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Bill proposes updating pay schedule with pay-for-performance system


BY 2010, federal workers' half-century-old pay scale would be replaced with a pay-for-performance system, and unions would have less control over day-to-day management practices under a sweeping government "modernization" bill being crafted at the Office of Management and Budget.

In a draft letter to leaders of the House and Senate, Dan G. Blair, acting director of the Office of Personnel Management, called the government's pay system, known as the General Schedule, a "failure."

The schedule, under which many workers automatically step up every year, would be replaced with pay bands for each occupation.

OPM and OMB -- and agencies with their permission -- would adjust a job's minimum and maximum salaries every year.

"This is especially critical in times of severe fiscal constraint," Blair's memo said. "The General Schedule (GS) is a failure in this regard, with its rigid, 'one size fits all' approach masking often dramatic disparities in the market value of different federal jobs. We simply cannot afford to over-pay for some occupations and under-pay for others."

Clay Johnson III, director of the president's "management agenda," would not comment on the legislation in an interview this week because it is not finished. But according to The Washington Post, OMB "limited" changes in the areas of collective bargaining and appeals of disciplinary action on the advice of three key members of Congress.

The bill "doesn't need to pick fights that would distract from the overall goal," said Robert White, a spokesman for the House Government Reform Committee, chaired by Rep. Tom Davis, a Virginia Republican.

The changes are not as sweeping as those planned for the Pentagon and Department of Homeland Security. But John Gage, leader of the American Federation of Government Employees, said yesterday that the draft bill, obtained and posted by, amounted to "union-busting" and an overall reduction in the salaries of government employees.

He also said that litigation likely would be required to clarify what rights unions retain under the changes. The bill would limit bargaining to decisions that cause "significant, substantial, and continuing adverse impacts on employees," but Gage said he was not sure what that meant.

Unions also would not have to be notified of management meetings with employees. And OPM could create "new hiring authorities" without Congress or executive order.

Federal workers would be divided into two categories: career and time-limited. But it is left to OPM to write rules on when time-limited appointments are appropriate, according to a section-by-section analysis of the bill.

The bill "is going to lower the quality of the civil service and really make it a second-class civil service," Gage said. "I don't know if the administration cares much about that. It has been a four-year assault on federal employees."

When asked when the bill would be introduced in Congress, Johnson said "in the future."

Johnson met with more than 250 employees in focus groups this year about how the government could manage its workforce in a way that would "spend taxpayers' money better," he said. The second part of the discussions focused on removing stigma attached to federal employment.

"The feedback was that there is a belief that employees of the federal government don't work very hard," he said. "They feel very strongly, and so do I, that the perception does not equal the reality. And we talked about how to make perceptions equal to reality."

Johnson said that changing personnel rules was discussed as one method of accomplishing that.

When asked why he excluded workers below GS-14 from the focus groups, Johnson replied: "We just didn't ... I'm sure I could learn a lot by meeting with the rank-and-file. The groups were not intended to be exhaustive."

The writer welcomes your comments and story ideas. She can be reached at melissa.har or 410-715- 2885. Back issues of Federal Workers can be accessed at

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