Building a Better Government Personnel System

October 15, 2009
By Christopher J. Dorobek

The Obama administration deserves credit for looking to reconstruct National Security Personnel System.

If you think the health care debate has been controversial, just mention “pay-for-performance” in government circles. The government has made several attempts to develop a more modern pay system; a number of them have taken place in various agencies over the years. But there have been several big, high-profile pay-for-performance systems.

The most recent is the U.S. Defense Department’s controversial National Security Personnel System (NSPS). But there were others—the U.S. Department of Homeland Security’s MaxHR system, for example. And pay-for-performance has even been attempted at the Government Accountability Office (GAO), which made human capital one of its key initiatives. David Walker, the former comptroller general, made the “performance management” system a main part of the GAO pay plan. While it is unclear how successful that system has been, employees were concerned enough about it that they organized and unionizeda first for the GAO.

Given the mixed results for pay-for-performance in government so far, many people might ask whether any need exists to change the current federal government pay system. The federal government’s General Schedule (GS) pay system was enacted in 1949, replacing a similar system that was enacted in 1923. The goal of the system was then—and is now—to have equality among occupations. The phrase often used is “equal pay for equal work.” Without going into too many details, the GS system contains 15 grades, from the lowest, GS-1, to the highest, GS-15. Furthermore, each grade has 10 steps, and each step is a pay increase within that grade. Supporters of the system argue that, in fact, there are elements of pay-for-performance in the GS system. They claim, essentially, that the system isn’t broken, so it doesn’t need to be fixed.

And that system has worked well. But many would contend that, in fact, while the system may not be totally broken, it is outdated and is part of the very real sentiment in the nation that federal employees are less than the “best and the brightest.” Furthermore, many people, including managers and employees, will acknowledge that the GS system has problems. In the end, even with the performance aspects of the system, it ends up focusing on longevity, not on performance.

President Obama has made government performance a key part of his administration. He nominated Jeffrey Zients as the Office of Management and Budget’s new deputy director of management and chief performance officer. But the Obama administration, somewhat surprisingly, decided not to do away with the Defense Department’s NSPS altogether. Instead, the administration decided to take a step back and review the program, and the department asked a Defense Business Board task group to conduct a review. The meetings where that group heard complaints ended up being similar to this summer’s health care hearings—noisy.

The NSPS has few proponents. In the late summer, the NSPS task group issued its report ( In the end, the NSPS was handled poorly from the start. The George W. Bush administration forced the program on the department, and the department largely refused to talk to its employees, including the employee unions. Those efforts to firmly establish a system may end up setting it back.

That would be too bad. Dr. John Crum, deputy director of the Merit Systems Protection Board, has noted that few pay reform systems work on their first attempt. They are very complex systems. “It’s a change for the organization’s culture,” Crum says. But it also is critically important that pay be linked to agency missions—and to performance.

The big recommendation coming from the NSPS task group is right on: “The NSPS cannot be fixed; it needs to be reconstructed. A ‘fix’ could not address the depth of the systemic problems discovered,” the group’s final report says. “The Task Group does not recommend an abolishment of the NSPS because the performance management system that has been created is achieving alignment of employee goals with organizational goals.

“The reconstruction should include a true engagement of the work force in designing needed changes and implementation. Finally, the reconstruction should include desired outcomes and data collection to measure results,” the report says.

But the other recommendations, which have received much less attention, also are very relevant: The Defense Department needs to reestablish a commitment to partnership and collaborating with employees through their unions, and the department needs to establish its commitment to strategic management and investment in career civil servants.

One proposal missing from the Defense Business Board’s recommendation is a commitment to transparency. The board found that employees did not know the assessment criteria or even how the process works. Managers and employees deserve to know this information, something that has been lacking with the NSPS.

Reinventing a system is going to be difficult and complex. But the Obama administration has a unique opportunity to bring people together to devise a set of incremental steps that will better enable the Defense Department to make clear connections between the organization’s mission and how its people are rewarded. And the department can be a model for the rest of government.

These are unique and challenging times. The government needs a pay system that enables it to keep up with the rapid pace of change.

Christopher J. Dorobek is the anchor of Federal News Radio 1500 AM’s afternoon drive program.

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