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OPM's John Berry calls for new performance-review system for federal workers

Thursday, March 17, 2011; 12:37 AM

John Berry's call for a new federal performance-management system represents an evolution in the Obama administration's approach to the General Schedule and perhaps a reprieve for that classification system covering most federal workers.

In prepared remarks to the Interagency Resources Management Conference at Gallaudet University's Kellogg Conference Hotel on Wednesday, the Office of Personnel Management director spoke of a new system that would replace the current methods of performance reviews, which he said are "infrequent and rote."

The current review process "seems to take place in Garrison Keillor's Lake Wobegon, where everyone is above average," said Berry, who prefers to be called the government's "chief people person." "If that doesn't make our performance ratings suspect, I don't know what would."

Despite his criticism of the system, Berry made it clear that he is not talking about the end of the 60-year-old General Schedule, as he had previously. That change in thinking will please federal labor leaders who strongly defend the GS against attempts to replace it with "pay for performance" systems.

"We have flexibility under current law to encourage and reward excellence and eliminate mediocrity," Berry said in the speech. He offered "a basic blueprint for changing the way we manage personnel performance, and ultimately organizational performance, without changing the law or the pay system."

The push for a new system within the confines of current law is a change from the approach Berry advocated in the months after taking office two years ago.

In a November 2009 speech at his alma mater, the Maxwell School of public affairs at Syracuse University, Berry urged "comprehensive reform of our civil service system."

"We could limp along for a few more years in the current GS system," he said then, "or we can seize this moment to build something new."

The moment apparently passed. And not a moment too soon for union leaders.

The General Schedule "has both merit and market-based components," Colleen M. Kelley, president of the National Treasury Employees Union, said last week as she defended the GS before a House federal workforce subcommittee. "Within-grade and career-ladder promotions are subject to merit standards. There is limited ability for favoritism, discrimination or other nonmerit determinations to come into play. But there is also flexibility. Non-performers can be denied merit pay increases, and outstanding performers can be given many rewards, including quality step increases, annual leave, as well as retention and recruitment bonuses."

While defending the GS system, organized labor also is willing to make changes in it.

"I think we can . . . really make some very creative changes" to things such as within-grade pay raises, often called step increases, said John Gage, president of the American Federation of Government Employees. Gage said federal workers would not object to having those increases more directly linked to performance. Currently, the increases are largely based on longevity.

During a phone interview after his Gallaudet speech, Berry acknowledged that his thoughts had evolved after talking to "a lot of folks who are good thinkers on this topic" and after learning lessons from the Pentagon's crashed National Security Personnel System. Congress eliminated the NSPS after it failed to win the trust of employees.

Berry said the consensus among the "good thinkers" is that the performance equation can be solved separately, and should be solved first, before attempting to tackle the hornet's nest that is federal pay.

Any attempt to change the pay system now would force a confrontation with congressional Republicans who want further limits on the benefits and salaries of federal workers, whose pay already is frozen for two years. A report by the Congressional Budget Office last week offered several options for reducing personnel costs, including having employees pay more for health insurance, reducing the cost-of-living adjustment for retirees by changing the way it is calculated and cutting the across-the-board adjustment for federal civilian pay.

Berry's willingness to hold off on remaking civil service doesn't mean he's totally happy with the way the system works. In fact, he told the conference that "there is a need to consider reforms of the white-collar federal pay systems," including the Senior Executive Service.

Berry's blueprint includes setting performance standards that would be "detailed, objective, aligned to agency mission and goals, and [have] employee buy-in," and not just be "dictated from on high."

He outlined how good workers, top performers and slackers would be treated under a new system:

l The "well over 80 percent . . . who are doing a good job" would get three things - "a pat on the back, frequent feedback about how they might improve further and the training they need to get there. If we can give them something on the spot when warranted, like a gift card to take their family out to dinner, even better."

l Instead of cash, top performers would get "increased public recognition and greater opportunities to innovate."

l That "very small group of employees" who aren't performing would get "a clear, appropriate rating, and a consistent organizational commitment to get rid of them quickly, but fairly. Failing to remove poor performers disrespects and demotivates the entire team. And what's more, we don't have a position to waste."

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