Thursday, January 27, 2005

 

Civil Service Reform.

Today's WaPo has a story ("free" registration required; schmucks) on how the Department of Homeland Security is conducting a test of a new civil service pay structure intended to replace the General Schedule system with competitive, performance-based raises:

The Bush administration unveiled a new personnel system for the Department of Homeland Security yesterday that will dramatically change the way workers are paid, promoted, deployed and disciplined -- and soon the White House will ask Congress to grant all federal agencies similar authority to rewrite civil service rules governing their employees.

The new system will replace the half-century-old General Schedule, with its familiar 15 pay grades and raises based on time in a job, and install a system that more directly bases pay on occupation and annual performance evaluations, officials said. The new system has taken two years to develop and will require at least four more to implement, they said.
Of course, the civil service unions are upset:

Leaders of federal employee unions, however, immediately denounced the new DHS system and any plans to expand it government-wide. They said the system would undermine the morale of homeland security employees and make it harder to attract and keep talented workers. . .

"They are encouraging a management of coercion and intimidation," said John Gage, president of the American Federation of Government Employees. He added: "This is not a modern system. This is a step backward."
Full disclosure: while I am a civil servant, I'm not a union member, and I have no interest in becoming one.

The Post article is incomplete, however, as it fails to mention that, while DHS is the first Department to move entirely to a new salary system, DHS is *not* the first Department to implement these reforms. Many Pentagon civilians have been using a slightly modified version of this new system under a demonstration program. I should know; I'm paid under the demo program.

When I first got hired into the government out in California, I came in as GS pond scum. That meant that my raises were set by the GS pay tables, with ten steps in every grade. If, for example, you come in as a GS-12 Step 1, you'd make $54,221 in base pay. This number gets heavily modified by the locality pay adjustments depending upon where you live, meaning you can make as much as ~16% more working in Washington, or even as much as 26% more if you're a GS employee in the notoriously expensive San Jose/San Francisco area.

Now, what would happen every year is that, like passing go in Monopoly, you'd collect a step increase. A step your first year, a step your second year, and then another step every two years after that. If your job is only classified as as GS-12, as long as you're in that job you could never go above GS-12 Step 10 in salary, but even if you started out at Step 1, in eighteen years, you'd be a Step 10. In practice, most people see their GS grades move up from time to time, depending upon experience.

There are provisions for providing "performance awards," a.k.a. cash bonuses, but these are not guaranteed, and typically aren't all that much anyways (in my experience, $1000 to $2000 on average for a mid-level GS employee making $50K-$90K a year).

But at the most fundamental level, the GS system rewards seniority over performance, so seniority is what you get.

You could be the best employee in the office, and you'll get the same raise as the worst employee in the office. Just so you know, the worst employee in the office has been there for a dozen years, because he understands how bureaucratically difficult it is to fire a civil servant (*months* of paperwork, justifications and appeals). He knows that if he does the bare minimum in his job, he'll still get his raises on a set schedule. Not to mention the annual 2-5% cost of living adjustments, which come ON TOP of step increases and locality pay adjustments.

Yeah, being a government employee is a sweet gig, if you can get it.

However, the flaws in this system are obvious. Aside from the lack of flexibility in firing personnel-- something DHS is trying to reform as well, separately from the pay scale reform discussed in the Washington Post article-- the worst aspect of the GS system is contrary to what John Gage and the Unions say above: the GS system is worse for morale, and you *can't* attract talented people, let alone keep the talent you have.

Oh, sure, it's good for morale. . . if you suck at your job. But if you put in extra hours, take extra care to dot the i's and cross the t's, in the end, you're just like the schlub sitting next to you. And as government-provided entitlements like welfare have shown, when there's no incentive to work, work suffers. The Unions-- and their allies in Congress-- love to tout "patriotic motivation" as an incentive for government employees, but seriously: it's just a job, and at the end of the day, everyone wants a good paycheck.

