[Senate Hearing 109-85]
[From the U.S. Government Publishing Office]
S. Hrg. 109-85
CRITICAL MISSION: ENSURING THE SUCCESS OF THE NATIONAL SECURITY
PERSONNEL SYSTEM
=======================================================================
HEARING
before the
OVERSIGHT OF GOVERNMENT MANAGEMENT,
THE FEDERAL WORKFORCE AND THE DISTRICT
OF COLUMBIA SUBCOMMITTEE
of the
COMMITTEE ON
HOMELAND SECURITY AND GOVERNMENTAL AFFAIRS
UNITED STATES SENATE
ONE HUNDRED NINTH CONGRESS
FIRST SESSION
__________
MARCH 15, 2005
__________
Printed for the use of the
Committee on Homeland Security and Governmental Affairs
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WASHINGTON : 2005
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COMMITTEE ON HOMELAND SECURITY AND GOVERNMENTAL AFFAIRS
SUSAN M. COLLINS, Maine, Chairman
TED STEVENS, Alaska JOSEPH I. LIEBERMAN, Connecticut
GEORGE V. VOINOVICH, Ohio CARL LEVIN, Michigan
NORM COLEMAN, Minnesota DANIEL K. AKAKA, Hawaii
TOM COBURN, Oklahoma THOMAS R. CARPER, Delaware
LINCOLN D. CHAFEE, Rhode Island MARK DAYTON, Minnesota
ROBERT F. BENNETT, Utah FRANK LAUTENBERG, New Jersey
PETE V. DOMENICI, New Mexico MARK PRYOR, Arkansas
JOHN W. WARNER, Virginia
Michael D. Bopp, Staff Director and Chief Counsel
Joyce A. Rechtschaffen, Minority Staff Director and Counsel
Amy B. Newhouse, Chief Clerk
OVERSIGHT OF GOVERNMENT MANAGEMENT, THE FEDERAL WORKFORCE AND THE
DISTRICT OF COLUMBIA SUBCOMMITTEE
GEORGE V. VOINOVICH, Ohio, Chairman
TED STEVENS, Alaska DANIEL K. AKAKA, Hawaii
NORM COLEMAN, Minnesota CARL LEVIN, Michigan
TOM COBURN, Oklahoma THOMAS R. CARPER, Delaware
LINCOLN D. CHAFEE, Rhode Island MARK DAYTON, Minnesota
ROBERT F. BENNETT, Utah FRANK LAUTENBERG, New Jersey
PETE V. DOMENICI, New Mexico MARK PRYOR, Arkansas
JOHN W. WARNER, Virginia
Andrew Richardson, Staff Director
Richard J. Kessler, Minority Staff Director
Nanci E. Langley, Minority Deputy Staff Director
Tara E. Baird, Chief Clerk
C O N T E N T S
------
Opening statements:
Page
Senator Voinovich............................................ 1
Senator Akaka................................................ 3
Senator Coburn............................................... 7
Senator Levin................................................ 19
Senator Pryor................................................ 21
Senator Warner............................................... 32
Prepared statement:
Senator Lautenberg........................................... 39
WITNESSES
Tuesday, March 15, 2005
Hon. David M. Walker, Comptroller General, U.S. Government
Accountability Office.......................................... 8
Hon. Charles S. Abell, Principal Deputy Under Secretary for
Personnel and Readiness, U.S. Department of Defense............ 10
George Nesterczuk, Senior Advisor to the Director on Department
of Defense, Office of Personnel Management..................... 12
Richard Oppedisano, National Secretary, Federal Managers
Association.................................................... 26
John Gage, President, American Federal of Government Employees... 28
Gregory J. Junemann, President, International Federation of
Professional and Technical Engineers........................... 30
Alphabetical List of Witnesses
Abell, Hon. Charles S.:
Testimony.................................................... 10
Prepared statement........................................... 72
Gage, John:
Testimony.................................................... 28
Prepared statement........................................... 124
Junemann, Gregory J.:
Testimony.................................................... 30
Prepared statement........................................... 138
Nesterzuk, George:
Testimony.................................................... 12
Prepared statement........................................... 87
Oppedisano, Richard:
Testimony.................................................... 26
Prepared statement........................................... 104
Walker, Hon. David:
Testimony.................................................... 8
Prepared statement........................................... 40
Appendix
Elmer L. Harmon, President, AFGE Local 2635, NCTAMS LANT DET,
Cutler, Maine, prepared statement.............................. 148
Questions and responses for the Record from:
Mr. Walker................................................... 149
Mr. Abell.................................................... 153
Mr. Nesterczuk............................................... 174
Mr. Oppedisano............................................... 180
Mr. Gage..................................................... 183
CRITICAL MISSION: ENSURING THE SUCCESS OF THE NATIONAL SECURITY
PERSONNEL SYSTEM
----------
TUESDAY, MARCH 15, 2005
U.S. Senate,
Oversight of Government Management, the Federal
Workforce, and the District of Columbia Subcommittee,
of the Committee on Homeland Security
and Governmental Affairs,
Washington, DC.
