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Personnel reforms in the Defense and Homeland Security departments will happen, and managers and employees need to learn from reforms already in place at some agencies, Sen. George D. Voinovich, R-Ohio told a Senate subcommittee hearing Tuesday.

"We're going forward with this, there's no question about it," said Voinovich, chairman of the Senate Homeland Security and Governmental Affairs Subcommittee on Oversight of Government Management, the Federal Workforce and the District of Columbia. DHS plans to start the pay-for-performance portion of its system in January 2008; Defense plans to finalize regulations this fall for a similar system. The Bush administration is proposing to extend parts of these reforms to all agencies, although no bill has been introduced in Congress yet.

The committee heard testimony from administrators of existing alternative personnel systems, including the National Institute of Standards and Technology, the Federal Deposit Insurance Corporation and the Government Accountability Office, as well as opponents of the reforms.

NIST began its alternative system in 1987. According to Deputy Director Hratch Semerijian, it includes a pay-for-performance system that uses performance evaluations to grant locality increases, performance pay increases and performance bonuses. The system also includes direct hire authority, flexible entry salaries and recruiting allowances.

Semerijian said that since implementing the system almost 20 years ago, "NIST is more competitive for talent and retained more top performers," including two Nobel Prize winners. The NIST system covers about 2,500 employees who are scientific and engineering professionals and technicians as well as administrative professionals and support staff.

Two union presidents at the hearing--American Federation of Government Employees president John Gage and National Treasury Employees Union president Colleen Kelley-- took exception to the notion of modeling governmentwide reform on NIST's specialized workforce.

Gage called personnel reforms like those at NIST "a disaster for law enforcement" and "other jobs where there's such a team element."

Other agencies in the Commerce Department, of which NIST is a part, are being placed in alternative demonstration projects on the heels of what the department views as success at NIST.

Commerce Deputy Assistant Secretary for Administration Jeffery Nulf testified that since 1998, 4,200 additional employees in agency subcomponents have been placed in demonstration projects, primarily in the National Oceanic and Atmospheric Administration, with workers in positions much like those at NIST. Nulf said the agency will add employees in October that are represented by two unions, the Washington Printing and Graphic Communications Union and AFGE, upon their request.

The FDIC, an independent agency not funded by Congress, used its personnel flexibilities to dramatically shrink and grow its workforce as needed, Division of Administration Director Arleas Upton Kea testified. She said that in the early 1980s, FDIC had about 4,000 employees; due to massive bank failures in the early 1990s, its workforce grew to 23,000. As the crisis faded, the agency dwindled down to 5,000 employees.

Kea said that, in order to shrink its workforce, FDIC used one-year temporary appointments, flexible buyout authority and retraining to move employees into other jobs that were open.

Expansion of the systems at FDIC and NIST to the whole of government, however, is a much larger undertaking. The Office of Personnel Management would likely play a key role in administering these personnel reforms, which gave pause to some of the attendees, including David Walker, comptroller general of GAO.

Walker said he has "a serious concern that OPM does not have adequate capacity, both with the number [of employees] and with the skills and knowledge...I think that's a real issue."

Both Gage and Kelley stressed that collective bargaining needs to be part of any pay system, including those that are performance-based. Sections of DHS' personnel reforms that dealt with labor negotiations were ruled illegal in August, because they failed to provide adequate collective bargaining for employees.

Gage cited a demonstration project in the Defense Department at Fort Monmouth, N.J., which he said "works relatively well." He said that's because it has a "strong, fair, and reliable system of checks and balances achieved and maintained through collective bargaining."

COMMENTS

• I’ve worked for both NIST and NOAA under the demonstration projects for more than 10 years. For the past five years I’ve been in the GS system with the Defense Department. So which system is better? I like the pay for performance system and would return to it in a flash. However, it’s a big mistake to think this system will magically fix problems at the Defense Department, Homeland Security Department, etc. Personnel systems are just tools and only as good as the managers who use them. The Defense Department’s biggest problem is that it is moribund by incompetent and unethical management. I know a GS-14 Chief Information Officer who can’t even do basic tasks on a computer. He got the job simply because he plays golf with upper management. There are loads of GS-12s and GS-13s with diploma mill degrees that are functionally illiterate ( no joke! ). I would bet 80% of the people in the Defense Department get jobs based on cronyism and fake qualifications. And talk about grade inflation! A GS-12 at Defense Department is equal to a GS-9 in most other agencies. It’s absolutely shameful when there are so many highly qualified and motivated Americans to fill these positions. Switching to a new personnel system is not going to address these underlying problems. It could even make them worse! The real answer is to place highly ethical and talented people at the top to attract, hire, and retain a quality workforce. A major purge is needed. Weed out all these people with fake degrees and qualifications. Enforce merit principles in hiring with an iron fist. Zero tolerance for managers and human resources officers who abuse the system. Start at the top and work on down. GovExec.com reader Posted October 6, 2005 8:51 AM
• RobertM, Just to point out the obvious - we DO have pay for performance with our legislators; whether we're talking local, state or national. It's called the election process and term lengths. Many (if not most) states have a method to do a recall an incompetent (i.e. your suggestion to shorten the term) politician. The fact of the matter is that the way most of us define "success" for aq politician is by how much pork they bring back to the state that elected them. A few years ago, there was a fairly extensive grass-roots movement to "throw the bums out!" Do you remember the results? I don't remember any of the bums losing their seats. Apparently we want the other guys to throw their bums out but we all want our pork-laden bums to remain in place. But just let one do some serious cost-reduction politics and he/she's out on his/her keester in a heartbeat. Skeptical Posted October 3, 2005 8:45 AM
• Pay-for-performance is a great idea and our congressional representatives should take the lead and make their positions pay-for-performance. The starting wage for congressional representatives should be fifty thousand dollars and the voters will decide every year just how much of a raise and how many bonuses they will receive. We could even go as far as to allow the voters to decide to shorten representatives’ terms when they perform poorly. Of course Senator Voinovich might not fare too well. He seems more interested in pleasing the party leaders than his constituents. He won't even stand up against the corruption in the government that has hurt so many injured federal workers in his district. Robert M. Posted September 28, 2005 7:10 PM