The Monday morning mailbag overflows with e-mails from employees at the Federal Aviation Administration, most focusing on what the writers describe as an unfair pay practice at the agency.

The employees are at the top of the salary scale -- called a pay band -- for their job category. As a result, they receive their performance-based pay raises as a lump-sum payment rather than as a regular base pay increase. The lump sum does not count toward retirement and is often taxed at a higher rate than their regular pay, they said.

The employees estimate that 829 people are affected by this practice. But they have learned that more than 4,000 colleagues get their raise in base pay, primarily because they are covered by two negotiated union contracts that provide them with an exemption.

Marion C. Blakey, the FAA administrator, has received many of the same e-mails and replied with a "fellow employees" message. "I understand your concern about the impact of this on your retirement, thrift savings accounts, and other factors," Blakey wrote.

She promised "to evaluate the current situation" and "to keep you informed as our evaluation moves forward."

In her e-mail, Blakey said a labor market survey last year showed that the average pay of FAA employees was about 8 percent above private-sector rates for similar jobs. She also pointed out that FAA employees in the "core compensation" program have received pay raises averaging 10.85 percent over the last two years. Turnover remains low, at a 3.8 percent annual rate, she said.

The pay increases, coupled with low turnover, "do not make a case" for expanding the pay bands and raising the top salary rate to allow for base pay increases, Blakey concluded.

Ventris C. Gibson, the assistant administrator for human resources management, said the FAA used a compensation consultant to compare agency jobs with similar private-sector jobs. The job survey, which covered the aerospace and aviation industries, did not include air traffic controllers, who do not have comparable private-sector counterparts, she noted.

Pay bands were not adjusted last year, and any decision on where they should be set for this year will be made by December, she said. About 22,000 of the FAA's nearly 50,000 employees are covered by the core compensation system, which was implemented at the start of 1998.

Gibson said she is considering asking an outside expert to review the FAA's effort to provide pay linked to job performance, "just to make sure we are on target."

One of the FAA's unions, which represents headquarters employees, plans to look at the issue of employees bumping up against their pay band ceiling and how that affects pension benefits.

Jim Lenz, vice president of Local 3300 of the American Federation of State, County and Municipal Employees, said the union had written Blakey seeking information on the pay bands and how pay ceilings are set.


More than 1,000 federal managers and employees are headed to Phoenix for the 19th annual Federal Dispute Resolution Conference, which will feature more than 50 workshops on management, labor relations, alternative dispute resolution and other topics.

Scheduled speakers include Ronald P. Sanders, an associate director at the Office of Personnel Management; Neil McPhie, acting chairman of the Merit Systems Protection Board; Scott Bloch, head of the Office of Special Counsel, and Carlton Hadden, director of federal operations at the Equal Employment Opportunity Commission.

The conference will be Sunday through Aug. 19. For information, go to


Rick Haisch, a supervisory human resource specialist at the Justice Department, has retired after more than 34 years of federal service.

Gerard P. Yoest, the Coast Guard's director of international affairs and the foreign policy adviser to the Coast Guard commandant for the last 13 years, will retire Aug. 29 after 30 years of federal service.