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Government Leader home > news stories
10/18/05
Alternate pay systems must accompany mission redefinition
By John L. Guerra
Special to Government Leader
Agency leaders hoping to implement salary plans that include performance raises and other private-sector practices won’t be able to simply overlay those pay regimes over their organizations, Comptroller General David Walker said during a recent hearing held by the Senate Homeland Security Subcommittee on Oversight of Government Management.
“Market-based and more performance-oriented pay is only one part—albeit a critical one—of a larger effort to improve the performance of an organization,” said Walker, head of the Government Accountability Office.
Federal agencies, for instance, will have to change how they classify, compensate, develop and motivate employees—an important facet of performance management. Congress exempts some agencies from traditional government pay regimes, including GAO, the Homeland Security and Defense departments, and the Federal Deposit Insurance Corporation.
Walker outlined three key areas where agencies must first change before new pay regimes can work:
- The shift to market-based and more performance-oriented pay must be part of a broader strategy of change management and performance improvement initiatives.
- Instead of simply overlaying new payment regimes atop agency performance management systems, employee expectations must be aligned with results. This includes fair and meaningful employee performance reviews where distinctions in employee performance occur. Performance will have to be linked to how well the employee contributes to organizational goals, instead of seniority and other traditional government measures.
- Agencies have to increase management capacity. This includes training and developing new and existing staff, especially committed leaders with vision and persistence to lead and facilitate change.
“There is widespread agreement that the basic approach to federal pay is broken … [but] pay increases are no longer an entitlement but should be based on employees’ contributions to the organization’s missions and goals,” Walker said.
Walker recounted various approaches agencies discussed during a March 2005 symposium on introducing market-based pay systems. The GAO, for instance, focused on a set of values and objectives to guide its new pay system, such as accountability, integrity and reliability. It also places greater emphasis on a person’s skill, knowledge and job performance and not simply how long an employee has been at the job.
Other organizations at the symposium considered the total mix of compensation when measuring employee pay. Base pay, tuition reimbursement, health care packages and retirement programs—all these should be considered when building a pay regime for employees.
Another hint: Build in safeguards to enhance fairness in pay decisions. Employees must be able to feel as if no one is getting more pay than others for unstated or vague reasons, for instance, Walker said.
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