Senate Democrats introduced last week new legislation last to protect federal employees from financial penalties they may experience while working without pay or furloughed during a government shutdown.
If passed, The Federal Worker Credit Protection Act of 2026 (S 4478) would prevent harm to a federal employee’s credit ratings because of missed or delayed payments.
Specifically, the bill would:
- Prohibit consumer reporting agencies from reporting adverse information on the credit report of federal workers during a government shutdown and for 30 days after the end of a shutdown as workers’ pay is restored;
- Require the Office of Management and Budget (OMB) to notify consumer reporting agencies when federal agencies enter and exit shutdown status;
- Allow federal workers to correct adverse information already on their credit report.
Senators Mark Kelly (D-AZ), Angela Alsobrooks (D-MD), Ruben Gallego (D-AZ), Tim Kaine (D-VA), Chris Van Hollen (D-MD), and Mark Warner (D-VA) introduced the legislation want to help ensure federal employees are not financially penalized for circumstances beyond their control.
“Federal workers shouldn’t be punished by a government shutdown that isn’t their fault,” said Kelly. “Earlier this month, I met with Phoenix TSA officers working without pay. They shared how the financial strain they were dealing with — including missed payments — hurt their credit scores. That kind of damage can follow you for years. I’m taking action to make sure the people who keep our country running aren’t hurt by Washington’s dysfunction.”
“It’s just common sense that we pass legislation protecting civil servants from evictions, foreclosure, loan defaults, and credit damage during these disastrous shutdowns,” said Alsobrooks.
Everett Kelley, National President, American Federation of Government Employees, (AFGE) said the legislation is “a much-needed bill to temporarily protect the credit ratings of federal employees during government shutdowns. The sad reality is that all-too-frequent agency funding lapses can permanently harm federal workers, long after the government eventually reopens.”
The legislation was proposed after the recent 76- day partial government shutdown in which thousands of federal employees in the Department of Homeland Security (DHS) missed paychecks.
“We have been showing up to work since November without a paycheck, then only partial checks and it has taken a real toll,” said Pascual Contreras, a TSA officer at Phoenix Sky Harbor International Airport. “I am three months behind on rent, and my credit score has dropped by more than 200 points. That has put our plans to buy a home out of reach. It’s not fair that something out of our control can impact our financial future like this. I’m grateful to Senator Kelly for listening and working on a solution.”
The full text of the bill can be downloaded here.