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Key developments in the world of federal employee benefits: health, pay, and much more.

Pay Day


Under the House version of the fiscal 2009 defense authorization bill, which passed at the committee level last week, military members would receive a guaranteed pay raise of 0.5 percent above the Labor Department's Employment Cost Index from fiscal 2010 through fiscal 2013. The provision, if passed by Congress and signed by President Bush, likely would give labor unions an edge in pushing for an equivalent raise for federal civilian employees.

Similar language was included last year in the House version of the defense authorization bill, but the provision never made it into the final legislation.

Current military compensation law provides a formula that indexes the annual military pay raise to the annual ECI increase. The law was modified in the fiscal 2004 Defense Authorization Act, which mandated that military increases be calculated from the yearly growth of the ECI, with an additional 0.5 percent tacked on. But the 2004 law only required that add-on for three years, and called for raises from 2007 and after to equal the ECI.

For each year of his tenure, except 2007 and 2008, Bush has proposed a lower pay raise for civilian workers than for their military counterparts. But lawmakers generally have ignored the president's recommendations and given both groups the same raise. For 2008, Congress approved for civilians and service members a raise of 3.5 percent - 0.5 percent higher than the change in the ECI.

Congress appears on track to approve a military pay raise for fiscal 2009 of 3.9 percent - 0.5 percent higher than the boost Bush included in his most recent budget request. Bush proposed a 2.9 percent pay raise for federal civilian employees for 2009.

Rep. Thelma Drake, R-Va., sponsor of the amendment to require the higher pay increases, said the language would provide a guaranteed boost in military pay in future budgets, rather than relying on temporary fixes from year to year. She noted that extending slightly larger raises to the military was necessary to close the pay gap between members of the armed services and employees in the private sector.

"Our military families should not have to worry about their financial security from year to year," she said. "They deserve to know that the American people are taking care of their interests while they are fighting for ours."

Colleen Kelley, president of the National Treasury Employees Union, argued that the same was true for the federal civilian workforce, and pledged to lobby this year and in the future to ensure both groups received an adequate and equal raise.

"The White House proposal of a 2.9 percent raise for the civilian workforce was disappointing," Kelley said. "The continuing and growing bipartisan support in both the House and Senate for military-civilian pay parity is welcome and encouraging."

Scrapping the Schedule

Another federal agency is replacing the rigid, decades-old General Schedule pay system with one that links pay more closely with performance.

On May 9, the Agriculture Department said it planned to place 2,900 nonbargaining unit employees at the Food Safety and Inspection Service under a pilot pay-for-performance system for at least the next five years.

The Office of Personnel Management said in the Federal Register that the proposed project will test whether a performance-based pay system can be successful at USDA. OPM said testing at USDA was necessary, largely because current pay reforms at the Defense Department and Government Accountability Office do not cover occupations related to public health or food defense.

"The workforce covered by the proposed demonstration project is predominantly supervisory, and it is important to establish effective pay-for-performance policies and procedures for supervisory positions before extending such systems to large numbers of line-worker positions throughout the federal government," OPM said in the notice.

The new system at USDA aims to compress the 15 pay grades under the General Schedule system into six multigrade paybands. The process would eliminate the fixed steps that give automatic pay raises to employees and would make annual pay adjustments performance-sensitive.

According to the agency, the new pay system will strengthen USDA's performance culture, promote fairness, and provide the agency with motivational and retention tools. "The promise of higher pay increases for good performance will encourage achievement and promote the objective of improved individual and organizational performance," OPM said.

Reporter Portrait for

Brittany Ballenstedt writes Nextgov's Wired Workplace blog, which delves into the issues facing employees who work in the federal information technology sector. Before joining Nextgov, Brittany covered federal pay and benefits issues as a staff correspondent for Government Executive and served as an associate editor for National Journal's Technology Daily. She holds a bachelor's degree in journalism from Mansfield University and originally hails from Pennsylvania. She currently lives near Travis Air Force Base, Calif., where her husband is stationed.

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