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Government Shutdown Looming October 1: Three Moves for Federal Employees to Make Now

back pay federal employees government shutdown mspb rif Jul 20, 2026

A government shutdown could begin as soon as October 1, 2026, and federal employees who wait until the fiscal year ends to prepare may find themselves scrambling. Congress has passed only two of the twelve annual appropriations bills that fund federal agencies, and lawmakers are scheduled to be in session for only a few weeks in September before turning to the November elections. The federal government has already experienced three funding lapses in the past year, including a record-setting one, so the possibility of another lapse is not a remote scenario — it is a matter of calendar.

Where Funding Stands as the Fiscal Year Ends

The federal fiscal year ends September 30. As of this week, the House has passed just 2 of the 12 annual appropriations bills that fund the government, and the Senate has passed none. With Congress scheduled to be in session for only about four weeks in September before the November elections consume the calendar, the window to finish the remaining bills, or pass a stopgap, is narrow.

Three Moves to Make Before October 1

Build a Cash Cushion Now, While the Checks Are Still Coming

Back pay after a shutdown is guaranteed by law under the Government Employee Fair Treatment Act, 31 U.S.C. § 1341(c). But guaranteed back pay is not the same as uninterrupted pay: it arrives after the lapse ends, not during it. Your bills do not pause for a shutdown, even though your paycheck might. Building a cushion now, while pay is still coming in, is the most direct way to blunt the impact of a lapse.

Confirm Whether You Are Excepted or Furloughed

Employees designated as “excepted” continue working without pay until a lapse ends. Employees who are furloughed are sent home. Your agency’s shutdown contingency plan already specifies which category applies to your position — ask your supervisor or human resources office now, before October, rather than finding out on the first morning of a lapse.

Watch What Happens to Your January 2027 Pay Raise

The general government spending bill is the usual vehicle for setting the following year’s federal pay raise. This year, that bill is on track to say nothing on the subject. When Congress is silent, the President’s alternative pay plan controls under 5 U.S.C. § 5303 — the same mechanism that produced this year’s 1 percent raise. Right now, the pending proposal for January 2027 is zero for most employees, with a possible increase only for certain law enforcement positions.

When a Shutdown and a RIF Overlap

A government shutdown is sometimes paired with a reduction in force. A RIF is appealable to the Merit Systems Protection Board, but the filing clock is short, generally 30 days from the effective date of the action. Save and date every notice you receive, whether it relates to furlough status, excepted status, or a RIF, so you have a clear record if you need to act quickly.

The bottom line: none of this requires panic, but it does require attention. Confirm your status, build what cushion you can, and keep records of anything your agency sends you between now and September 30.

If you have questions about how a shutdown or a possible RIF could affect your specific position, stay in the loop with Southworth PC's free newsletter.

Legal Disclaimer: This content is for general informational purposes only and does not constitute legal advice. Federal employment situations are fact-specific and time-sensitive. Please consult a qualified federal employment attorney about your specific situation.

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