2007 Pay Raise

**mlk_man** · 02-07-2006, 01:33 PM

Under Bush Budget, 2.2 Percent Raise Would Be Split Three Ways

By Stephen Barr

Tuesday, February 7, 2006; Page B02
The president's budget, released yesterday, would provide for a 2.2 percent pay raise for federal employees in January 2007 but also would add a new twist to federal pay -- what a senior administration official called "smart pay adjustments."
Under current practice, most of the money for the annual pay raise is allocated across the board, as a nationwide increase, and a small portion is parceled out by locality, to reflect labor market conditions.

About This Column

var technorati = new Technorati() ; technorati.setProperty('url','http://www.washingtonpost.com/wp-dyn/content/article/2006/02/06/AR2006020601602_Technorati.html') ; technorati.article = new item('Under Bush Budget, 2.2 Percent Raise Would Be Split Three Ways','http://www.washingtonpost.com/wp-dyn/content/article/2006/02/06/AR2006020601602.html','The president\'s budget, released yesterday, would provide for a 2.2 percent pay raise for federal employees in January 2007 but also would add a new twist to federal pay -- what a senior administration official called "smart pay adjustments."','Stephen Barr') ; document.write( technorati.getDisplaySidebar() ); The fiscal 2007 budget proposes using an additional factor -- recruitment and retention -- in distributing raises, officials said. Using three factors instead of two would provide the president with greater budget flexibility, they said.
Currently, when agencies face recruitment and retention problems, they petition the Office of Personnel Management for permission to pay higher salaries, called special rate pay. Agencies that offer higher rates must take them out of their own hides or persuade Congress to increase their salary and expense accounts.
Under the budget plan, agencies with hard-to-fill jobs could turn to the White House and OPM to obtain extra money to finance higher pay rates. That would reduce the amount of money available for the workforce in general, officials acknowledged.
"The idea is to direct some of the 2.2 percent pay increase money to specific occupations, grades and locations where we know we are having specific problems," one official said. "The total amount could be distributed in a way that makes more sense strategically."
Bush administration officials contend that the government's pay practices need to be overhauled to reflect differences in occupations and should be linked more rigorously to performance ratings. Some officials -- who believe that some federal employees are overpaid and that others are underpaid -- argue that the government needs to get away from providing the same raise to almost all federal employees.
Administration officials have drafted a proposal to abolish the General Schedule, the government's largest pay system, by 2010 and replace it with agency systems that would emphasize job performance and market demand for occupations. The proposal does not have a congressional sponsor.
The 2007 budget plan, if accepted by Congress, would move the administration a step closer to the goal of creating a more dynamic pay system, officials said.
In most years over the past two decades, Congress has modified the White House's pay plan to ensure that civil service and military personnel received similar raises, called pay parity. Although the 2007 budget would provide a 2.2 percent raise to civil service and military personnel, Alex Conant , a spokesman for the Office of Management and Budget, warned against making any parity comparisons.
"The proposed 2.2 percent 2007 civilian pay increase is comparable to the increases private-sector employees are experiencing. The 2.2 percent military pay raise is the same as is called for by current law," Conant said.
Some members of Congress who keep a keen eye on federal pay -- Reps. Steny H. Hoyer (D-Md.) and Thomas M. Davis III (R-Va.) and Sens. Susan Collins (R-Maine) and Daniel K. Akaka (D-Hawaii) -- said they were pleased that the president's budget broke with past practice and included the same rate of increase in pay for the civil service and the military.
Hoyer said the administration has "adopted the premise of parity," and Davis, through a spokesman, said "the administration at last is recognizing pay parity."
Those members of Congress also indicated that they will want more details from the administration about its pay package. "We are going to have to look at it very, very closely to see what the president has in mind," Hoyer said.
Union presidents, including John Gage of the American Federation of Government Employees and Colleen M. Kelley of the National Treasury Employees Union, said the proposed 2.2 percent raise would not make federal jobs more competitive and probably would not keep pace with inflation.
The president's proposed raise falls short of the requirements set out in a 1990 law aimed at closing a pay gap with the private sector, Hoyer said. But he said the growing costs of the Iraq war and other fiscal pressures make for "a tough fiscal situation, and we've got to work within that reality."

**Wimpy** · 05-27-2006, 03:45 PM

I gotta a better idea. Granted, there are hard to fill locations and occupations, but I would rather see them get their 'incentive' money from those neanderthal SES types who are not getting onboard with the COG/telecommuting initiative. One of the biggest drawbacks to filling positions in cities such as San Francisco is the cost of living. Federal workers in that area mitigate the cost of living by commuting very long distances...and with higher fuel costs...are getting squeezed.

