Homeland bill includes personnel, benefits changes for all agencies

Agencies across the federal government will get new personnel powers and incentives for employees under the bill creating the new Homeland Security Department.

The governmentwide changes won't be anywhere close to the sweeping changes in personnel rules that the new department will be allowed to make. But the changes will affect how agencies hire employees, manage human resources, pay buyouts, cover employees' higher education costs and review the performance of senior executives.

"These flexibilities are not as comprehensive as what we were proposing for the new department, but they represent a good start on the path of reform in this critical area that has not received adequate attention by past administrations or Congress," Sen. George Voinovich, R-Ohio, said on the Senate floor this fall. "It is my hope that the incremental provisions I have developed with my colleagues and a diverse group of stakeholders over the course of the last year will assist the rest of the federal government while we consider next steps."

Voinovich and Sen. Daniel Akaka, D-Hawaii, sponsored the governmentwide personnel provisions. They were added to the homeland security bill during Senate Governmental Affair Committee deliberations this summer. Voinovich has pushed for more comprehensive reform of civil service rules, but federal unions and other groups have opposed major changes to the federal pay system, performance appraisal process and workplace dispute resolution process.

Eight governmentwide personnel provisions are included in the homeland security bill.

• Federal agencies will be able to use two new methods to speed up the hiring process and improve the quality of candidates. The first method is categorical ranking, in which applicants are divided into groups based on how qualified they are. Managers then pick employees from the top group. Agencies will be able to use categorical ranking instead of the "rule of three," under which managers can only choose one of the top three candidates recommended by their human resources staff. The bill also allows the Office of Personnel Management to grant direct hiring authority to agencies when they face a severe shortage of candidates or a critical hiring need.
• Agencies will be required to appoint "chief human capital officers" to oversee workforce management. Like chief information officers for technology and chief financial officers for finance, the positions are designed to elevate the importance of personnel issues in federal agencies.
• Agencies will be required to incorporate workforce planning into their strategic plans.
• Agencies will be able to offer buyouts to employees without eliminating any positions in their agencies. Such "workforce restructuring" buyouts will likely be aimed at federal workers whose jobs have become obsolete or whose skills are no longer needed.
• Agencies will be able to provide transit subsidies to student volunteers.
• Agencies will no longer have to recertify their senior executives every three years.
• The annual total compensation limit on senior executives will rise. If the change took place this year, the pay cap would increase from $166,700 to $192,600. The change will also allow executives to collect higher annual bonuses.. But agencies won't be able to take advantage of the higher limit unless they prove to OPM and the Office of Management and Budget that their senior executive performance appraisal systems make meaningful distinctions among executives' performance.
• Agencies will be able to more easily cover employees' higher education costs.

"The flexibilities included in this bill are meaningless if they are not funded," Stier said. "We are really at the beginning of the road. We're not at the end."