Pentagon follows Congress' lead on NSPS raises

Employees under the Defense Department's new personnel system will still receive a pay raise equivalent to the formula Congress approved in an authorization bill, despite a presidential veto last week.

Pentagon officials said in a Web post Thursday that the 110,000 employees to convert to the National Security Personnel System in the first wave will receive 60 percent of the General Schedule's base pay increase as an adjustment to their base salary, provided they earn an acceptable performance rating. The remaining 40 percent will be added to the pay pools and distributed based on performance.

The General Schedule's final 2008 base pay raise will be 2.5 percent, with a 1 percent locality-based increase. Based on that formula, NSPS employees will be eligible for a 1.5 percent base pay raise, a 1 percent raise tied to job performance and a 1 percent locality pay supplement granted in the same manner as GS locality pay, according to officials.

NSPS employees who have not transitioned in the first wave and did not receive a 2007 final rating of record will receive the equivalent of the 2008 governmentwide increase, officials added.

The move marks a reversal of a September decision by Deputy Defense Secretary Gordon England to change the policy outlining the way NSPS employees would receive the 2008 pay increase, opting instead for a 50-50 split between base pay and performance-based increases. The plan angered many Defense employees, who feared they could receive a lower overall raise than the one slated for the General Schedule.

The decision spurred opposition from many lawmakers, who last month passed final authorizing legislation for Defense that would implement the 60-40 split. The bill also would restore collective bargaining and appeal rights for employees in NSPS.

But last week, President Bush pocket-vetoed the Defense authorization bill over an unrelated provision that would open up the Iraqi government to lawsuits.

While the department was not yet required to implement the 60-40 split recommended by Congress, England moved forward with the policy on Monday, said Tara Landis, an NSPS spokeswoman.

"The department has been working with Congress on a way ahead for NSPS," Landis said. "It made sense to align our policy with what is in the authorization bill, since we expect this will eventually apply."