The U.S. House of Representatives and Senate have until midnight on Friday, Jan. 19, to pass either an appropriations bill or an additional continuing resolution to avert government shutdown. And with critical issues such as the Deferred Action for Childhood Arrivals statuses and border wall funding still up in the air, a shutdown is still a significant possibility.

Unlike what the name suggests, the federal government doesn’t fully shut down during a government shutdown and employees face a variety of uncertain outcomes as a result. In the event of a shutdown, federal employees will generally fall into one of three categories: furloughed, excepted or exempted.


Nearly all federal employees that are deemed non-emergency and rely on yearly appropriations for their paychecks would be furloughed in the event of a shutdown, meaning that they cannot come into work and will be without pay for the duration of the shutdown.

It is possible that Congress would pass a bill once the government reopens to provide furloughed employees with back pay for the duration of the shutdown, as was the case during the 2013 government shutdown, but employees are not guaranteed this pay.

According to 2015 Office of Personnel Guidance on shutdown furloughs, federal employee health benefits are still in effect during a shutdown.

“The employee’s FEHB coverage will continue even if an agency does not make the premium payments on time. Since the employee will be in a non-pay status, the enrollee share of the FEHB premium will accumulate and be withheld from pay upon return to pay status,” the guidance said.

Retirement benefits would also continue unabated. Under a government shutdown, “federal retirees under the CSRS and FERS retirement systems will still receive their scheduled annuity payments on the first business day of the month,” according to the OPM guidance.

During a shutdown, furloughed employees may apply for unemployment benefits, though the timeline and qualifications for doing so vary by state.

“It is possible that furloughed employees may become eligible for unemployment compensation,” the guidance said. “State unemployment compensation requirements differ. Some states require a 1-week waiting period before an individual qualifies for payments. In general, the law of the state in which an employee’s last official duty station in federal civilian service was located will be the state law that determines eligibility for unemployment insurance benefits.”

Furloughed employees may also face difficulties obtaining outside employment during a shutdown, depending on the rules of the agency they work for, as those individuals are still considered employees of the federal government and “executive branch-wide standards of ethical conduct and rules regarding outside employment continue to apply when an individual is furloughed.”

Personnel on detail to the federal government or contracting with an agency face a more complex question of whether they will continue to work.

“Personnel on detail to federal agencies from non-federal organizations may continue working, provided that the non-federal organizations pay the total costs of the detail,” according to the OPM guidance.

According to an August 2017 Professional Services Council webinar, contractors may receive a stop work order unless funding for the contract remains available outside annual authorizations.


Excepted employees are those deemed essential for emergency operations. These employees are required to come into work, but are not paid during the shutdown period.

“In the context of shutdown furloughs, the term ‘excepted’ is used to refer to employees who are funded through annual appropriations who are nonetheless excepted from the furlough because they are performing work that, by law, may continue to be performed during a lapse in appropriations. Excepted employees include employees who are performing emergency work involving the safety of human life or the protection of property or performing certain other types of excepted work,” the guidance said.

Members of the military, for example, are commonly considered excepted employees, as their work is critical to national security.

However, according to a shutdown document published on the Defense Finance and Accounting Service website, “the Department of Defense has no legal authority to pay any personnel — military or civilian — for the days during which the government is shut down. The shutdown will not affect payments to retirees and annuitants as those funds come from a retirement trust fund.”

In addition, federal employees that provide services on military bases, such as childcare, may not be considered excepted and could create additional strain on military servicemen and women.

Employees who process unemployment forms may also be excepted during a furlough, in order to process forms and requests received by employees out of work. Similarly, employees that process paychecks are likely to be excepted in order to process and deliver paychecks for time worked prior to the shutdown.

Unlike furloughed employees, those federal employees that are excepted and work during a shutdown must be paid for the work they do after Congress passes new appropriations, and are still able to earn premium pay, such as Sunday and night pay, while working under a furlough.

Government shutdowns also have a bizarre effect on paid leave, as employees cannot technically be on any kind of paid status during a furlough. It is therefore possible that an employee who is approved for paid time off coinciding with the shutdown period will be expected to return to work on the day the shutdown begins if they are placed on excepted status.

“All paid time off during a shutdown furlough period must be canceled because the requirement to furlough supersedes leave and other paid time off rights,” the OPM guidance said.

“However, if an excepted employee needs to be absent from work for brief or intermittent periods, agencies are encouraged to explore the use of workplace flexibilities such as alternative work schedules and telework (subject to applicable laws, regulations, agency policies, and collective bargaining agreements) to accommodate this employee’s need to be absent. If use of workplace flexibilities is not appropriate for your situation, excepted employees must be furloughed for any brief or intermittent unpaid absence.”


Some employees will be exempt from the shutdown altogether, as, unlike excepted employees, their pay does not derive from annual appropriations.

According to a 1995 memo issued by then-Assistant Attorney General Walter Dellinger, there are some situations in which the Antideficiency Act, which governs agency authority to draw funds from the Treasury, simply does not apply, meaning that Congress’s failure to pass an appropriations bill does not impact those functions:

  • Multi-year or indefinite appropriations: government operations that do not rely on the annual appropriation of funds are not impacted by a government shutdown. For example, Social Security operates with indefinite appropriations and will still be handing out benefit checks during a shutdown.
  • Express authorizations: Congress provides agencies with the express authority to enter into contracts and borrow money for certain functions, such as the Department of Defense’s “food and forage” authority to contract for necessary clothing, food, supplies, etc.
  • Necessary implications: a limited number of government operations funded through annual appropriations must continue despite a government shutdown, because other functions mandated by law require that these operations continue as well.
  • Emergency services: those government services that involve the safety of human life and the protection of property.

Leave-exempt presidential appointees are among this group, as, according to the OPM guidance, they are entitled to the pay of their offices solely by holding the title and not because of any work done.

“In other words, their compensation is attached to their office, and, by necessary implication of the president’s authority to appoint such employees, their service under such an appointment creates budgetary obligations without the need for additional statutory authorization,” the guidance said.

“Presidential appointees who are covered by the chapter 63 leave system are not considered to be entitled to pay based solely on their status as officers; thus, these individuals are subject to furlough in the same manner as other federal employees.”

Jessie Bur covers federal IT and management.

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