My understanding is that with 1.3, if one is allied the rep will decay to friendly. While a hostile will decay upwards to unfriendly. This will happen unless you do specific missions for or against the faction. The PowerPlay stuff that earns merits, strangely, does not seem to have any effect on Faction rep or influence.
At least that is my understanding.
It seems like a... well... odd dynamic, but on the bright side if my rep with the Empire drops to Friendly, I may be able to do things to get it back up so that I can get Naval Ascension missions again.