OPM Proposes Pay, Bargaining Changes in 2021 Budget

The Office of Personnel Management last week proposed legislation to change how most federal workers receive pay increases, as well as a measure to make it easier to implement policies to crack down on labor groups.

The pay proposal, published last week in OPM’s fiscal 2021 budget justification, appears aimed at slowing the pace at which most federal employees receive performance-based raises and redirecting that funding toward rewarding workers with what the government considers to be critical skills.

Under OPM’s plan, federal workers would have to wait an additional year before receiving a within-grade pay increase under the General Schedule and prevailing rate pay scales. In practice, that means employees would wait two years to progress to steps 2 through 4 within their pay grade, three years to progress to steps 5 through 7, and four years for steps 8 through 10. It also would strip workers of the right to appeal an agency decision that their performance does not warrant a step increase.

Additionally, the plan would require that employees be rated as "fully successful" in their performance reviews to advance to the steps 8 through 10 within their pay grade, rather than the current requirement that their performance merely be rated as "acceptable." And if an agency places an employee on a performance improvement plan, the waiting period for a step increase would be delayed by the length of the improvement plan.

OPM proposed that, in addition to these changes, Congress increase the amount agencies can offer employees through the Critical Position Pay authority up to the salary of the vice president, which last year was $246,900, and increase the number of people who can receive critical pay from 800 to 2,000.

The agency also suggested the establishment of a new Critical Skills Incentive, which would mean the OPM director could allow agencies to pay up to 25% more in basic pay to employees who possess “high-demand or shortage skills that serve a critical need.” Under this program, OPM would publish a list of skills that qualify for the program on an annual basis.

Under OPM’s plan, the caps on cash awards requiring the agency’s approval would increase from $10,000 to $25,000, and the cap on cash awards requiring the president’s agreement would increase from $25,000 to $50,000. These caps would continue to increase annually based on the increase in the Consumer Price Index.

In addition to the proposed pay changes, OPM asked Congress to get rid of the provision of federal sector labor law that requires agencies to wait to implement governmentwide rules if they conflict with an existing union contract. In the budget justification, OPM described this provision as an “anomaly” that “undermines the purpose of a uniform civil service.”

“Governmentwide regulations are promulgated to achieve governmentwide uniformity in interpreting and implementing the underlying statute,” OPM wrote. “Permitting agencies and unions to preempt the comprehensive scope of these regulations by agreement during the life of their contract wittingly or unwittingly creates incongruences among agencies and often within agencies for a number of years.”

The proposal comes as agencies across the federal government have worked at a variety of speeds to implement provisions of President Trump’s controversial workforce executive orders aimed at making it easier to fire federal employees and crack down on federal employee unions. Although a federal appeals court last year ruled against a legal challenge on jurisdictional grounds—finding that unions must first seek redress through the Federal Labor Relations Authority—agencies now must wait until it is time to renegotiate their contracts with labor groups to fully implement the orders.

In a statement Tuesday, National Treasury Employees Union National President Tony Reardon vowed to oppose the proposals.

“Within-grade increases are based on performance and delaying them—without any rationale or justification—is simply one more indiscriminate attack on those who chose a career of public service,” he said. “Indeed, delaying the within-grade increases ends up punishing those employees who are most successful and further limits their pay at a time when the gap between the salaries of federal employees and private-sector employees remains large. The proposal to allow governmentwide regulations to supersede existing contracts is a flat-out assault on the collective bargaining rights of federal employees. Allowing an administration to simply trample—and violate—legally binding contracts with its own workforce is a chilling escalation of this administration’s disdain for workers.”