The tax cut President Obama was expected to sign Friday will not include a payroll tax deduction for all federal employees.

Employees under the Federal Employees Retirement System will see their contributions into Social Security drop from 6.2 percent to 4.2 percent in 2011 as part of a payroll tax holiday. But Civil Service Retirement System employees — who do not pay into Social Security — will not see a similar cut in their 7 percent contributions into their retirement system.

The National Treasury Employees Union objected, and said the exclusion of CSRS employees “fails an important test of fairness.”

“CSRS-covered federal employees … should have received a similar or equivalent benefit, particularly since they work side by side with those under FERS,” NTEU President Colleen Kelley said in a Dec. 17 statement. “This additional take-home pay is particularly important in light of the pay freeze for federal employees proposed by President Obama.”

Full story from Federal Times