The Federal Adjustment of Income Rates Act, or FAIR Act, seeks to implement a comprehensive pay increase for federal employees in 2026. This legislation specifically addresses adjustments for both statutory pay systems and prevailing rate employees. For calendar year 2026, the bill mandates a 3.3 percent increase in the rates of basic pay for employees under statutory pay systems. Concurrently, it directs a 3.3 percent increase in basic pay for prevailing rate employees for fiscal year 2026, bypassing typical wage survey requirements. Furthermore, the Act includes a separate 1 percent adjustment for locality pay, also effective for calendar year 2026, contributing to the overall compensation increase for federal workers.