| Comment Number: | OL-10500802 |
| Received: | 2/22/2005 7:57:53 AM |
| Subject: | Notice of Proposed Rulemaking, Request for Comment |
| Title: | National Security Personnel System |
| CFR Citation: | 5 CFR Chapter XCIX and Part 9901 |
| No Attachments |
Comments:
Pay and Pay Administration - Subpart C, pg 7560 “Performance Payout: The performance payout is composed of an increase to basic pay, a bonus, or a combination of these. A bonus is a one-time lump-sum payment that is not paid as basic pay. Subject to DoD guidelines, pay pool managers will have the discretion to determine the proportion of an employee’s total performance payout paid as an increase to basic pay or as a bonus.” Concerns – Since there are no published guidelines as far as I can tell, this “discretion” is wide open to potential abuse. Assuming performance that rates reward, and doesn’t push the salary beyond the rate range maximum, wouldn’t it be in accordance with the Guiding Principle of “Be competitive and cost effective” to hold down salary increases and emphasize one-time bonuses? You’ve never laid out which part of this principle is more important, competitive or cost effective. I can certainly imagine the pay pool managers receiving guidance to hold down salary increases for 1 year, 5 years or more. Then, while in any given year it may seem like you made an extra $5000 (a bonus), this emphasis on bonuses, does not improve your retirement money since it’s the basic pay rate that goes into retirement dollars. Imagine this occurring over the ten year period as an individual moves to retirement. Going back to the KPP of “credible and trusted”, you’re not credible and trusted on this issue. There is no doubt, whatsoever in my mind, this will be the path you take. You will opt for cheap. On the other hand, you could publish the guidelines, which may well say the performance payout must be at least 75% basic pay increase and 25% bonus (again assuming it doesn’t exceed the rate range maximum).