:05.619 --> 00:14:09.940
(RIF) notices to employees in programs
with lapsed discretionary funding

00:14:10.080 --> 00:14:13.569
that were deemed inconsistent with
the administration's priorities.

00:14:14.559 --> 00:14:18.609
Reports indicated that over 4,000
federal workers were targeted

00:14:18.609 --> 00:14:20.359
for RIFs during the shutdown.

00:14:21.280 --> 00:14:25.699
OMB deemed that agencies were authorized
to direct employees to perform the

00:14:25.699 --> 00:14:30.839
work necessary to administer RIF
processes as an "excepted activity"

00:14:31.030 --> 00:14:32.859
during the lapse in appropriations.

00:14:33.503 --> 00:14:39.474
However, on Monday, October 28, 2025,
a federal court intervened decisively.

00:14:39.893 --> 00:14:40.273
U.S.

00:14:40.273 --> 00:14:42.953
District Judge Susan Illston of the U.S.

00:14:42.953 --> 00:14:46.314
District Court for the Northern
District of California granted a

00:14:46.314 --> 00:14:50.304
request from a coalition of labor
unions for a preliminary injunction.

00:14:50.343 --> 00:14:54.943
This court order explicitly prohibits the
administration from issuing new RIFs or

00:14:54.943 --> 00:14:59.134
implementing RIFs that had already been
filed while the government remains shut

00:14:59.134 --> 00:15:01.744
down and the related litigation proceeds.

00:15:02.533 --> 00:15:06.423
The lawsuit leading to this landmark
injunction was filed by a large coalition

00:15:06.423 --> 00:15:10.193
of unions, including the American
Federation of Government Employees

00:15:10.403 --> 00:15:16.774
(AFGE), the National Treasury Employees
Union (NTEU), the National Federation

00:15:16.774 --> 00:15:19.873
of Federal Employees (NFFE), and others.

00:15:20.526 --> 00:15:23.446
The preliminary injunction
served as a vital protective

00:15:23.446 --> 00:15:25.445
measure for the active workforce.

00:15:26.026 --> 00:15:30.475
It directly challenged the executive
branch's use of a funding lapse to

00:15:30.475 --> 00:15:34.486
execute mass terminations, thereby
preserving the stability and

00:15:34.486 --> 00:15:36.996
integrity of the career civil service.

00:15:37.695 --> 00:15:41.496
Advocacy groups characterized the
ruling as a significant setback to

00:15:41.496 --> 00:15:45.685
efforts targeting career public servants
under the guise of the shutdown,

00:15:46.246 --> 00:15:50.045
temporarily stabilizing the employment
status of thousands of federal

00:15:50.045 --> 00:15:52.396
workers facing immediate job loss.

00:15:53.021 --> 00:15:56.882
The Finalized 2026 Pay
Structure and Locality Freeze

00:15:57.491 --> 00:16:01.001
While the active workforce struggled
through the ongoing pay lapse,

00:16:01.291 --> 00:16:05.261
the details of their compensation
for 2026 were confirmed following

00:16:05.261 --> 00:16:10.021
the Alternative Pay Plan issued by
the President on August 28, 2025.

00:16:10.922 --> 00:16:15.691
This finalized structure reveals a
stark divergence in planned compensation

00:16:15.691 --> 00:16:17.372
across the federal workforce:

00:16:18.007 --> 00:16:22.038
The majority of federal employees under
the General Schedule (GS) and related pay

00:16:22.038 --> 00:16:25.007
systems are slated to receive a modest 1.0

00:16:25.007 --> 00:16:26.207
percent base increase.

00:16:26.858 --> 00:16:33.617
Simultaneously, OPM was directed to freeze
2026 locality rates at their 2025 levels.

00:16:34.275 --> 00:16:38.085
In contrast, the plan mandates
the use of special pay authorities

00:16:38.085 --> 00:16:39.725
to provide an additional 2.8

00:16:39.725 --> 00:16:43.076
percent increase for certain law
enforcement officials (LEOs),

00:16:43.435 --> 00:16:45.916
resulting in an overall raise of 3.8

00:16:45.916 --> 00:16:50.235
percent, which is designed to match
the expected military pay increase.

00:16:51.135 --> 00:16:56.055
OPM will use Special Salary Rates (SSRs)
to achieve this targeted increase.

