DOD workforce plan criticized

A Defense Department proposal to overhaul how 746,000 of its civilian workers are hired, paid and managed is moving through Congress despite criticism from lawmakers last week over some aspects of the plan.

As part of a legislative package sent to Capitol Hill April 11, DOD has proposed creating a National Security Personnel System (NSPS) that would link pay to performance, speed hiring and abolish the General Schedule pay system. NSPS also would institute other changes such as the ability to bargain with employee unions at the national rather than local level.

DOD's civilian personnel management system needs to change because it "stunts opportunity, minimizes rewards and provides little incentive for risk-taking," said David Chu, undersecretary of Defense for personnel and readiness, before a House subcommittee last week. NSPS' guiding principle, Chu said, is national security. It is essential to the efforts to "transform the way we fight and manage."

However, many members of the House Government Reform Committee's Civil Service and Agency Organization Subcommittee expressed concern about the proposal.

"Given the Bush administration's track record on civil service issues, there's no reason to think that DOD's new system will be a fair one," Rep. Henry Waxman (D-Calif.) said at the subcommittee hearing. "There's also no reason to think the new personnel system will be a good one."

Waxman said a recent General Accounting Office report called DOD's civilian strategic plan "completely lacking. This hardly inspires confidence for what DOD might do if we give them this authority." However, Chu said DOD has 20 years of practice with workforce flexibilities via its demonstration projects.

The bill needs more careful consideration, Waxman and other lawmakers said, and should not be rushed through Congress. However, members of the House Government Reform Committee were expected to mark up the legislation May 1, and House Armed Services Committee members will this week consider the proposal, which will be part of the Defense authorization bill.

In testimony, Comptroller General David Walker said many of the basic principles underlying DOD's proposal have merit, but moving too quickly "can significantly raise the risk of doing it wrong." Improving performance management systems so they support pay-for-performance and other systems must happen first.

Rep. Jo Ann Davis (R-Va.), the subcommittee's chairwoman, asked whether Defense Secretary Donald Rumsfeld would consider separating the proposal from the Defense authorization bill to give Congress more time to consider it. Chu said that was unlikely to happen.

Davis questioned a provision that would allow DOD to overrule the Office of Personnel Management on workforce issues in matters deemed national security. "What is essential to national security?" she asked, saying the term was too broad. She also questioned whether OPM would have less of a role.

"There is no intention to cut OPM out of its strategic oversight role," Dan Blair, OPM's deputy director, said at the hearing. It might make OPM's role harder, "but that's no reason not to do it." Chu assured Davis that DOD and OPM are partners and that DOD operates under congressional oversight.

Another area of contention is that employee labor unions were not involved in designing the NSPS proposal. Bobby Harnage Sr., national president of the American Federation of Government Employees, asked the subcommittee to reject the legislation. Chu said he believes that "we do know what our employees want."

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Moving ahead

The Defense Department is defending its proposal to create a new personnel system for its civilian workers — a move that is essential to the department's transformation plans, said David Chu, undersecretary of Defense for personnel and readiness. DOD is asking for broad authorities so that it has the flexibility to "make changes over time," he said. For instance, in 10 years, the department will likely discover pay banding can be done a different way.

Regardless of where the legislative proposal goes, DOD plans to expand its existing demonstration projects to potentially include 130,000 people. The projects cover some employees who work in acquisition and defense laboratories and testing centers and may include the intelligence community. The projects test ways to hire, pay and manage employees.