The Pentagon has rolled the dice. The plan to convert the first wave of 65,000 Defense Department civil service employees to a new performance-based pay system has been issued, and Bush administration officials have lined up behind it.
"We're anxious for DOD to succeed," Linda M. Springer, director of the Office of Personnel Management, told reporters at an Oct. 26 briefing. "We know they will succeed."
She added: "Obviously, all of us through government are watching how this goes. There's a lot at stake."
It may take years, of course, before the Defense Department can declare that the National Security Personnel System is a success. (In its regulation, the Pentagon promises that NSPS "will be operational and demonstrate success prior to November 2009.")
Success, to some extent, hinges on the outcome of court fights -- the first way station for NSPS, which is supposed to give Defense a more flexible civil service system.
A coalition of unions, including the American Federation of Government Employees, led by John Gage, has said it will file a lawsuit mid-month to block the Pentagon's blueprint for reordering labor-management relations and giving management greater control over what issues come to the bargaining table.
The unions hope to prevail in part because a federal judge has blocked the start of new workplace rules at the Department of Homeland Security that would reduce the clout of unions there. The judge was particularly troubled that Homeland Security had set up a regulatory scheme that would allow the department to override or nullify contracts, saying that binding contracts are at the heart of collective bargaining rights.
The Pentagon's plan includes a similar provision that would allow the department to override union contracts. Articles in existing collective bargaining agreements "are unenforceable" if they are contrary to the NSPS regulation or Defense directives, known as "implementing issuances," according to the NSPS regulation.
Mary E. Lacey, the program executive for NSPS, said the Pentagon will limit the power to override collective bargaining agreements by giving it only to the most senior officials in the department, such as the secretary, deputy secretary and heads of the military services.
Lacey said that "every contract will have to be looked at, and there will be provisions in some of the existing contracts that will be nullified by this new regulation," which is scheduled to take effect before year's end.
Even though the judge in the Homeland Security case faulted the Bush administration for insisting that officials can abandon union contracts, Pentagon and OPM officials who worked on the Pentagon plan veer away from any comparisons by stressing that Defense operates under a different law from Homeland Security.
"As far as the sanctity of contracts, it is a federal environment and not the private sector, and federal contracts come under different precepts," George Nesterczuk, OPM's adviser on the NSPS, contended. "The fact that agencies have needs that sometimes permit them to pierce provisions of contracts is kind of an accepted practice in the federal sector."
Union lawyers contend that the Bush administration is reaching too far in its effort to revamp labor-management relations. In addition to the issue of voiding provisions in contracts, unions are concerned about Pentagon efforts to reduce the scope of bargaining by removing the requirement for negotiations over the impact of personnel deployments, assignment of work and use of technology. Unions also question the need for the department to create a new bureaucracy -- an internal labor board -- to handle disputes that currently go before an independent agency.
Gordon R. England, acting deputy defense secretary, said the Pentagon has tried to bridge differences with the unions. "I believe we have met the spirit and intent of what the Congress wanted us to do," England said. "This is a very balanced program."