The Subcommittee met, pursuant to notice, at 10:05 a.m., in
room SD-342, Dirksen Senate Office Building, Hon. George V.
Voinovich, Chairman of the Subcommittee, presiding.
Present: Senators Voinovich, Coburn, Warner, Akaka, Levin,
and Pryor.
OPENING STATEMENT OF SENATOR VOINOVICH
Senator Voinovich. The hearing will come to order.
Good morning and thank you for coming. Today, this
Subcommittee convenes a hearing entitled, ``A Critical Mission:
Ensuring the Success of the National Security Personnel
System.'' The purpose of this hearing is to examine the
proposed regulations of the National Security Personnel System
and to continue the dialogue over its design.
When thinking about the Department of Defense, we often
visualize the over 2 million active duty and reserve men and
women in the Armed Forces. We are grateful to them for their
heroic service to our country, but we must not forget that
working alongside them are approximately 650,000 civilians who
can be found working across the globe in support of our
military.
These hardworking and dedicated individuals, including the
20,000 in my home State of Ohio, understand that the work that
they do every day is instrumental to our national security.
What responsibility could be more important than that? In April
2003, the Department of Defense presented to Congress a
proposal for new personnel flexibilities. In essence, Defense
sought similar and additional authorities to what was
authorized for the Department of Homeland Security to develop a
system that is able to respond to current and future workforce
and mission needs.
Through the National Defense Authorization Act for fiscal
year 2004, Congress granted the Department the authority to
design the National Security Personnel System (NSPS). The
proposed regulations for NSPS were published in the Federal
Register on Monday, February 14, 2005. The proposed regulations
have a 30-day public comment period. It closes tomorrow. Next,
the Department of Defense is required, by law, to enter into a
meet-and-confer process with its employee organizations that
must last a minimum of 30 days.
I understand that the process leading up to the publication
of the proposed regulations was not always smooth. I encourage
both sides to make the most of the meet-and-confer process, to
have a constructive dialogue on what is needed for the new
system. As with the Department of Homeland Security, I know
many employees and their union representatives at the
Department of Defense are concerned about the content of the
proposal and the subsequent implementation of NSPS.
Several Defense employees in Ohio will transition into NSPS
in a Spiral 1.1. Many of my constituents have taken the time to
phone or to E-mail me. They are uncertain what changes they
will see and unsure where to go to find the answers. One woman
who works for the Defense Finance and Accounting Service in
Columbus shared these thoughts with me in an E-mail:
``I understand that pay raises will be based on the
discretion of your supervisor. This causes me great concern, as
we have supervisors in our office who cannot take the time to
do quarterly appraisals and awards let alone write appraisals
to give them a raise. Also, we have asked management many
questions about NSPS, and it appears that nothing has really
been settled because they are unable to answer our questions.''
To the administration, I would say it is your obligation to
continue an open dialogue and maintain a collaborative process
with your employees as you refine the proposal regulations for
NSPS. It seems to me that the consensus of outside observers is
that the labor-management collaboration process at DOD was not
as open as the process at DHS, and I would invite all of
today's witnesses to share their thoughts on this point.
The Defense Department must recognize that while the new
personnel system is intended to assist it in responding to its
national security mission, it, also, must provide employees the
tools and structure to encourage, support and reward them.
Defense leaders must recognize that despite the Department's
experience with alternative personnel systems, the changes put
forth at NSPS are new for the majority of the employees at the
Department. It will take time to gain understanding.
The proposed regulations will impact the most fundamental
concerns of an employee: Will my contributions be recognized?
What are my opportunities for advancement and promotion? How
will I be paid? What recourse do I have if unfairly treated?
Employees must be able to see that they have a valued role
in shaping NSPS.
To employee organizations, it is your duty to roll up your
sleeves and work with the Department of Defense and the Office
of Personnel Management. It is not enough to say you do not
like the system. I ask you to continue to offer constructive
suggestions to improve the proposed regulations.
I want to assure all of you that I am committed to ensuring
the success of NSPS. The regulations are not finalized. The
publication of proposed regulation is only one of the many
milestones leading up to full implementation of NSPS. I know
there are many interested parties that have suggestions for
improvements. I am certain the Comptroller General, who I am
pleased to welcome back to the Subcommittee today, has some
thoughtful observations.
