Union disputes OPM claim of success in new pay systems

A federal employee union has disputed the accuracy of an Office of Personnel Management status report that claims success for the government’s performance-based pay efforts.

OPM said the report, issued Jan. 29, demonstrates “how far the federal government has already come in successfully using performance-based pay to create a results-oriented performance culture attractive to the next generation of federal employees.” The government’s 14 performance-based pay projects are “clearly” a cornerstone for future civil service reform, OPM said in the report.

However, Colleen Kelley, president of National Treasury Employees Union, said that the report “shows a patchwork of pay systems across the government that cannot collectively, or individually, be characterized as successful.”

Kelley said the report profiles pay systems at many agencies where NTEU represents employees, including the Federal Deposit Insurance Corp.; the Internal Revenue Service; the Transportation Security Administration; the Bureau of Alcohol, Tobacco, Firearms and Explosives; the Homeland Security Department; and others.

“NTEU has extensive frontline experience with alternative pay systems at these agencies and that experience is characterized by a slew of grievances, arbitrations, litigation, high attrition rates and rock-bottom employee morale,” Kelley said. “The problems may differ from agency to agency, but the reality is that each of these programs is terribly flawed.”

OPM’s report provides an updated view of all of the government’s performance-based pay systems, which cover more than 298,000 employees. The agency is responsible for overseeing the progress of these programs and using the results to improve workforce management policies and operations.

Among lessons learned so far from these programs, OPM identified:


  • Performance-based pay systems result in a stronger link between pay and performance than under longevity-based systems.

  • Achieving success entails significant effort,  but pays off by achieving a results-oriented performance culture.

  • Under these systems, managers and supervisors manage performance more effectively.

  • The ability to recruit and retain a high-quality workforce increases under performance-based pay systems.

  • Payroll cost discipline must be maintained as the systems expand and mature.


OPM concedes in the report that changing the pay culture at agencies takes time. “OPM studies of [performance-based pay systems] have shown that it takes at least five years for the majority of employees to be supportive of change — but the support inevitably emerges.”

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