TOPICS
TOPICS
Study makes case for performance pay
The federal government must embrace the pay-for-performance concept and move closer to the private sector model of management and compensation, according to a study released this month by IBM's Center for The Business of Government.
"In the private sector, pay for performance is a virtually universal policy for white-collar workers at all levels," according to "Pay for Performance: A Guide for Federal Managers." "For federal agencies, this represents a fundamental change in compensation philosophy. The General Schedule, with its virtually automatic step increases, has long been criticized as responsible for contributing to an 'entitlement' culture."
The study was written by Howard Risher, a longtime consultant and author on performance pay issues who has also worked with the National Academy of Public Administration.
The Defense and Homeland Security departments are overhauling their civilian personnel structure, scrapping the GS system and initiating performance pay systems. Observers expect the reform movement to eventually spread across the federal government. Union leaders and some lawmakers, however, complain that worker's rights are being eroded and the performance pay proposal is ill-suited for those in public service.
Risher's report echoes the finding of several previous private reports that promoted pay for performance in the federal government. In August, the Coalition for Effective Change released a paper supporting pay for performance, but acknowledged that its implementation would be "neither easy nor quick."
The report also acknowledged that "It will take several years to develop and implement the new systems and gain acceptance for the new philosophy." Risher insists the move is necessary.
"The transition to pay for performance will not be easy, but it will better serve the needs of the federal government than the current General Schedule," Risher wrote.
The paper did not address the common complaint that performance pay - along with other private sector management tools - is suitable when the driving motivation is profit, but inappropriate when the goal is public service.
COMMENTS
- Several points of clarification: 1) the government does produce measurable goods and services (e.g., security is a measurable service, and most government staff help to produce more easily measurable goods and services, such as social security payments, grant processing, HR services, etc.) 2) pay for performance is already in place, and being strengthened, at GAO and other governement agencies, so I would like to see comments including pros and cons of the actual cases, not simply theory 3) governments worldwide are increasingly using performance as a basis for both evaluating programs and employees, therefore, it may be wiser to focus on how to make pay for performance work for 1)the public benefit, 2) an equitable environment that will serve to attract and retain productive employees note: I have worked private sector under full-blown pay for performance (3 years), federal sector (14 years, 6 at GAO under pay banding), and not-for-profit (2 years) I believe pay for performance is generally superior to what currently exists in most of the federal government, but (and its a big but) I believe managers must be held accountable for results of their organizations for pay for performance to be highly effective. GovExec.com reader Posted January 10, 2005 11:26 AM
- First, let me say pay for performance is nice in concept and I would embrace it if the Government could make it work. From personal experience, it never will. I am already well paid to do a job I am very capable of doing. However I have slowly been losing any power I had over controlling my career. I have always been a high performing employee, but that does not seem to matter. My duties have been taken away from me and farmed out to contractors, which I had to train to do my job. My opinions do not seem to matter and respect is non-existent. Government employment has turned into a very hostile working environment. Second "entitlement" is a Government management problem. If managers can not give employees appropriate evaluations, then yes the pay raises can be "automatic". The problem is in the Government rules/regulations and management layer, not the employees themselves. It is far easier for a manager to just rate all his/her employees the same and avoid conflict. Rating in honest manner opens the manager to all types of "problems". I have personally seen it many times. And the sad truth is, problem employees are the ones that usually know how to use the system to their greatest advantage. Change the rules, quotas, etc and a much more effect workforce would exist. I am all for pay for performance, but it needs to apply at all levels, management included. There also needs to be so significant changes in the current federal employment environment. You can not keep taking away duties from the government employee and pushing the employee off to the side and expect pay for performance to work. The management culture also needs significant changes. The Federal Government needs to make managers accountable just like private industry does. An ineffective manager seems to keep his/her position and the subordinates are the ones that pay the cost in RIFs, downgrades, and a hostile work atmosphere. While I do not fear pay for performance, I do not see how it is going to “fix” what is wrong with the current system. In fact, it might be a step backwards. While the “good ole boy” system never completely disappeared, pay for performance would certainly open some new doors for it find yet another pathway into the federal workforce culture. I say lets “fix” what is wrong with the workforce culture first. GovExec.com reader Posted November 24, 2004 3:05 PM
- There is one important topic missing in this long running discussion/debate. Let us look to the relatively recent establishment of the FERS system as a replacement for the supposedly outmoded CSRS retirement system. Once FERS was developed, a transition date was established and CSRS emmployees were given the opportunity to move to FERS if they were so inclined. It was NOT mandated that everyone would be forced into FERS on a given date. Why isn't there a similar proposal/option to the transition to this new evaluation system? If we are so interested in developing a transparent system that will further encourage new/future employees to have "revolving door" Federal/private sector work careers, why can't we establish the same type of FERS/CSRS criteria for establishing a cut over date to accomodate the war time/private sector equivalent requirements that are offered as the rationale for this dramatic change? Enable those to change if they want and let others finish their careers based on the legacy system under which they were hired. It seems that much of the respondent vitriol is based on being swept up in a dramatic change in which they were given no voice and in which they have no personal or professional interest. Let us clearly demarcate the two separate systems and encourage historians, economists and the public we serve to make the final determination whether they, and our country, were better served by the current system or the new system which supposedly is so superior. GovExec.com reader Posted November 22, 2004 11:43 AM