Telecommuting is underutilized by managers who feel the need to see a physical body in a cubicle. Many of them have poor computer skills and are unable to evaluate performance using information systems. They need to be retired, fired, or their position outsourced to India. The savings could be spread among the lower hard to fill grades and combined with the 'family friendly' telecommute benefit, would eliminate the high turnover in some of these cities.

**Spaf** · 05-27-2006, 08:05 PM

Originally Posted by Wimpy

.......neanderthal SES types who are not getting onboard with the COG/telecommuting initiative......One of the biggest drawbacks to filling positions in cities is the cost of living. Federal workers .....commuting very long distances...and with higher fuel costs...are getting squeezed.

Telecommuting is underutilized by managers who feel the need to see a physical body in a cubicle. Many of them have poor computer skills and are unable to evaluate performance using information systems....

Couldn't agree with you more!

We finally got rid of our Neanderthal. Travel was out of sight! Our response was a nightmare. But we got our noses checked everday. We lost some employees because of the city commute expense. We lost good prospective employees for the same reason.

Finally GWB got on board, see: http://www.whitehouse.gov/news/relea...0010620-2.html
Our Secretary heads up the 21st Century Workforce Initiative. Been great so far. Travel has been cut in half, expenses reduced, and services improved.

The smart pay adjustment system in the hands of a Neanderthal will be misunderstood, missapplied and undermined. Good managers can use the system to hire and retain employees.

A smart pay adjustment for some of our clerical would have prevented them from leaving. The commute and parking was a $200 expense that they couldn't afford. But, our Neanderthals' at that time, were clueless.

Dave M · 05-27-2006, 08:38 PM

I am in one of those situations -- hard to fill difficult to retain high costs -- and we got OPM to set up a SSR for our series here in Key West. If that went away there could be an exodus.

Dave

**Machinist Mate** · 06-09-2006, 09:56 PM

All of us know each goverment agency is about 25% Stumps.As a manager,I no longer am required to reward these individuals.We all know there are houskeepers in Cleveland,Ohio,who make more than engineers at NASA.Miss S.Tubbs Jones will make sure everything remains the same though.Coming from private industry,I still cannot believe what I see on a day to day basis.

**FundSurfer** · 06-09-2006, 11:58 PM

Sounds like you, machinist mate, are in the Department of Homeland Security.

I've heard a little about the new system. What do the "troops" think of the new plan?

From what I understand, the new rating system will allow managers to reward hard workers. We have an awards program right now that doesn't work great. I know managers that just rotate who get awards. I know managers that are unwilling to rate someone for performance, unsatisfactory, because they are not willing to deal with the hassle. Why should this new system be any different?

I've also heard that the pay bands are wider. Won't that leave less incentive for people to apply for new jobs for a pay increase? We have trouble getting people to move to get new jobs now, I think this new system could make that worse.

I'm in favor of what the intentions of this change in pay for performance methodology, but what I've heard so far isn't encouraging.

**TiCKed** · 06-10-2006, 12:44 AM

Originally Posted by FundSurfer

Sounds like you, machinist mate, are in the Department of Homeland Security.

DHS isn't the only, or the first, to go on a merit pay system. Here in DON (Dept. of the Navy), there have been a few select agencies (NAVSEA engineering stations, mostly), that have gone that route. I've been in what has been called a "Demo" system since 1999. I've heard rumors of other selected agencies on similar systems.

The first thing you notice is that nobody is willing to discuss their pay any longer. Once was a time when EVERYONE knew what everyone else made, give or take a step. Now everyone is secretive.

As for your questions about promotions...I think it's become a real problem in my offices. Since the first line of management (Branch heads) are in the same band as the 4-5 year experience working level, there is real resistance to taking the added responsibility and headaches that come with the job. "Forced promotion" has become common.

When it comes to merit pay increases, the thing that some forget is that there is a limited pool of funds for raises. i.e. you can't give EVERYONE the maximum raise. What you give to one guy may come from what you could have given to another. In the end, the right people probably get the raises, and the right people probably get left behind....in general.

Problems in implementing ratings between different work groups have popped up. For instance, should a good employee in a poor branch really be awarded the same as a good employee in an outstanding branch? It isn't taken into account. The joke here is that everyone is looking for a group of idiots to work with.

So, I'm not really sure the system has been all that beneficial. Our system (and proposed systems??) still include the yearly COLA for everyone, so it's not like anyone is really suffering. The low performers get fewer raises, but that just results in low performers with an addition of a bad attitude.

I figured that eventually us "old timers" would start to see minimal raises once we got toward the top of the band. That is, compare a bright new kid with little pay to a bright old timer with a lot of pay, and the old timer would stop getting merit raises. Hasn't happened yet...and 6 or 7 years should be enough to make it apparent. Most of us who were GS-12's at the start of the system, (our previous "normal" working level), have glided into GS-13 pay without ever being promoted, or really scrutinized.

