President seeks higher pay limit, more annual leave for federal executives

Senior federal executives would have a higher pay limit and could get more annual leave under legislation proposed by the Bush administration Monday. President Bush's proposed Managerial Flexibility Act of 2001 would raise the cap on total compensation for members of the Senior Executive Service (SES) and other high-paid civil servants from the pay rate for Cabinet secretaries to the pay rate for the Vice President. Cabinet secretaries earn $161,200 this year. The Vice President makes $186,300. The change would not raise executive pay. But it would allow executives who get major bonuses to collect them immediately. The current limit forces agency executives to spread out bonuses, such as the $44,000 Presidential Rank Award of Distinguished Executive, for their most senior staff. An SESer in Washington who earns a $133,700 salary this year is limited to $161,200 in total compensation under the current rule. If the executive received the presidential rank award, the government would hold back about $16,500 until next year. Bush's proposal would allow the executive to collect the whole award in one year. The proposal would also allow all SESers to automatically accrue eight hours of annual leave per biweekly pay period, or 26 vacation days per year. While most government executives already accrue that much time, executives hired from outside government are treated like entry-level employees and accrue only four hours per pay period. "Agencies and executives have reported that this is often a disincentive to recruiting experienced executives from the private sector," the Bush administration's description of the legislation says. The Bush legislation would sweeten the pot even more for private sector executives by letting agencies give a credit of up to 10 days of annual leave to any SESer hired from outside government. The leave could be used during the new executive's first year of service and would be in addition to regularly accrued leave. The extra leave would not be granted to executives promoted from within the government. The final SES-related provision of the Bush proposal would eliminate triennial recertification for executives. The recertification process is designed to weed out executives who aren't up to snuff, but the Bush administration said that the process is "redundant, ineffective and wasteful." Executive performance should be managed through the annual appraisal process, the administration said. National Treasury Employees Union President Colleen Kelley criticized the proposals for the SES, saying they would provide executives with a financial windfall and make them less accountable. "Increasing perks for senior executives … is the wrong message at the wrong time as front-line employees work overtime to safeguard our nation and deliver essential programs and services, during this critical time in our nation's history," Kelley said in a statement. The legislation does not include a number of ideas for SES reform that have been pushed in recent years, most notably a lift of the caps on basic salaries and base-plus-locality pay for SESers. Those caps are tied to congressional pay and have led to the phenomenon of pay compression, in which executives at the top three and, in some locations, top four of the six executive levels are paid the same salaries. Other proposed reforms left out of the legislation include splitting the SES into an executive track and a non-executive track, and requiring SESers to serve in more than one agency before they can be promoted above the third executive level.