Spangdahlem Air Base’s 52nd Services Squadron stripped post allowances and other benefits from two employees earlier this week in an attempt to offset at least part of an abrupt, dramatic and unplanned-for increase in personnel costs.

The employees were among 450 Air Force nonappropriated fund employees in Europe who recently started receiving post allowance, a cost-of-living allowance given to qualifying overseas Americans. A Defense Department ruling in March directed the Air Force and a handful of other NAF employers to begin paying the allowances to qualifying employees immediately, following more than a dozen years in which the employers were in violation of DOD policy.

U.S. Air Forces in Europe expects the allowance will cost roughly $4 million a year.

The two employees received "Business Based Actions" letters on June 12 that said their jobs were being reclassified from regular positions, in which they were guaranteed 40 hours per week, to flexible positions, where they aren’t guaranteed any hours. They were also told their pay would be cut from $9.24 an hour to $8.39 an hour.

The squadron is likely to save between $15,000 and $20,000 a year in post allowance payments to both men. The reclassification also strips the employees of health and dental insurance benefits, annual leave and other perks.

"This was a business-based action to ensure our ability to provide quality services to our airmen and their families," Air Force Senior Master Sgt. Cheryl Toner, a base spokeswoman, said by phone Thursday.

Both employees, retirees from the U.S. military who settled in Germany, work in the same small nonappropriated-fund business activity, which Toner said she wouldn’t name in order to protect their privacy. "This activity in question had been facing a severe financial challenge and this was necessary to ensure the viability of that activity," Toner said.

She said she couldn’t say whether or not other business organizations within the squadron were also losing money, but the squadron is looking at all its businesses. "It’s not just those two guys that were being looked at."

The two employees were getting by before they got post allowance, "but to cut their pay rates and cut their hours, you know, that’s completely decreasing what they already had, and then that takes away their insurance and their leave and everything else," said a Spangdahlem employee who is familiar with the circumstances and declined to be named, citing fear of retribution.

The employee disputes that there was a serious effort to find ways to cut spending in other areas. "They just said, ‘OK they’re losing money, that’s an easy one that we don’t have to pay for post allowance on.’ "

Neither of the two affected employees were identified.

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