All in all, I'm neutral when merit pay is discussed. Hasn't been a boon, hasn't been a bust.

**mlk_man** · 06-10-2006, 02:16 AM

From what I 've been told, if you get a excellent score, you're guaranteed a certain percentage of your base pay. If you get a good or great score,, you might get something after all the excellents are paid out.

The thing is, supervisors do the grading. If a supervisor has only one subordinate, most likely that person will get an excellent everytime. This is opposed to a supervisor who has 10-20 subordinates and can't give excellents to everyone even though they may all work as a team, share the load equally and get along famously. Every system is flawed in some way. Be it govt or private sector. It always has and most likely always will come down not to what you know, but who you know. I almost said unless you go to work for yourself, but that just opens up a whole new can of worms. If you know I mean........

**TiCKed** · 06-10-2006, 03:41 AM

Originally Posted by mlk_man

From what I 've been told, if you get a excellent score, you're guaranteed a certain percentage of your base pay. If you get a good or great score,, you might get something after all the excellents are paid out.

Guess I don't know how other systems work....so you may be right.

I know our system was based on the GS system we just left. They took everyone's expected step increases, added all money set aside for bonuses, and set that as the "total payout". The theory was that you aren't giving out more or less than you would have under the normal GS system. Just adjusting who got the cash.

Each person is rated 0 through 4 paypoints, and each paypoint is given a dollar value. (This year, about $950 for the working level engineering grade, less for techs and admin. Paypoints can be either bonus one time awards, or continuing raises). The limiting factor is, the total amount of cash that can be awarded can't exceed the "total payout".

Can't give everyone 4 points, 'cause that will exceed the total payout. Can't give 0 to everyone, 'cause the total payout will be too low.

There is probably further guidance given to the managers that I don't know about....like "the average should be ~2 points"...or "nobody gets 0 or 4 unless you can specifically justify it"...or "X% must be bonus, the rest continuing"....etc.

There's quite a bit of bargaining and negotiating among the managers when payout time comes. Many people have been told "I wanted to give you more, but the points just aren't available."

Does the DHS system work the same? Don't know. The Navy as a whole is going to the merit pay system, but since we're already doing something like it, we're the last to convert.

**FundSurfer** · 06-10-2006, 04:07 PM

Thanks Ticked. That was good info.

**EW_ret** · 06-10-2006, 05:56 PM

TICKed,

Sounds like you may work same NAVSEA organization I worked at for twenty-six years. We went to the DEMO pay system at NSWC Dahlgren Division in March 1998. I received no merit pay increase during the seven and one-half years I was in the DEMO pay system. I did get the yearly COLA/locality pay increase along with everyone else. I retired last year with 36 years of federal service credit, and ten years in the military.

I was at step 8, GM-13 grade when I was forced into the DEMO pay system as a ND-4. The buy-in placed me at step 9, GM-13 for pay. I did not receive any merit pay increase the entire time I was in the DEMO pay system. I inquired into what it took in way to get that last 3% pay increase. I was told it was not organization policy to give an employee the last 3% pay increase. I was informed my job contribution to the organization was insufficient to warrant the merit pay increase. Instead I was given a bonus incentive award of around 2% (2 pay points) of pay every September. These bonus awards did not increase my high three average pay for retirement.

It was not an issue of performance, but rather management’s view of how important my job was to the organization. The only way to get ahead was to compete for a different job that was a bigger '"cog" in the organization machine. I then might qualify for a promotion to ND-5 (GS-14 and GS-15 pay)

Well, I decided to just coast until retirement. I soon learned the minimal effort required to get the yearly incentive bonus. In my opinion it just was not worth the effort and stress to do boring project work, and commute to Washington DC weekly. I became the typical government worker I loathed earlier in my career. Now I see why people in government develop the attitude they do after working for many years. I was "ticked" that I could not get that last 3% pay increase!!

**TiCKed** · 06-10-2006, 08:24 PM

Originally Posted by EWGuy

TICKed,

Sounds like you may work same NAVSEA organization I worked at for twenty-six years. We went to the DEMO pay system at NSWC Dahlgren Division in March 1998.

We are brothers of distant mothers.

I'm out of Corona, and like you guys, followed China Lake and PHD into the DEMO world.

And you point out some other problems with the "system".
1) It isn't consistent among the agencies. Each has their own local rules and policies. And even within an agency, there are discrepencies between work groups....some rewarded nicely, others being very strict.
2) You are correct that it was much more advantagous to mid-career people than late career. I've actually been very well treated by the system coming from GS-12 Step 7, (I think). Anyone already at or near the top of a band (GS-13's with years in service), didn't fair nearly as well.

I guess the key going forward is how well the Navy wide, DoD wide, and Civil Service wide systems are defined and enforced. History says it probably won't be pretty.