Feds Not Alone in Believing Raises Are Unfairly Distributed

When the Office of Personnel Management announced the results of its annual governmentwide survey of federal employees last month, acting OPM Director Margaret Weichert was quick to cite workers’ lack of satisfaction with how pay raises are tied to performance.

“Unfortunately, our people also continue to feel that the federal government fails to fully align with merit system principles when measuring performance against rewards; only 26 percent of our people believe pay raises depend on positive performance,” Weichert said in a statement on the Federal Employee Viewpoint Survey.

But a look at some other questions in the survey suggests employees have a somewhat more nuanced view of performance management at federal agencies.

Less than one-third (32 percent) of federal workers believe steps are taken to deal with poor performers, and 38 percent of employees believe that differences in performance are “recognized in a meaningful way,” the latest FEVS survey indicated. But fully 68 percent of feds said they were satisfied with their salary, 71 percent of respondents said they believe their own performance appraisal is a “fair reflection” of their performance, and the same percentage reported that they understood what they needed to do to achieve a different rating.

What drives a disconnect where employees are largely satisfied with their own performance review process and pay, but feel others’ treatment is unfair?

Bill Thomas, managing principal of Centric Performance and a panelist on the Society for Human Resource Management’s HR Disciplines Special Expertise Panel, said it is a common phenomenon in the private sector and is likely exacerbated in government by the typically paltry across-the-board pay raises authorized by the president or Congress for all eligible employees.

“I think it’s a big problem,” Thomas said. “The core reasons are, whether it’s a large organization or not, the reality is that managers can be very well intended and constructive and supportive when they do performance reviews with employees, but that organizations don’t necessarily make reward decisions or promotion decisions using the individual manager’s opinion as the driving force.”

Making matters worse, at least at federal agencies, is that the across-the-board pay raise approach used by the federal government—commonly called “the peanut butter approach” in the private sector—leads to employees, and particularly top performers, becoming dissatisfied with personnel decisions.

“A lot of managers at many organizations do that, and they do it because it’s easy and avoids confrontation,” Thomas said. “But it’s unpopular with top performers. It’s an effort not to disappoint everybody and not to hurt anyone’s feelings . . . but it dilutes your ability to differentiate real performance.”

Another aspect that can lead to a “disconnect” between an individual’s performance review and whether they receive a raise or promotion is that organizations often use systems to normalize reviews between managers who tend to grade employees more easily, and those who are more stringent. Even in jobs where expectations are supposed to be standardized, like in the federal sector, Thomas said managers are rarely trained enough to properly apply those standards.

“We need to help employees understand how we’re defining compensation and top performances,” he said. “[Managers] are terrible at having conversations with employees about pay and performance. I would say 75 percent of managers struggle having performance conversations with employees, and 95 percent struggle with pay-related conversations. It’s just really, really hard. And the answer is better training.”