00:16:56.795 --> 00:17:01.326
SSRs are intended to address significant
recruitment or retention problems, and

00:17:01.326 --> 00:17:05.695
their application here is specifically
linked to supporting law enforcement

00:17:05.695 --> 00:17:10.715
personnel crucial to the President’s
strategy regarding border security.

00:17:11.371 --> 00:17:13.772
This pay structure, with a 1.0

00:17:13.772 --> 00:17:17.612
percent general base raise and
frozen locality pay, represents a

00:17:17.612 --> 00:17:21.061
notable departure from the customary
alignment of federal employee

00:17:21.061 --> 00:17:23.522
raises with military increases.

00:17:24.082 --> 00:17:27.611
When this low general increase
is weighed against the high 12.3

00:17:27.611 --> 00:17:32.301
percent FEHB premium hike (discussed
in Section 1) and the higher

00:17:32.301 --> 00:17:34.822
inflation rate indicated by the 2.8

00:17:34.822 --> 00:17:39.641
percent CSRS COLA (discussed in Section
2), the majority of the active federal

00:17:39.641 --> 00:17:44.951
workforce faces a significant decline
in real net compensation for 2026.

00:17:45.631 --> 00:17:47.911
The highly targeted nature of the 3.8

00:17:47.911 --> 00:17:54.172
percent raise for LEOs risks exacerbating
morale and retention issues across non-law

00:17:54.172 --> 00:17:56.021
enforcement sectors of the government.

00:17:56.779 --> 00:17:59.259
Continuing Pressure on Workplace Posture

00:17:59.834 --> 00:18:04.633
The focus on restricting telework and
enforcing a return to the office remained

00:18:04.633 --> 00:18:09.634
a dominant policy theme, even amidst the
operational disruption of the shutdown.

00:18:10.134 --> 00:18:13.744
The existing Presidential Memorandum
on "Return to In-Person Work"

00:18:14.103 --> 00:18:18.624
continues to guide agency policies,
requiring a substantial increase

00:18:18.624 --> 00:18:20.124
in meaningful in-person work.

00:18:20.891 --> 00:18:23.832
Although Congress did not act on
the matter during this specific

00:18:23.832 --> 00:18:28.172
week, the previously House-passed
SHOW Up Act of 2023 (H.R.

00:18:28.172 --> 00:18:31.751
139) continues to signal
legislative intent.

00:18:32.412 --> 00:18:36.322
This bill would mandate executive
agencies to revert to their pre-December

00:18:36.322 --> 00:18:42.142
31, 2019, telework policies and
require OPM certification that

00:18:42.171 --> 00:18:46.311
any expanded telework positively
affects agency mission and costs.

00:18:46.972 --> 00:18:50.782
Administration officials and department
leaders, including those preparing

00:18:50.782 --> 00:18:55.572
to staff the Department of Government
Efficiency, have explicitly articulated

00:18:55.572 --> 00:19:00.782
goals of implementing five-day, in-office
requirements to meet the stated objective

00:19:00.782 --> 00:19:02.701
of trimming the federal workforce.

00:19:03.451 --> 00:19:07.192
The structural connection between
mandated return-to-office policies

00:19:07.401 --> 00:19:12.471
and explicit workforce reduction goals
suggests that telework restrictions

00:19:12.471 --> 00:19:16.721
are being utilized strategically, not
only for real property optimization

00:19:17.002 --> 00:19:21.752
but also as an implicit mechanism to
encourage attrition among employees who

00:19:21.752 --> 00:19:24.101
depend on flexible work arrangements.

00:19:24.703 --> 00:19:27.953
And that’s a wrap on this week’s
Federal Workforce Roundup.

00:19:28.604 --> 00:19:32.893
The landscape for federal employees
and retirees is constantly shifting,

00:19:33.224 --> 00:19:37.323
with major decisions being made about
everything from pay and job security

00:19:37.613 --> 00:19:41.413
to retirement benefits and the very
structure of the civil service.

00:19:41.983 --> 00:19:43.973
Staying informed is your best tool.

00:19:44.573 --> 00:19:49.063
Be sure to subscribe wherever you get your
podcasts, so you never miss an update.

00:19:49.769 --> 00:19:50.879
Thanks for tuning in.

00:19:51.049 --> 00:19:53.989
We’ll be back next week to
track the latest developments

00:19:53.989 --> 00:19:55.279
and what they mean for you.

00:19:55.720 --> 00:19:58.489
Until then, stay engaged and be well.