Pentagon fine-tunes personnel reforms

The Defense Department has tweaked its new personnel regulations for civilian employees in response to public comments, officials said at a press briefing Wednesday.

Chief among the modifications to the rules, which will cover 650,000 employees, is a limit on who can override collective bargaining agreements. The final regulations allow only the Defense Secretary, deputy secretary and "principal staff assistants" to override contracts.

In August, a federal judge ruled that the Homeland Security Department's personnel system was illegal because it did not adequately provide for collective bargaining, in large part because it gave management the power to override existing contracts at any time.

NSPS officials said that the law authorizing the Pentagon's system is different from the one authorizing DHS' system, in that it does allow for such a power.

The final regulations on the National Security Personnel System will be published Thursday in the Federal Register, Defense officials said. Officials did not provide text of the final regulations at the briefing. Instead, they provided a press release highlighting certain changes.

Another modification is the standard for mitigation of adverse actions under the Merit Systems Protection Board. In the draft regulations, employees could only have adverse actions mitigated if they were "wholly without justification." The new version narrows the standard down to "totally unwarranted in light of all pertinent circumstances."

The new standard is similar to that used by federal circuit courts, NSPS officials said, and while it is lighter than the one originally floated, it is still stricter than the current standard, which allows the board to reduce penalties that it finds unreasonably harsh.

Another key area reviewed in the DHS case was the role of the Federal Labor Relations Authority in handling labor disputes. The judge ruled that DHS did not have the power to put the FLRA in an appellate role, which it had done by creating an internal labor relations board as the first line of action.

After the judgment, DHS attempted to revise its system and remove the FLRA completely, but the judge said that did not allow for enough of a check on the internal board.

The Pentagon is moving ahead with its plan to use the FLRA as an appellate body for its own internal labor relations board, despite DHS' setback. George Nesterczuk of the Office of Personnel Management, which collaborated with the Defense Department on the NSPS, said that's because the law Congress passed to create the NSPS gave the department the specific authority to designate a body to an appellate role.

Unions are criticizing the Pentagon for failing to consult with them adequately while creating the system. NSPS was "developed without consideration of issues of concern to the unions that represent the department's civilian employees," the American Federation of Government Employees said in a statement Wednesday.

In the briefing, however, Navy Secretary Gordon England, who headed the NSPS effort in the Pentagon, said just the opposite.

"This has been, I believe, an extremely collaborative process," England said. "Frankly, whoever could help us has been consulted."

NSPS officials outlined the timing for rollout of the new system as well. The labor relations portion of the system will go into effect immediately after a mandated 30-day review by Congress. The human resources portion, including the pay-for-performance system, will be implemented in phases after that.

The first three phases cover General Schedule employees. The first will include 65,000 employees and will happen in February. The second will cover 48,000 employees and is set to happen in March or April, and the third, for 120,000 employees, will roll out in September or October of 2006.

Part of the plan is to replace locality pay with a more market-sensitive pay adjustment, so that two different professions in the same city could receive different pay raises based on the demand for that particular profession. NSPS officials said they will not implement this policy for at least a year, to give them time to conduct market surveys in each locality.