Are AAFES Employees Considered Federal Employees?

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The Army and Air Force Exchange Service (AAFES) is an organization that provides retail stores, gas stations, restaurants, and other services to U.S. Army and Air Force installations worldwide. But are AAFES employees actually considered federal employees? Let’s take a closer look.

A Brief Overview of AAFES

  • AAFES is run by the Department of Defense (DoD), making it an official entity of the U.S. federal government.
  • It operates over 3,100 facilities in more than 30 countries and U.S. territories.
  • AAFES stores offer tax-free shopping privileges to active duty military, veterans, and their families.
  • The first AAFES stores opened in 1895 near Army outposts in the western U.S.
  • Today, AAFES employs over 37,000 personnel, both military and civilian.

Federal Employee Status of AAFES Workers

  • Yes, AAFES employees are considered federal employees since AAFES is managed by the DoD.
  • However, AAFES workers are not on the General Schedule (GS) pay scale like most civilian federal employees.
  • Instead, AAFES uses its own pay bands and job classifications for its employees.
  • Salaries and benefits for AAFES employees are governed by DoD regulations and directives.
  • AAFES employees are eligible for federal employee benefits like health insurance, retirement plans, and paid leave accruals.
  • They enjoy legal protections and rights like other federal workers under Title 5 U.S. Code.

Key Differences From Regular Federal Employees

While AAFES employees are federal workers, there are some notable ways they differ from regular GS-scale staff:

  • Pay Scale – AAFES does not use the GS grades and steps that most federal agencies use. Compensation is based on internal AAFES pay bands instead.
  • Job Titles – AAFES has its own job titles and descriptions that don’t match federal classifications. For example, sales associates, food service workers, stockers, etc.
  • Hiring and Discipline – AAFES has more autonomy in hiring, firing, and discipline compared to most federal agencies.
  • Probationary Period – Newly hired AAFES workers go through a 1 year probation instead of 1-2 years for most federal staff.
  • Union Representation – Most AAFES employees are not represented by federal employee unions.

Benefits for AAFES Employees

AAFES employees enjoy many of the same benefits as other federal workers:

  • Health Insurance – Options include GEHA, Blue Cross Blue Shield, Aetna, and others. The government contributes to premiums.
  • Retirement Savings – Employees are automatically enrolled in the Thrift Savings Plan (TSP), with matching contributions.
  • Paid Leave – Employees earn annual and sick leave. Full-time staff get 10 holidays and 13-26 vacation days per year.
  • Military Store Discounts – AAFES employees get discount shopping privileges at military facilities.
  • Life Insurance – Low-cost term life insurance is available through FEGLI.
  • Other Benefits – May include disability insurance, long-term care insurance, and flexible spending accounts.


In summary, AAFES employees definitely meet the criteria for federal employee status. They are ultimately employed by the Department of Defense, which makes them part of the executive branch of the U.S. government. However, AAFES workers operate under different personnel and pay systems compared to most civilian federal agencies. But they still enjoy many of the same benefits and legal protections as other government staff. So while there are some technical differences, there is no doubt that AAFES employees serve as federal workers while supporting military members and their families.

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