At times, I have had my own concerns with aspects of NSPS.
For example, this time last year, I learned the Department was
rushing to implement the system by October 2004. I thought this
was simply unrealistic. I was so concerned that I went over to
the Pentagon on March 30, 2004, and met with Deputy Secretary
Paul Wolfowitz, Secretary of the Navy Gordon England, and
Principal Deputy Undersecretary Charlie Abell, who I am pleased
is here today. I conveyed to them my concerns that the
Department was proceeding much too rapidly and that the massive
change envisioned by NSPS would take years to implement
properly. I was pleased to learn that they agreed and that
after a hasty start, implementation was to proceed with much
greater deliberation.
Secretary England was given a lead role and I had the
chance to meet with him yesterday to discuss his progress. For
the sake of continuity I am pleased that he is committed to
leading the initial implementation of NSPS regardless of what
secretariat he holds in the Defense Department.
I suspect there is room for improving the regulations in
the days ahead, and I have my own recommendations. For example,
there are differences between the final regulations for the
Department of Homeland Security and the proposed regulations
for the Department of Defense in areas such as labor
participation. I am interested to learn why DOD has chosen a
different path in some of those instances. I am certain my
colleagues here today have similar observations and
suggestions. I know the witnesses here today, representing
employees of the Department, have their own concerns and
suggestions for improvement. I look forward to discussing these
regulations and their responses with them.
I now yield to my good friend, the Senator from Hawaii,
Senator Akaka, and I want to thank you publicly for your
commitment to human capital issues of the Federal Government,
Senator.
OPENING STATEMENT OF SENATOR AKAKA
Senator Akaka. Thank you very much, Mr. Chairman. I, too,
am happy to work with you, my good friend and a champion
leading this movement.
I welcome our distinguished panelists this morning.
DOD had a rocky start when first rolling out NSPS last
year. I am pleased the Department started over after listening
to concerns expressed by many of us. Although there is wide
disagreement over the regulations, I very much appreciate the
time and effort that has gone into working with employees and
their unions and their representatives.
As the Ranking Member on this Subcommittee and the Armed
Services Readiness Subcommittee, I am disappointed with this
proposal, which I believe strips meaningful employee rights and
protections and raises serious questions of fairness and
collective bargaining and employee appeals. My concerns today
are the concerns I voiced in 2003, when I was one of three
Senators voting against NSPS. I am not alone in my concerns
and, Mr. Chairman, I do not recall a single issue in my 28
years in Congress that has generated more anxiety among Federal
workers in Hawaii than NSPS.
There are nearly 16,000 civilian DOD employees in Hawaii,
many of whom work at Pearl Harbor Naval Shipyard. I was
particularly moved by one shipyard worker's letter that
detailed how union and Metal Trades Council representatives
completed successful negotiations on a number of occasions,
resulting in improved efficiency and furthering labor
management relations. His fear of NSPS was stated clearly when
he wrote, ``The respect and trust developed and nurtured over
the years through formal discussions will be thrown out and
discarded.''
I know DOD and OPM are listening to these concerns, and I
am pleased that coalition meetings are continuing. These
meetings should be more than just exchanging concepts around
vague and general policy statements. NSPS will bring
significant changes. For example, collective bargaining on many
issues, such as deployment, will be curtailed. I find this
particularly egregious because DOD failed to prove during
congressional testimony that bargaining over deployment was a
problem. I know of no instance where union members have refused
reassignment of deployment; rather, the opposite is true. At
Pearl Harbor, the unions negotiated a long time ago on an
orderly process for job site mobilization. There are no
grievances over assignments, but there are grievances over not
going.
I am concerned with internal review boards, such as the
National Security Labor Relations Board, which are
fundamentally inconsistent with needed checks and balances on
government decisionmaking. Such boards lack credibility, blur
the relationship between the career civil service and elected
and appointed officials and could foster a back-door patronage
system.
The NSPS was intended to provide managers with workforce
flexibility not reduce the rights and protections of the civil
service. I have other very fundamental problems with the
proposed regulations, the first of which is the lack of detail.
In congressional testimony, David Chu noted, ``It is often said
that the devil is in the details, that best intentions may be
overcome by wrong-headed implementation. We--`that is DOD'--
welcome scrutiny of the details of our implementation.''
I agree the devil is in the details, but the proposed
regulations lack details especially in critical areas like the
compensation system.
