Pay Workers What They’ve Earned Act
H.R. 5628, the Pay Workers What They’ve Earned Act, would expand the federal government’s ability to reimburse people affected by a funding lapse (government shutdown). It adds a new provision to 31 U.S.C. 1341 to establish who qualifies as a “covered employee,” what counts as a “shutdown cost,” and how and when reimbursements should be paid. It also creates a dedicated Reserve Fund in the Treasury to finance these reimbursements and provides a process for federal employees, DC public employees, federal contractors (and their employees), and states to receive payment after a shutdown ends, subject to appropriations. In short, the bill aims to repay out-of-pocket expenses and missed income caused by a shutdown and to reimburse certain state expenditures related to federal aid programs during long shutdowns. Key elements include defining who is eligible for reimbursement, what costs can be reimbursed (including loan and credit card costs and interest), how and when payments are made (starting with the lapse beginning Oct 1, 2025, and for other long lapses of 14 days or more), the process for applying for reimbursement, and the creation of a dedicated fund to pay these costs as long as appropriations are available.
Key Points
- 1Who qualifies and what costs are reimbursed
- 2- Covered employees include: federal employees or DC public employees furloughed due to a lapse in appropriations; excepted employees who must work during the lapse; and federal contractors or their employees placed on unpaid leave due to the lapse.
- 3- Shutdown costs are defined broadly to include expenses from loans, credit cards, and any fees or interest arising because the employee cannot be paid during the lapse.
- 4Payment timing for the initial lapse and subsequent long lapses
- 5- For the lapse beginning around October 1, 2025, covered employees are to be paid for shutdown costs as soon as practicable after enactment and once appropriations acts end the lapse.
- 6- For other lapses lasting 14 days or longer, covered employees are to be paid for shutdown costs as soon as practicable after the lapse ends, subject to available appropriations.
- 7State reimbursements
- 8- States that incur expenditures to fund federally funded assistance programs during a 14+ day lapse can be reimbursed by the federal government within 90 days after the lapse ends.
- 9- Reimbursement is not duplicative of amounts covered by other federal law (e.g., unemployment compensation or other existing reimbursements).
- 10Application and verification process
- 11- Individuals or States must apply to the Secretary of the Treasury within one year after the lapse ends.
- 12- The Secretary determines what documentation is needed to verify shut-down costs or expenditures, and approvals authorize reimbursement.
- 13Funding mechanism
- 14- A Reserve Fund for Employees Affected By Government Shutdowns would be established in the U.S. Treasury, funded with appropriations after enactment.
- 15- Amounts in the Fund would be available to pay shutdown costs during future lapses, subject to available appropriations.