As for the reformed system, I love how the WaPo describes it:
OPM officials said many details, such as salary levels and how performance will be measured, still need to be worked out. But as outlined, a former GS-10 worker, for instance, would not be able to count on the sort of regular pay increases that he received as he moved up within his pay grade over time. Instead, he would receive a raise only by meeting certain performance standards, although his pay could in theory increase faster than it would under the General Schedule if he is an exceptional worker. Base pay would be determined in part by his occupation and where in the country he works.
I bolded "in theory" because, at least in my job, the theory has worked quite well so far. I have no idea if I'm good at my job or not, but my supervisors seem to think so. As a result, my pay has increased far faster than it would have had I stayed under the GS system.

Another benefit of the reform-- the "pay band" system-- is that it eliminates many of the ceilings inherent in the GS scale. Remember how I wrote above, if your job is classified as a GS-12, you can't go above GS-12 Step 10? Well, pay banding doesn't work like that, because for the most part all it cares about is pay. Are you paid what you're worth? Are you paid comparable to what you'd make in the private sector?

In practice, the DoD paybands combined some of the GS grades. So, for instance, grades GS-11, 12, and 13 are now one big payband. That means an employee participating in the paybanding system could be brought in at the same pay as a GS-11 Step 1 but-- within as little as the time it takes to have your first annual review-- see their salary raised all the way up to GS-13 Step 10. Because, again, there are no limits to rewarding performance.

The flip side, of course, is that there's also no reason to give a raise if the employee didn't earn it. No more guaranteed raises each review cycle or two. Over time, that disincentive should help some to push out the dead weight.

On paper, at least in DoD, you can even suffer a pay decrease, although no lower than the bare minimum your job is classified to earn. I haven't met anyone who's had this happen, but it can happen. I wonder if DHS is implementing that aspect (or will be allowed to, once Congress weighs in).

One last point to make about the new system. One of the Unions' biggest complaints centers around who decides the pay raises. There is a misconception that, without the security afforded by the GS grade and step scale, civil servants will be left at the mercy of mercurial supervisors with the power to make or break their reviews. In my experience, while my direct supervisor has a lot of power early on in the process, ultimately my performance review and salary determination is made by a board of supervisors who can override my immediate supervisor's recommendation upon my appeal. Again, I've done pretty well so far, so I've never had to put the system to the test, but there are still plenty of safeguards in the reformed system.

The new system is not as safe as before, but with risk comes great rewards for those civil servants who earn them.

And, in the end, isn't that what we'd like to see out of Washington?


Comments:
As some regular readers of GR know, I am also a co-worker of Dave, although I am a contractor (...read scum) to the government, doing most of the same work that Dave does, only without the full weight and authority of the US Government behind my actions. I heartiuly second all Dave's comments on the new pay system and would like to add a bit of perspective from the contractor community to all of the GS's whining about the new system...

Get over it. The contractors that work for you have been under this crazy merit system forever. If I don't perform well, I don't get a good raise. If I don't perform at all, I get fired. And it doesn't take months of paperwork, just a quick buh-bye... Back a long time ago (the 80's) there were many more Daves in government offices than Anguses. Then the goverment decided to cut a lot of dead weight and have contractors perform as worker bees for govvies. (The DoD term for this is A-76 work...) Now we're at about 50/50 Daves and Anguses. Govvies take notice! Either get with the merit based system, or wait another decade and then the ratio will be 1 Dave and 20 Anguses and anthropologists will be trying to learn about the extinct species known as the goverment civilian...

Angus
 
Damnit Dave! I was all set to compose an email to you, hoping to talk you into writing about this topic. As bait, I was going to include this link:
http://smitten.com/
I came here looking for you addy and now you've blown my email to heck.
Ok, I'm done. It was actually a very well done post. You're a funny guy, to say the least, but I think I most enjoy your posts that deal with work related issues, such as this one.
There's an interesting story in _Charlie Wilson's War_ about a G-12 who more or less orchastrates the arming of the Afghans. Near the end of the war he resigns because he realizes he's reached the pinacle of his career very very early. Sad.
-Chris Mayhew
 
Chris--

Sorry to. . . disappoint?

(Glad you enjoy the posts. . . i can't joke around every day).
 
Venckman,you've never worked in the private sector.I've been there .They expect results.
 
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