Senate looks for lessons from alternative pay systems

Many agencies have been using alternatives to the General Schedule pay system for more than a decade, which prompted Sen. Susan Collins (R-Maine) to ask witnesses at a hearing today whether some of those could be expanded governmentwide.

Collins said lawmakers and agency managers should study how well alternative systems are working before changing. The Homeland Security and Defense departments and White House officials have crafted new personnel systems from scratch, which they want to implement. But employee unions are putting up considerable resistance to the changes.

Officials at the Federal Deposit Insurance Corp. and the National Institute of Standards and Technology testified that those agencies have replaced the General Schedule with pay increases based almost entirely on employee performance. After leaving the safety net of the General Schedule, FDIC employees initially filed more labor grievances to complain about their pay, said Arleas Upton Kea, director of the FDIC’s Administration Division.

Despite mixed reviews for the new pay system, most employees are adapting and are more productive, Kea said. The FDIC is on its fourth version of a pay-for-performance system that the agency continues to revise in response to employee feedback, she said.

Sen. George Voinovich (R-Ohio), chairman of a subcommittee of the Senate Homeland Security and Government Affairs Committee, said he was concerned whether the Office of Personnel Management could handle governmentwide training of managers that would be required to make performance-based pay systems work fairly. The subcommittee, which oversees the federal workforce, among other concerns, held the hearing.

Dan Blair, deputy director of OPM, said the agency could handle the additional responsibilities, if lawmakers provide adequate funding. “We’re subject to the vagaries of the appropriations process, and that’s not helpful to us,” he said.