Defense fine-tunes new personnel system regulations

The Defense Department's new personnel system will set up management rights limiting union bargaining and will enable the Pentagon to more easily assign work to civilian employees, according to Mary Lacey, the program executive officer in charge of the National Security Personnel System's design.

Though she said that no final decisions have been made about Defense's regulations, Lacey outlined some of the key principles that will undergird the new rules in an interview with Government Executive on Monday. She said that Defense's new system will allow managers more flexibility to assign civilian workers and that Defense would likely adopt rules akin to those proposed by the Homeland Security Department, which is also developing its own personnel system. In proposed regulations earlier this year, Homeland Security said that it would no longer bargain on the deployment of personnel, assignment of work and use of new technology.

According to Lacey, inflexible civilian personnel rules often cause Defense managers to assign tasks better suited for civilians to military and contractor personnel.

The 2004 Defense Authorization Act gave the Pentagon approval to set up a National Security Personnel System to replace the decades-old General Schedule pay system. The law allows the department to limit bargaining to the 41 national unions that represent Defense workers, instead of the more than 1,600 locals that the Pentagon previously had to assuage. But Lacey said NSPS decision-makers are still sorting out exactly how bargaining will occur. In some instances, she said, Defense officials will continue to negotiate with union locals.

Defense officials would establish rules to govern disciplinary appeals for workers, though Lacey added that no decisions had been made about the role Merit Systems Protection Board administrative judges would play in the new system. MSPB judges adjudicate disputes over employee discipline. Under the authorizing legislation for NSPS, the department can set up its own internal adjudicatory process, or continue to use MSPB judges. But the law requires that Defense employees still have the opportunity to appeal those decisions to the three-member MSPB in Washington. Lacey said existing MSPB rules are sometimes too lenient, given the Pentagon's national security mission. "The rules that make sense for [Defense] should apply," she said.

Defense was the first cabinet department to win authority to revamp the hiring process, which government managers have long viewed as cumbersome. The department may opt to compete only certain jobs in a specific geographical region, Lacey said, to cut down on the number of applications that would have to be vetted. She also said Defense would set up pay bands to allow managers to offer higher starting salaries, and would likely expand the number of professions where it uses "direct hire authority." Only the Office of Personnel Management can approve direct hires-or hires made without competition-to help agencies bring in people for specific hard-to-fill jobs.

Since taking over the NSPS design process in May, Lacey, former technical director of the Naval Surface Warfare Center, has put together six working groups that are now considering more than 200 potential options to cover everything from a pay system to employee discipline to labor relations. Those groups will finish their work this month, after which Lacey and her 10-person staff in cooperation with OPM will begin to draft regulations to implement the system. Those regulations are expected toward the end of the year. To gather ideas, Defense has held more than 100 focus groups and town hall meetings since the beginning of the summer at posts around the world, as well as meetings with unions and management associations, and other stakeholders.

Within the next few days, Lacey will begin to consider which agencies will be part of the "first spiral" to enter the new system, which is expected to include 15,000 to 100,000 workers by July 2005. At a recent town hall meeting at Fort Belvoir in Virginia, Raymond DuBois, Defense director of administration and management, nominated 7,000 employees who work in the Office of the Secretary of Defense and Washington Headquarters Services, as well as Defense organizations serviced by Washington Headquarters Services. A final announcement is slated for mid-October.