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Is pay for performance doomed to fail?

Why can't the federal government get pay-for-performance right? Large-scale efforts to implement such systems, most notably the Defense Department's National Security Personnel System, have faltered.

The question has surfaced because Rep. Dennis Ross (R-Fla.) is working toward developing another effort. As chairman of the House Oversight and Government Reform federal workforce subcommittee, he began holding hearings in March.

For most feds, the alternative to pay-for-performance is the General Schedule system, which has a total of 150 different pay levels -- 15 ranks and 10 "steps" within each rank. The salary for various job categories is set  for each level, with adjustments built in for employees who live in higher cost-of-living areas. The defined salaries give managers little freedom to play favorities -- or reward success.

Advancement on the GS system is more a matter of seniority than performance, or at least that is the perception. One FCW reader, commenting on an article about Ross's efforts, disputed that understanding.

"The 'GS' system is a 'pay for performance' system. Within-grade increases and promotions are contingent upon performance," the reader wrote. "The problem is that many managers cannot articulate the practical differences between pay grades and, thus, do poorly at defining performance elements and standards.”

Other readers said pay-for-performance doesn't work well in agencies because too many managers are apt to reward friends rather than the best performers, out of a limited funding pool available for pay raises.

"What is absolutely required for pay for performance to work is that the decision makers who get to decide who receives performance bonuses and/or raises have to be held personally accountable for those choices," wrote reader "Ted." "In private industry a manager can use cronyism and nepotism as her criteria when awarding performance pay, but that manager will be held accountable when her department fails to perform. Private industry doesn't tolerate for long those managers that cost the company money. The problem in the federal sector is that we've all seen instances of cronyism and nepotism, and if anybody tries to bring it to the attention of higher management that person gets labeled as a whiner and complainer."

A reader commenting on an earlier Workforce Wonk blog entry said that pay for performance does work in some individual government organizations.

"I have worked at a Navy lab with pay for performance since 1984," that reader wrote. "It's true that ratings are always somewhat subjective and there will be some favoritism. That's still far better than treating everyone the same regardless of performance."

So what do you think? Is pay for performance doomed to fail in the federal government -- at least on a large scale -- or is it possible to make it work? Share your opinion in the comments.

Posted on Apr 20, 2011 at 12:18 PM

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Reader comments

Tue, Apr 26, 2011 RayW

Reading the comments that have been posted, I get the impression that many of the folks who are posting (both civil service and contractors) have never worked outside the government.

When I worked in a Real Life environment, group sizes of 15-30 people per supervisor was common plus we had shift work and various facilities in two companies I worked for, yet one person is complaining that 2 supers per 28 workers was too much for the supervisors to keep track of, and shift work and different localities also made it impossible. Many of our supervisors were brought up from the ranks, just like in the Gov, and their training was provided by peer supervisors, so that should not be an issue either unlike what many folks are complaining about.

The Gov is at a disadvantage when it comes to good performance reports, the GS system is so watered down compared to a true evaluation system that all employees from the grunts to the top dog have no clue how to do one. Although that is one thing a lot of posters point at to say P4P should not be allowed, how can one get the experience to write good evaluations unless it is done?

I can say with experience in military, real life engineering, government engineering, and (shudder) casual labor that there is no such thing as a fair evaluation system. The GS system is just as prone to cronyism and graft as any other performance system, I just have to look at certain GS-14's who got there by that system yet they have no clue on even the simplest things that most of us peons do automatically. I saw in real life the system that the people who pay our salaries use (sort of like NSPS) the same thing happen, so it is not just the GS system or the old NSPS system that was unique.

As stated before, Pay For Performance will not fly in the Gov, the unions and the people who do not want to work harder/smarter/better will always be more vocal than those who do work, and the powers that control the system do not see results directly, just the verbiage.

Tue, Apr 26, 2011

P4P Will Not work above the grade of GS11 or any Managerial positions within the Government.Remenber the phrase - The Government should not work harder but smarter, like a civilian courporation :). See where that line of thinking has taken us, destroyed the best Managerial and Acquisition workforce that ever existed and we wonder about what happened. Think Purple Book...

Mon, Apr 25, 2011 Guillermo Midwest

Right now in my agency at my location we have 2 supervisors for 28 employees working a number of different shifts at 3 separate job locations. HOW can they possibly give a fair and objective evaluation of employee performance? They have so much to do they don't have time to be supervisors. No P4P system will work without a good supervisor to worker ratio and I can't see that happening as the constant matra is "we don't have any money!"

Mon, Apr 25, 2011 Hawaii Manager Hawaii

P4P will always be the bane of the public unions. Unions like AFGE are all about sustaining job security, maintaining status quo and defending mediocrity in the federal sector. They approach the entire world of the federal workplace differently than skilled and loyal leaders and managers do - focusing on the "victimhood" of the presumed un-represented individual contributor and defending against the right of that worker to be unmotivated and even openly disloyal to the organization that pays his/her salary. As long as that dynamic is allowed to persist in the USG, P4P will never achieve its true spirit and intent.

Mon, Apr 25, 2011 GSA MidWest

The experience I have in my agency is not so much cronyism as it is a lack of promoting good managerial practices. What I observe is that managerial training on how to write good and fair performance standards and how to measure performance, appears to be all but gone. My current performance standards are inadequately written and have had no major rewrite for 10 years. They are mostly subjective and cannot be supported. Since managers would be hard-pressed to prove that someone was performing below par, employees would always be successful. It hasn't always been that way in my agency but with changes in Federal Government FTEs and mandated policies, management of employees has been considered less important. The emphasis is the management of projects and programs.

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