GovernmentExecutive.com

The next president should tread carefully when it comes to revamping the federal government's pay scale, said a panel of senior managers, union officials and industry representatives last week during an event sponsored by the Partnership for Public Service.

"I think the General Schedule system is an anachronism," said Scott Cameron, former chief human capital officer at the Interior Department and current director of enterprise management solutions in the global public sector practice at the international accounting and tax firm Grant Thornton. But Cameron recommended a gradual migration away from the GS system to avoid "knock-down drag out" battles with Capitol Hill and the unions: "I would not advise the new administration to launch a frontal assault on it, because I don't think it's worth the expenditure of political capital."

Cameron joined 17 workforce management professionals to discuss ideas and develop recommendations for the next commander-in-chief and Congress on issues including the General Schedule pay scale, contracting, performance-based pay and training for federal managers.

Reforming the government's pay system dominated most of the March 12 discussion. Critics argued that the General Schedule rewards longevity rather than merit, and hinders the recruitment of highly skilled employees, while supporters said it promotes pay equality. Chris Mihm, managing director of strategic issues at the Government Accountability Office and event moderator, asked panelists if the GS system was dead. "I don't even think it's sick," said Jacque Simon, public policy director of the American Federation of Government Employees. "It has done a marvelous job at eliminating pay discrimination based on race, gender and age."

Other pay-for-performance critics cited benefits such as recruitment and retention bonuses and student loan repayment as flexibilities allowed under the federal pay scale that provide important incentives to retain high-caliber employees.

"Part of the concern in my view about moving to another system, is about trust" between unions and government managers applying pay-for-performance metrics, said Matt Crouch, president of the Presidential Management Alumni Group, an organization that champions private sector-style merit pay. While acknowledging that unfair pay decisions do occur in the private sector, Crouch added that industry has "an overall metric of profitability." In other words, he said, "If I don't like you, but I need you to make my profit, I'm going to think twice before I short your pay. We don't have that measure in the government." Some agencies, including the Defense Department, have opted out of the GS system in favor of a pay-for-performance scale.

Lynn Jennings, vice president for strategic initiatives at the Council for Excellence in Government, said great leadership is the key to a strong workforce rather than any particular pay structure. "You can have the General Schedule system, pay-for-performance, a system in between, but unless you have good leaders implementing [it] and your employees think it's fair, you'll be in the same position," she said.

In addition to pay reform, panelists also discussed the costs and benefits of government contracting. "The value of contractors, of course, is that you can expand very rapidly and then when you're done with them you can contract very rapidly," said Ron Sanders, chief human capital officer at the National Intelligence Directorate. "Use them as a buffer between you and the rest of the outside world to protect that core [workforce]."

Crouch complained about the current costs associated with government contractors. Recent union victories in Congress, such as preventing health benefits from being counted against federal employees in competitions, and the right of employees to recompete contracts before they are opened to public competition, have leveled the playing field. "We've driven up the transaction cost so incredibly high," he said. "That what is required for a company to successfully compete for a government contract, deliver the results that the government wants, oh, and not charge billions of dollars to do it, has become harder and harder."

Cameron agreed. "It's wonderful to have competition. But competition can end up being more expensive," he said.

COMMENTS

• “So, you have two people, one who shows up, does nothing and another who comes in busts tail and they get the same pay??? ” Those busting tails should be making more compensation, particularly under the current GS system. Those with some experience have said all along that one of the major down falls of the NSPS implementation is that the same managers will still be managing. If those managers are too busy (I will give them some slack) to properly manager their poor workers, they are probably too busy to manage the good workers; who while need less supervision DO need reassurance and, if deserved, compensation. Those 15 page NSPS evaluations are NOT going to write themselves. Now they’ll also have to go to the pay panel pools and defend their evaluations. But under the current GS system, it’s MUCH simpler to submit an annual bonus award, or a step-increase reward, or even an impact financial award. So which system supports rewarding good performance better and easier? If you’re going to knock the current GS system, you’ll have to find another reason than the compensation plan. There ARE means to address good performance. But if you have the same overworked supervisors… adding an annual 15 page report and a political battle against quotas isn’t going to help. Tip off Posted March 27, 2008 4:13 PM
• In 1969-1970 I took a class that explained that what you technically know or your ability to do the job was about 6th item down as to why an individual would be selected for a group project. If human nature to prefer good old boys, cronyism, nepotism and polyanna's was so well known in the early 70s, why have they managed to institute a way to ensure the technically qualified and able bodied have less and less chance to get paid/promoted for their actual work? GS system kept the inevitable personal preferences at bay better than any NSPS system could hope to. We've mistaken a certain cachet or charisma for real ability for too long. Pay for popularity is not the answer. I'll be leaving government shortly for greener pastures, my 30 year experience now has the unknowing leading the ignorant (not stupid) and scaring the bejezus out of anyone that understands how much has been misunderstood and forgotten. Ralph Posted March 27, 2008 2:58 PM
• So, you have two people, one who shows up, does nothing and another who comes in busts tail and they get the same pay??? Oh, and the former is usually an "old timer" and the latter a "young buck". I wonder where the friction is coming from!!! LEO Posted March 27, 2008 10:29 AM