NSPS employees can expect 2.26 percent pay boost

Defense Department employees still under the National Security Personnel System will see a pay boost this month, according to Pentagon leadership.

A Dec. 27, 2010, memo from Undersecretary of Defense for Personnel and Readiness Clifford Stanley clarifies the funding available for performance-based pay increases for more than 54,000 workers and creates a salary "control point," designed to match pay limits with those that will apply when employees transition out of NSPS.

According to a Defense spokeswoman, 2.26 percent of salaries within a given pay pool are available for performance-based pay increases. Employees will be eligible for performance-based bonuses that individual agencies will determine, but those awards are neither automatic nor guaranteed. According to the spokeswoman, agencies are still compiling the pay pool data for the 2010 payout, but employees must have received a rating of "3" or higher to be eligible for a performance award.

The 2.26 percent is used for calculating and budgeting the available funds for NSPS annual performance awards. Performance-based increases and raises under Accelerated Compensation for Developmental Positions, which recognizes improvement of employees in training programs and other developmental capacities, might be included in pay raise calculations, according to the memo.

A mandatory control point, however, prevents employees from receiving a performance-based raise if the increase will push their salary above Level IV of the Executive Schedule, or $155,500. The control point does not apply to physicians or dentists, who will be eligible for higher salaries matching those paid by the Veterans Affairs Department and the private sector, Stanley wrote.

Defense transferred nearly 172,000 employees, or 76 percent, back to the General Schedule in fiscal 2010, in keeping with department estimates. The remaining NSPS workers will move into alternative pay systems this spring, and all employees must transition by the end of 2011.

Congress repealed NSPS in the fiscal 2010 Defense authorization law, giving the department until Jan. 1, 2012, to roll back the controversial pay-for-performance system completely.

CLARIFICATION: This story was updated to reflect that some, but not all, NSPS employees could receive performance-based pay increases.