Frankenstein's System

Experiments in changing the way federal employees are paid are everywhere. There's the National Security Personnel System; pay for performance for the Senior Executive Service; and pay reform in the intelligence community, the Securities and Exchange Commission, and the Internal Revenue Service. There's plenty of fodder for conversation. But missing amid all the sound and fury of compensation experiments is an overarching plan to determine what's working and what's not.

To some extent, letting agencies consider what's best for their workforces and designing separate pay systems for executives, managers and rank-and-file employees make sense. Different agencies have different needs. Different employees might be best evaluated by different systems and best motivated by different economic triggers. Agencies can use pay and performance systems to effect specific changes to their culture and to reinforce the effectiveness of other reforms.

The National Intelligence Directorate's new performance evaluation system is a perfect example of this kind of thinking: Chief Human Capital Officer Ron Sanders said he hopes common evaluation criteria will remove barriers to the intelligence agencies' joint-duty system and foster integration.

But changes to one pay system could affect how generous or fair another pay system seems.

"Departments and agencies have …undertaken other efforts to increase GS-15 managers' pay by taking advantage of certain flexibilities or requesting new authorities," Carol Bonosaro, president of the Senior Executives Association, said at the organization's conference in Washington on Tuesday. "The SES pay ceiling has not kept pace."

Because these changes are going on simultaneously, it's difficult to determine which ones are working best, and which systems hold promising solutions for the entire government. The federal pay system seems like a lumbering Frankenstein monster, with the torso drawn from the General Schedule and performance-based extremities crudely tacked on.

And that awkward image doesn't even include the decades-long efforts to bring public sector salaries in line with salaries in the private sector, or at least make them competitive. Locality pay has failed to narrow the gap. In fact, the conversation about locality pay seems to center more on preserving parity among federal employees than it does about catching up to the private sector.

It's not inappropriate to insist that reforming a pay system that covers millions of employees should be done carefully and with consideration of all the alternatives. But infinite delay is inexcusable, and the proliferation of pay system risks creating a permanent grass-is-always-greener mentality among employees who look to other agencies' programs when they are dissatisfied with their own compensation.

The Government Accountability Office plans to release an interim report on the SES pay and performance evaluation system across four agencies this summer, with a final report to come in the fall. That study will be a step in the right direction, taking a more holistic look at the impact of pay reform in one important area.

But the next president will inherit a workforce badly in need of an overhaul, as hundreds of thousands of baby boomers retire and the private sector competes hard for a small pool of millennial job candidates. Whoever next occupies the Oval Office should put serious pay reform, accomplished in a timely manner, near the top of the Office of Personnel Management director's list. The job will be difficult, but not unmanageable. After all, there will be lots of examples to examine and choose from.