| Comment Number: | OL-10501512 |
| Received: | 2/25/2005 2:54:35 PM |
| 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:
General comments: The Department of Defense's Web site said the new system was needed to better support the department's "critical national security mission. I don’t believe that changing the pay system will have anything to do with increasing national security. It also seems that the underlying premise, to the portion of the NSPS associated with pay for performance, is flawed. The argument for dropping the General Schedule pay system in favor of a new “pay banding” system is that “high performers” and” low performers” are paid alike, and that employee’s salaries are based on longevity rather than performance. My experience after 36 years of federal service has been that low performers stay in the same GS grade, and only move up in steps, based on years of “not unacceptable performance.” High performers move up more quickly in steps (quality step increases) or get promoted to higher GS grades based on “superior” performance. In both cases, the performance rating is determined by the employee’s supervisor. Under the proposed NSPS plan, those same supervisors will still evaluate their employee’s performance each year, and all those employees who are rated at least “not unacceptable” will still be eligible for a pay raise or bonus; except now the “lower performer” won’t have to wait two or three years for a step increase, they can receive one every year. This seems contrary to motivating better performance. Under the proposed NSPS plan, those employees who are rated “unacceptable” will not be eligible for a pay increase or bonus. Under the GS pay system, those employees who are rated “unacceptable” are denied a step increase that year (assuming they were scheduled to receive one). This represents no change for low performers. On the other hand, high performers stand to be penalized under the new NSPS plan. Under the GS pay system a high performer knows that demonstrated outstanding performance will gain them a step increase (assuming one is scheduled); under the NSPS plan it will possibly make them eligible for some form of pay compensation. This does not seem like a sound approach to motivating great performance. Under the GS pay system, there are two basic components to establishing a federal employee’s annual monetary compensation. The first is the yearly general pay increase/locality pay adjustment implemented in January. This adjustment, recognized by the President and Congress, is based on the reality that the cost of living (gas for automobiles, food, medical expenses, clothing, school tuition, etc.) increases each year and is necessary to keep federal employment competitive with, and on a comparable basis to, private sector employment in the local community. The second component is possible promotion, step increase or performance bonus paid as a reward for good on-the-job performance. The proposed NSPS plan would eliminate the first component that recognizes that even federal employees are entitled to a reasonable standard of living, adjusted yearly for inflationary factors outside their control. That’s a guaranteed way to kill motivation and morale! However, the most detrimental aspect (to both morale and performance) of the new NSPS plan is the fact that the employee’s salary stands to be restricted (or at least in a state of limbo) without any sound justification. Each year a pay pool panel gets to decide whether or not an employee is entitled to a raise in pay, a cash bonus, a combination of both, or nothing at all. This makes it extremely difficult for an employee to do any financial planning (with regard to home buying, major purchases, saving for college expenses, etc.) since they will not know from year to year what amount of compensation to expect. Maybe even more importantly, it potentially jeopardizes the employees’ retirement pension since his or her “high three” salary can be frozen indefinitely by simply granting only “cash bonuses” rather than pay increases! Interestingly, the NSPS homepage has an answer to a question about whether or not NSPS would affect retirement, and the answer was … “no, rules affecting retirement benefits or eligibility fall outside the scope of the NSPS law.” That is a very deceptive answer, in that the rules for computation are not affected, but the amount to be used in computing the retirement pension can most definitely affected! Under the new system, the ability to hire an employee at any pay rate in any pay band may attract some good candidates, but it certainly won’t entice them to stay with the federal government. Overall, it appears that the proposed NSPS plan is really geared more toward meeting the stated “guiding principles and key performance parameters” of cost effectiveness and being fiscally sound; and less toward respecting the individual, valuing talent and compensating high performing employees based on performance and contribution to mission. If DoD really seeks flexibility in hiring and assigning workers for security reasons, then make those types of changes to the personnel system and leave the GS pay schedule alone. Specific comments: Subpart/section 9901.313. DoD should not be allowed to allocate funding for compensation “to the maximum extent practicable,” since that permits DoD to determine that it simply wasn’t “practicable” to allocate all of the money intended for employee compensation. It is similar to the language used by every President since 1978 that has avoided granting federal employees the full catch-up raise they were supposed to be entitled to because of “nation emergency or economic conditions.” Subpart/section 9901.322(d). This appears to be just one way of compressing employee’s salaries. The minimum rate can go up by some amount (to attract new employees?), but the maximum rate can remain the same indefinitely, thereby harming good employees who simply happen to be at the high end of the pay band. Subpart/section 9901.322(a). This subpart appears to be in conflict with subpart/section 9901.343(d) (4). 322(a) implies that “all” employees with a rating above “unacceptable” will receive a percentage increase in “basic pay;” however, 343(d) (4) states that an increase in basic pay may not cause the employee’s rate of basic pay to exceed the maximum rate of the pay band. If the later is true, then this certainly appears to be discriminatory against some people. Subpart/section 9901.333(a). Why should DoD need to establish it’s own “market supplements” (for application just to DoD) when there are “locality adjustments” established by another government entity for application to the rest of the government? This seems wasteful and unnecessary. Subpart/section 9901.333(b). Allowing DoD to establish the effective date for the market supplements permits the possibility for a very restricted period of effectivity. This could be harmful to current employees, while making the government less competitive with local private sector employers. Subpart/section 9901.334(a). This subpart appears to be in conflict with subpart/section 9901.343(d) (4). 334(a) implies that “all” employees with a rating above “unacceptable” will receive a percentage increase in “basic pay;” however, 343(d) (4) states that an increase in basic pay may not cause the employee’s rate of basic pay to exceed the maximum rate of the pay band. If the later is true, then this certainly appears to be discriminatory against some people. Subpart/section 9901.342(b) (2). This subpart leaves open the possibility that employees may never receive a pay increase, just a yearly bonus. That possibility would have a very significant impact on the employee’s future retirement pension since the “high three year’s salary” would be drastically lower for use in the retirement formula computation. The application of using bonuses, in lieu of actual pay increases in salary, would most likely have a detrimental affect on good performance, and on retaining good employees! Subpart/section 9901.342(d) (3). This subpart is particularly troublesome. Not only are maximum pay band amounts set arbitrarily, but under this section DoD can set a “control point” that would make it almost impossible for an employee to even reach that maximum amount. Employees thinking they had a “wide” pay band in which they could rise to the top, based on demonstrated performance, could find that the “wide” band was in fact very “narrow.” If this “control point” concept remains in the law, then employees should be notified at the start of what the control point is in each of the bands, so they can be aware of the potential likelihood that they may never be able to achieve the advertised “maximum” amount of their pay band. Subpart/section 9901.343(d) (4). This subpart allows for the possibility that an outstanding employee may never receive a pay increase for their performance. This is not only counter-productive to attempting to incentivize good performance, but it is blatantly unfair to employees when it comes to computing retirement pensions.