GovernmentExecutive.com

Calling the federal pay system "balkanized to the point of a risk of failure," Office of Personnel Management Director John Berry said on Wednesday that he will pursue a significant reform of the civil service system within the next two years, with the goal of establishing a governmentwide pay-for-performance system.

"About every 50 years or so, someone tries to take on Title 5 reform...I think it's time again," Berry said at a meeting with reporters. "So we are going to [work] with all partners...and build a pay system that will last for another 50 years."

Berry said President Obama has asked him to prepare a three-pronged strategy to reform the law on federal employee pay: create a fair and credible performance appraisal and accountability system; develop training that would prepare employees for promotion and support them throughout their careers; and establish genuine parity between federal and private-sector salaries for employees in comparable occupations.

"I believe if we can deliver the first two [items], and they are serious and true, and will be understandable to employees, managers and the public, that we can convince the public that an adjustment on comparability is in order," Berry said, acknowledging that it would be difficult to establish pay comparability immediately during a recession.

He said he hoped that the administration and Congress, with help from employee groups and academics, could create a pay-for-performance system that would cover a large majority of federal employees. Berry said the new system should include large raises for a small group of truly outstanding performers, not just salary adjustments to account for the cost of living. He also noted that poor performers should be given a period of time in which to improve their work, or risk losing their jobs.

Berry acknowledged that designing a rigorous and sound system was a significant challenge, and doubted that any private sector company would dare hold itself up as a model for performance-based pay. But Berry said that during meetings with employee and managers' groups, even those organizations that opposed pay for performance during the Bush administration were willing to at least explore reforms.

"If we have good communication and open and honest negotiations, we can get there," Berry said. "No one has foreclosed this as an option, said, 'You're crazy, you're not going to get there, [or] I'm not going to participate.'"

Colleen Kelley, president of the National Treasury Employees Union, said that she looks forward to working with Berry on pay reform and appreciated a more collaborative approach.

"Director Berry knows that NTEU's mission is to ensure that the federal workforce is treated fairly," she said. "The previous administration's proposals did not, in our view, meet that objective."

Berry laid out an ambitious agenda in other areas as well. He has assigned teams drawn from multiple divisions at OPM to find ways to simplify the hiring process, design more ambitious work-life balance programs, and improve veterans' preference programs.

Berry said he hoped to make progress on all three of those priorities by June 2010. On hiring in particular, he wants to create mandates rather than recommendations. As an initial goal, he suggested eliminating Knowledge, Skills and Abilities statements in favor of resumes, and requiring agencies to use simplified descriptions in job postings.

"OPM has basically tried the nice way, which has been recommendations and sweetly asking" agencies to change, Berry said. "I don't see this effort as an attempt to build another set of nice options that people have a choice to use. It will be mandated in the federal government, and we will use the power of the president to make sure it's implemented in every agency."

Berry also said that the 10 extra points veterans receive on civil service exams was not sufficient. He said his goal was to make OPM "a modern headhunting firm for veterans," providing individual career counseling and placement services for veterans who have returned to the United States and hope to find work in civilian agencies.

In addition to reforming the pay system, Berry said his longer-term goals include increasing the diversity of the federal workforce and moving aggressively to control costs in the Federal Employees Health Benefits Program. He will appoint Christine Griffin, the former Equal Employment Opportunity commissioner, to head the agency's diversity reform efforts once she is confirmed as OPM deputy, Berry said.