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Energy Secretary Announces Contractor Pay Freeze

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Secretary of Energy Steven Chu, Photo: energy.gov

Secretary of Energy Steven Chu announced late last week a two-year pay freeze for the more than 75,000 contractors who work for the Department of Energy.

The move follows President Barack Obama’s proposed two-year pay freeze for federal civilian workers.

Chu said it’s now time for contractors to begin making a sacrifice as well.

“As our nation continues to recover from these challenging economic times, households and small businesses across the country are making sacrifices,” he said. “In this spirit, we are asking our contractor employees, who are doing important research, operations and environmental cleanup work, to join the federal workforce in playing a part.”

The freeze, which takes effect Jan. 1, applies to site and facility management contractor employees, who manage day-to-day operations at DOE’s 28 facilities, including its national laboratories.

If facilities have already approved contractor pay raises, the freeze is set to take effect at the beginning of the next pay cycle and then last two years.

Still, Chu said the sacrifice in pay would not affect DOE’s mission.

“Our national labs, the country’s crown jewels for leading research and development, will continue to attract and retain the nation’s top scientists,” he said, “and pursue some of the most important discoveries that will lead us into the 21st century.”

The move is especially significant as DOE has one of the largest contractor workforces in the federal government. Its outsourced population outstrips its own staff by sizable margins, according to Government Executive.

While the freeze is almost to raise eyebrows in the government-contracting world, Gov Exec reports it’s not the first time DOE’s contractors have been put in the spotlight. The agency’s management of its contracts has been on the Government Accountability Office’s list of high-risk federal programs for 20 years.


  1. Why is President Obama’s freeze called “proposed” while Director Chu’s is mandatory. We were promised our pay raises on 4/1/11 and now were told there is a 2-year freeze. The Director is doing nothing to curb high fuel costs (an increase in our cost of living) and now he won’t even allow a pay raise to make up for some of the loss of buying power. The savings on the national debt will be minimal, union workers are not affected. So I ask why are the DOE’s M&O workers being targeted? The program will probably lose senior employees to retirement due to frustration and a untrained younger workforce to pick up the slack, that is if they don’t go out into industry where freezes are nonexistent and pay and benefits often superior.

  2. Did you know that the money for the rasies is already in the labs’ budgets? Therefore Dr. Steven Chu cannot fulfill his goal that contractor employees “join with federal employees in making this sacrifice as our nation continues to recover from challenging economic times.”
    When nationwide lab directors asked Chu to allow lab employees raises, Dr. Chu issued principles for each Laboratory to reinvest the funds not put into salary increases and suggested uses to promote sustainability and advance projects through Laboratory Directed Research and Development (LDRD) or other mechanisms.

  3. This was interesting. I still don’t see his decision benefiting the slow economy or really having an impact on balancing the budget. To take raises from employees potentially impacts their spending habits. This would reduce spending, thus impacting the economy.

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