The Federal Adjustment of Income Rates Act (FAIR Act) proposes to increase federal employee pay in 2025 through multiple mechanisms. The bill would raise base pay for federal workers under statutory pay systems by 4.0 percent and increase locality pay, which adjusts salaries based on regional cost of living, by 3.4 percent. Additionally, it would raise pay for prevailing wage employees, typically federal construction and trade workers, by 4.0 percent in fiscal year 2025. Together, these adjustments would result in an average pay increase of approximately 7.4 percent for affected federal employees. The legislation was introduced by a bipartisan group of representatives in January 2024 and would take effect during calendar year 2025.