Pay caps may be in store for thousands of former NSPS workers

As many as 40,000 feds transitioning from National Security Personnel System could face long-term pay caps with their switch to the General Schedule, according to a new analysis of the ongoing conversion by the Federal Managers Association.

In a letter dated May 14, FMA President Patricia Niehaus told the leaders of the House and Senate Armed Services committees that rules governing such conversions will hurt many employees currently transitioning out of DOD’s pay-for-performance system.

Related stories

Transition office established to hasten end of pay for performance

Survey reveals discontent with pay-for-performance plans

Pay for performance: A modester proposal

Pay for performance haunted by NSPS failure

Performance management in action

Research questions link between pay and performance

4 approaches to pay for performance

Although Congress mandated that no NSPS-covered employee would see a pay cut with the conversion, FMA said many workers are caught in a jam because they are being paid more now under NSPS than their GS level would allow. Under pay retention rules, the group said, the raises of these employees will be limited to half of the regular GS raises until their GS classifications catch up to their wages.

“Many of these dedicated employees have crunched the numbers and determined that the General Schedule will not ‘catch up’ with them by the time they retire over the next decade,” Niehaus wrote. “This is unacceptable.”

The estimate of 40,000 workers is based on an FMA survey of its own members that showed anywhere from 20 to 25 percent would be hit by the pay gap. Pay retention does not only affect the current pay received by these employees, but also could negatively affect workers’ high-3 average salary, which is used to calculate retirement benefits, Niehaus wrote.

Niehaus asked that committee members encourage DOD transition officials to use existing conversion flexibilities to make sure that NSPS employees are not hurt by the switch.

“Employees who continuously displayed above-average performance under NSPS would be affected greatest, which sends the message that performance is not recognized in the federal workplace,” Niehaus wrote. “No employee should lose current, future or retirement pay as a result of a pay cap when converting back to the General Schedule.”