Controversial Pay-for-Performance Program Put on Hold

By Joe Davidson
Tuesday, March 17, 2009

Step by step, federal employees are feeling the impact of the Obama administration on their lives.

The latest step came yesterday when the Pentagon and Office of Personnel Management announced that, pending a review, no more civilian employees would be moved from the long-established General Schedule -- aka GS -- method of classifying workers to the much-maligned National Security Personnel System.

The review could turn into an NSPS obituary.

"This administration is committed to operating fair, transparent and effective personnel systems, and we are undertaking this review to assess whether NSPS meets these objectives," said Deputy Secretary of Defense William Lynn, who ordered it.

The verdict of federal employee unions on those questions was delivered long ago.

"This policy was a product of the ideologues of the previous administration aimed at suppressing civilian pay and eliminating collective bargaining rights," said John Gage, president of the American Federation of Government Employees. He said he met with Lynn last week and told him NSPS is fundamentally flawed.

"It is about time we ended it," Gage said.

NSPS marked the Bush administration's most forceful attempt to eliminate the GS system and replace it with a pay-for-performance structure. But many employees have never trusted it to fairly evaluate or compensate them.

Even statistics released last month, indicating that NSPS workers generally received higher raises than GS staffers, did nothing to quell that opposition.

The opposition was bolstered with a Feb. 13 letter from House Armed Services Committee Chairman Ike Skelton (D-Mo.) and Rep. Solomon P. Ortiz (D-Tex.), chairman of the readiness subcommittee. They told Defense Secretary Robert M. Gates that the system has generated "widespread distrust and discontent within the ranks of the hundreds of thousands of dedicated DOD employees."

In September, the Government Accountability Office said "employees who had the most experience under NSPS showed a negative movement in their perceptions." In plain English, the more they saw of it, the less they liked it.

And in August, a Federal Times analysis of NSPS indicated that white workers generally received higher ratings, pay and bonuses than other employees.

Brad Bunn, NSPS executive officer, said there are no "parameters around the review" and its recommendations could range from minor modifications to its demise. Conversions to NSPS will be delayed during the review.

But given President Obama's campaign stand, it's a good bet that the system won't emerge from the review looking like a No. 1 pick in the NCAA basketball tournament.

The handwriting -- or maybe an NSPS death notice -- was on the wall when Obama was elected after saying he would "strongly consider a complete repeal" of NSPS or at least a broad reform of it.

Gregory Junemann, president of the International Federation of Professional and Technical Engineers, calls the review the "beginning of the end" of NSPS.

What would happen if the review rendered NSPS extinct remains to be seen. The 205,000 employees under it perhaps would go back to GS. "I'm not sure how we would handle that," Bunn said. Another 2,000 previously scheduled to be moved this spring will stay put.

There's no deadline for the review and no one has been chosen to head it, so Pentagon workers could be in limbo for months. "DOD and OPM leadership are engaged in discussions with key personnel in the administration to determine the overall framework, scope, and timeline of the review, including identifying an appropriate individual to lead the review," the statement said.

In other words, they are starting from scratch. The review certainly won't be helped by vacancies at the top of OPM and in the Pentagon's undersecretary for personnel and readiness office.

Union leaders welcome the review, but no matter what it finds, they are convinced that NSPS should go the way of the dodo bird, the Edsel and analog television.

"NSPS was never meant to be a good government personnel plan," said Richard N. Brown, president of the National Federation of Federal Employees. "It was designed to eliminate federal employee unions and suppress Defense workers' pay. Our mind is made up, NSPS needs to go."

The Government Accountability Office report can be found here:

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