GovernmentExecutive.com

Two senators have introduced an amendment to the fiscal 2010 Defense authorization bill that would advance a range of pay and benefits reforms for federal employees.

Sens. Daniel Akaka, D-Hawaii, and Susan Collins, R-Maine, unveiled language on Tuesday that would move federal employees in Alaska, Hawaii and the U.S. territories from cost-of-living-adjustments to the locality pay system that applies to workers in the contiguous United States. It also would let civil servants in the Federal Employees Retirement System count unused sick time toward their retirement benefits. And it would allow federal retirees to return to government to do part-time work for a limited number of hours without a reduction in their annuity payments.

A spokesman for Senate Majority Leader Harry Reid, D-Nev., said on Wednesday afternoon that he was not sure when the Senate would vote on amendments to the bill. The chamber has been mired in debate over funding for F-22 fighter jets the administration did not request. President Obama has said he will veto the authorization bill if it includes that funding.

Obama issued a statement of administration policy on Wednesday reiterating that stance, and expressing concern about a provision already in the Senate version that would require the rollback of the Defense Department's National Security Personnel System within one year of the bill's enactment. The provision gives the Defense secretary the authority to establish a "fair, credible and transparent" system for evaluating employees and linking job performance to compensation, and to establish a fund to provide incentive payments for employees. And it allows the secretary to stop the repeal by submitting a report to Congress within 60 days of the bill's enactment arguing that ending the program would not be in the best interests of the department and pledging changes.

Obama called both the Senate and House language premature given the ongoing Defense and Office of Personnel Management review of the pay-for-performance system. The panel conducting that review is due to deliver a preliminary report on Thursday.

The version of the authorization bill passed by the House in late June did not contain the language in the Akaka-Collins amendment allowing retirees to do part-time work without getting penalized on their annuities.

That provision has strong support from management groups, including the Federal Managers Association and the National Active and Retired Federal Employees Association. Labor unions are more skeptical of the general concept, arguing it could distract from efforts to recruit and train a new generation of federal workers. But the International Federation of Professional and Technical Engineers sent a letter to senators on Wednesday urging them to vote for the Akaka-Collins amendment, including the part-time provision because it places limits on how much retirees could work.

CORRECTION: The original version of this story mischaracterized Senate provisions relating to the National Security Personnel System.