How Do Government Shutdowns Impact Federal Employees & Agencies?

In recent years, government shutdowns have been a regular part of life for many federal employees as Congress works to avoid defaulting. As we move closer to 2022, fears of another government shutdown are mounting, and the Office of Management and Budget has begun issuing statements to agencies telling them to start planning for a shutdown.

If you're a federal employee, understanding how a shutdown could impact you - and whether the impact will be different than in previous years - can help you plan for the future.

To schedule a consultation with our federal employment attorneys for your case, contact us online or via phone at (202) 759-7780.

Why Do Government Shutdowns Happen?

In short, shutdowns happen when Congress fails to fund the government, but that's simplifying matters a lot.

The Antideficiency Act, passed into law in 1884 and amended in 1950 and 1982, prohibits the U.S. government from entering into contracts that are not "fully funded."

Congress is required to pass funding legislation that finances the government. This includes authorizing the finances that pay for government employees to do their jobs. It also includes approving the Treasury Department to pay its bills. For the most part, the U.S. operates in a deficit, so passing funding legislation usually also involves raising the debt limit for the U.S.

Here's where we come back to the Antideficiency Act. Essentially, due to a 1980 interpretation of the Act and what constitutes a "fully funded" contract, the government shuts down if Congress can't pass its annual funding legislation.

Why Would the Government Shut Down This Year?

As federal employees know, a government shutdown this year would hardly be anything new. For the past three years, the government has gone into annual shutdowns. In fact, the longest shutdown in government history happened just recently, lasting from December 22, 2018, until January 25, 2019.

This year, Republicans - led by Senate Minority Leader Mitch McConnell - are refusing to raise the debt ceiling as part of the funding legislation. The argument from the Republican party is that, since the Democrats are also trying to pass a $3.5 trillion bill to restructure the government, they should have to muster the votes to raise the debt ceiling on their own. It's a break from tradition - the debt ceiling has traditionally been a bipartisan issue.

Democrats are attempting to pass funding legislation using a number of tactics, including wrapping it in with environmental disaster relief, but it remains to be seen whether they will be successful or not.

What Would a Shutdown Mean for Federal Employees?

Like other recent shutdowns, a government shutdown could mean that many federal employees are furloughed, relieving them from having to attend work until funding legislation is passed - and also relieving them of pay. During past shutdowns, many employees have suffered, having to drain their personal savings to stay afloat while furloughed.

Other federal and state employees, such as members of the military and law enforcement agencies - along with other "essential" agency employees such as TSA agents and air traffic controllers - would need to report to work without receiving any payment.

Government shutdowns also have wide-reaching effects on American citizens. In past shutdowns, processes such as loan applications have slowed drastically or even stopped due to shutdowns. Federally maintained spaces, such as national parks, have had to go unmaintained, and food safety inspections have stopped. A government shutdown this year would likely mean similar consequences.

It would be remiss to end this blog without mentioning the potential economic ramifications of a shutdown. With the U.S. still teetering on the edge of recovery thanks to the COVID-19 pandemic, a shutdown could mean plunging the country into a recession, eliminating the progress that has been made thusfar in the country's economic recovery since 2020.

Needless to say, a government shutdown in 2021 could impact federal employees and American citizens alike in various negative ways.

At John P. Mahoney, Esq., Attorneys at Law, we're here to help federal employees understand and protect their rights. If you're dealing with a legal dispute related to your job, we're here to help.

To schedule a consultation with our experienced federal employment attorneys for your case, contact us online or via phone at (202) 759-7780.