Defense ends performance-based pay for intelligence employees

Most Defense Department intelligence employees will no longer be paid directly based on their job performance.

In an Aug. 5 memorandum, Undersecretary of Defense for Intelligence James Clapper, who late Thursday was confirmed as the next director of national intelligence, wrote that except for National Geospatial-Intelligence Agency employees, the intelligence workforce will move from pay-for-performance to a compensation system similar to the General Schedule.

Defense Secretary Robert Gates' decision to scrap the pay-for-performance elements of the Defense Civilian Intelligence Personnel System came in response to concerns from the National Academy of Public Administration, which in June found that the implementation of DCIPS was rushed and left employees with an unclear understanding of the link between performance and pay. The panel did not recommend shutting down the system, however. In the memo, Clapper wrote that Defense still is committed to a "performance-driven culture" and will be awarding bonuses, awards and quality step increases based on how well employees do their jobs.

"Future Defense Intelligence base pay increases will not be directly linked to performance and employees will be aligned to a GS-like grade structure," he wrote. "The heart of the DCIPS program will stay intact, including the occupational structure, common performance management system and bonuses tied to performance."

The NAPA panel found leaders showed uneven levels of commitment and failed to communicate how performance-based pay fit with the intelligence mission, as well as disseminated inconsistent information about how DCIPS works. Rather than abandoning the system, however, Defense should take a "more thoughtful, incremental and methodical approach" to implementation, the report concluded. That could include better training, clearer communication with employees, creating a formal process for gathering feedback from workers, and establishing a program management office to increase accountability, NAPA said.

Clapper said the process for moving to a GS-like system has yet to be determined, adding no employees will lose pay as a result of the change.