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Federal Diary: Equal Raises for Defense Employees in 2010

The Pentagon's decision provides yet another measure of the troubled state of pay-for-performance, or the National Security Personnel System.
The Pentagon's decision provides yet another measure of the troubled state of pay-for-performance, or the National Security Personnel System. (By James M. Thresher For The Washington Post)

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By Steve Vogel
Tuesday, September 29, 2009

Pay increases will be the same in 2010 for almost all Defense Department employees, regardless of whether they are covered by the controversial pay-for-performance or General Schedule system, the Pentagon has decided.

Defense Secretary Robert M. Gates's conclusion provides yet another measure of the troubled state of pay-for-performance, the National Security Personnel System, which was created by the Bush administration to replace the GS system. It follows a report this summer from the Defense Business Board, a task force set up to review the system, which found that the NSPS is in need of a full-scale "reconstruction." That finding is being reviewed by Deputy Defense Secretary William J. Lynn and Office of Personnel Management Director John Berry.

Gates's decision, the NSPS program office said last week, was informed by the task force's report and a broader departmental review of NSPS. "The Department leadership decided this was the most prudent course of action," the office said.

Last year, Gates exercised his discretion to allocate 40 percent of the base GS salary increase to NSPS pay pools for performance-based salary increases. This year, according to the NSPS office, those pay pools will receive none of the GS increase. Instead, 100 percent of the GS increase will be paid as an across-the-board raise to employees with ratings of record of "2" or higher.

"They were forced to do something like this in the face of the complete failure of the pay system," Brian DeWyngaert, chief of staff for the American Federation of Government Employees, said Monday. "Employees hate it so much, they had to quell the criticism."

The NSPS office said pay pools will continue to have money available for performance-based salary increases and bonuses, preserving the link between pay and performance under the NSPS. But the amount available was not specified.

The amount of the GS base salary increase will not be known until the president signs an executive order implementing the 2010 pay adjustment.

The fundamental problem with the NSPS, critics say, is that employees do not trust it to make fair decisions about their compensation. Employees, unions, members of Congress and the Government Accountability Office have complained that the system lacks transparency.

Employees with ratings of record of 2 or higher will receive local market supplement adjustments equivalent to the GS locality pay adjustments specified for their work locations. NSPS employees who have not yet been rated will also receive the full GS base salary increase and locality pay adjustments.

"Of course, it's good news for employees," DeWyngaert said.

The small number of employees who have a rating of record of 1, or unacceptable, would not receive a pay increase, nor are they eligible for local-market-supplement adjustments, according to the program office.

About 205,000 employees are covered by the NSPS. In March, the Obama administration announced that it would not move any more civilian employees from the GS to the new system, until a review of NSPS was complete.

The resulting report from the Defense Business Board in August reported that the system is "complex," "confusing," "lacks transparency" and has "limited promotion opportunities," but the task force stopped short of recommending that it be killed.

Berry told Federal Diary columnist Joe Davidson last month that NSPS, the signature federal personnel effort by the Bush White House, has become "strategically flawed . . . to the point where it cannot succeed, because it does not have the buy-in of half of the equation, which is the workers."

DeWyngaert said last week's decision amounts to "a stop-gap effort by DOD" and "flows from the fact that the Department of Defense finds itself in a quagmire." Left unresolved is the question of whether the Obama administration will try to reconstruct the system, as recommended by the Defense Business Board, or scrap it altogether.

Staff researcher Eric Yoder contributed to this column. Joe Davidson is away. He will resume writing this column when he returns. Contact Federal Diary at federaldiary@washpost.com.


© 2009 The Washington Post Company

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