The automatic annual adjustment for Members of Congress is determined by a formula using a component of the Employment Cost Index (ECI), which measures rate of change in private sector pay. The adjustment automatically takes effect unless (1) Congress statutorily prohibits the adjustment; (2) Congress statutorily revises the adjustment; or (3) the annual base pay adjustment of General Schedule (GS) federal employees is established at a rate less than the scheduled increase for Members, in which case the percentage adjustment for Member pay is automatically lowered to match the percentage adjustment in GS base pay.2 Under the ECI formula, Members may not receive an annual pay adjustment greater than 5%. In the past, Member pay has been frozen statutorily in two ways: (1) directly, trough legislation that freezes salaries for Members but not other federal employees, and (2) indirectly, through broader pay freeze legislation that covers Members and other specified categories of federal employees. This adjustment formula was established by the Ethics Reform Act of 1989. Votes potentially related to the annual adjustments since the implementation of this act are contained in this report.
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