Defense

New agency could bring new pay system

Federal employees who join the proposed Department of Homeland Security could end up under an entirely new pay system and lose their right to unionize under the Bush administration’s legislative proposal for the new department.

June 18, 2002

The legislation would also create a special contracting authority for consultants, experts and other individuals to provide services to the department without becoming government employees. "Normally, agencies are required to obtain these services by direct hire under competitive appointment or other procedures under civil service laws," the Bush administration's explanation of the legislation says. "While contracts that create employer-employee relationships are generally prohibited, the nature of the department's work may necessitate this additional flexibility in securing services." The Bush proposal also laid out the proposed salaries for officials of the Department of Homeland Security. The secretary would make the same salary as other Cabinet officials, which is $166,700 this year (Level I of the Executive Schedule). The deputy secretary would make $150,000 this year (Level II). Five undersecretaries, who would oversee the new department's five major divisions, would make the same salary as FBI Director Robert Mueller, which is $138,200 this year (Level III). The department's assistant secretaries, general counsel, chief financial officer, chief information officer and inspector general would be paid at Level IV of the Executive Schedule, which is $130,000 this year.

Federal employees who join the proposed Department of Homeland Security could end up under an entirely new pay system and lose their right to unionize under the Bush administration's legislative proposal for the new department. The administration sent its proposal to Capitol Hill on Tuesday. The proposal would give the new secretary of Homeland Security the power to sweep away existing federal personnel rules and regulations, including the current pay structure, labor-management rules and performance appraisal system. In their place, the secretary would be free to establish a special personnel system for the department's 170,000 employees-a move that could have a ripple effect on pay rates and personnel rules across government. The proposal would also let the secretary hire people more easily as individual contractors rather than as actual employees. Government officials said at a background briefing Tuesday that the legislation would allow employees to carry over their union affiliations and current pay rates to the new federal agency. Once the department is up and running, the secretary would work with the Office of Personnel Management to develop personnel rules. The secretary would also eventually decide whether to continue providing employees with union rights. "We can't speculate about the new secretary's decision," a government official said at the briefing. The Bush administration's legislative proposal places only three vague criteria on the department's personnel system. The legislation says the secretary, working with OPM officials, can create a system that "shall be flexible, contemporary and grounded in the public employment principles of merit and fitness." The secretary could also decide that existing federal personnel rules are sufficient for the department. Federal union leaders are wary of plans to exempt the new department from existing federal personnel rules and union rights. "The idea of giving the head of this new agency and the OPM director a blank check with regard to employee rights does an enormous disservice to the men and women not only in Customs but in every other affected agency," National Treasury Employee Union President Colleen Kelley said. NTEU represents thousands of Customs Service employees who would become employees of the Department of Homeland Security under the president's proposal. "We don't want politics and cronyism back in the federal government," American Federation of Government Employees President Bobby Harnage said earlier this month. AFGE represents employees at the Immigration and Naturalization Service, the Animal and Plant Health Inspection Service in the Agriculture Department and several other units that would be rolled into the new department. The government officials at the briefing said the special personnel authority would allow the new secretary to:

Get the right people in the right place at the right time.
Create a flexible and responsive system to attract and retain good people.
Pay employees market rates.
Ensure accountability for individual performance.

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