My second concern is DOD's inability to assess accurately
the workforce needs. As the Chairman knows from last month's
hearing on the GAO High-Risk List, DOD has more programs on the
list than any other agency. The Department does not have a
Strategic Human Capital Plan in place, and no single document
identifies DOD's recruitment and retention strategy or goals
for its future workforce.
My third concern is over how DOD will implement the policy
directives embodied in the proposed rules especially when this
country is at war. The need to develop and fund the many
implementation programs, especially the training of managers
and employees, is a costly undertaking. Without a meaningful
and fully funded process, no policy directive can be effective.
GAO took almost 15 years to bring all of its employees under a
pay-for-performance system. DOD plans to do it in 3 to 4 years
without increasing the training budget or funds to reward good
performance. NSPS will require managers to make meaningful
distinctions when making appraisals and evaluations. Without
adequate training, this process is doomed.
DOD must also provide for transparency, accountability, and
fairness in its pay system. There is no process for challenging
a performance pay decision. I also urge DOD to reconsider the
virtual wholesale elimination of employee union bargaining
rights and the inability of DOD employees to have their appeals
impartially adjudicated.
Last, I urge flexibility and communication in carrying out
these regulations. DOD, by its organizational nature, operates
in a command and control environment. Employee input is
critical to the success of NSPS. And without union
participation, not just consultation, there will be no winners.
Limiting opportunities for employees to join unions and
minimizing or curtailing the ability of labor unions to
organize and bargain over issues that will have a direct and
sometimes adverse impact on how employees will do their jobs
guarantees failure.
Mr. Chairman, we have much to learn from today's hearing
and, again, I thank our witnesses and look forward to their
testimony.
Thank you very much, Mr. Chairman.
[The prepared statement of Senator Akaka follows:]
PREPARED STATEMENT OF SENATOR AKAKA
Thank you, Chairman Voinovich. Today's hearing focuses on the
regulations for the National Security Personnel System (NSPS) proposed
by the Department of Defense (DOD) and the Office of Personnel
Management (OPM). I join our Chairman in welcoming our panelists. Given
the rocky start that DOD had when first rolling out the NSPS a little
more than a year ago, I am pleased that the Department began anew after
heeding the concerns that I and other members of Congress expressed,
along with those voiced by employees and OPM. Although there is wide
disagreement over how successful the process turned out, I very much
appreciate the time and effort that has gone into working with
employees and their union representatives.
As the ranking member on this Subcommittee, as well as the ranking
Democrat on the Armed Services Readiness Subcommittee, I am
disappointed with the proposed regulations, which I believe
significantly strip key rights and protections of employees and raise
serious questions of fairness in collective bargaining and employee
appeals. The concerns I have today are the concerns I voiced in 2003
when I was one of three Senators who voted against the underlying bill
creating the NSPS.
I am not alone in my concerns, and Mr. Chairman, I do not recall a
single issue in my 28 years in Congress that has generated more anxiety
among federal workers in Hawaii than the NSPS. My state is home to over
16,000 civilian DOD employees, many of whom work at the Pearl Harbor
Naval Shipyard. I was particularly moved by one shipyard employee's
letter that detailed how union and Metal Trades Council representatives
in the Shipyard completed successful negotiations on a number of
occasions that resulted in improved efficiency and furthered labor-
management relations. His fear of the NSPS was simply stated when he
wrote, ``The respect and trust developed and nurtured over the years
through formal discussions will be thrown out and discarded.''
I know that DOD and OPM are listening to the concerns voiced by
employees, and I am pleased that the meetings with the United DOD
Workers Coalition are continuing. However, these meetings must be more
than the exchange of concepts developed around vague and general policy
statements. I know everyone who is providing input on the final
regulations understands just how significantly the NSPS will change the
way DOD hires--fires--pays --assigns--and works with employees.
As examples, the regulations would create an internal panel to
adjudicate labor-management disputes. Panel members would be appointed
and removed solely by the Secretary of Defense. Collective bargaining
on a number of issues, such as deployment, which has great impact on
employees and their families, will be curtailed.
--MORE--I find these examples particularly egregious because DOD
failed to prove during congressional testimony that such new
flexibilities were needed. I know of no instance where union members
have refused reassignment or deployment. Rather, the opposite is true.
Approximately 5,000 federal civilian workers have been mobilized and
serve in Afghanistan and Iraq. At Pearl Harbor, the unions negotiated a
long time ago on an orderly process for mobilization to a job site.
There are no grievances over assignments--but there are grievances over
not going! Deployments are all-volunteers. The Shipyard boasts an all-
volunteer fly away team that is able to change out nuclear submarine
batteries in seven days, a job that normally takes anywhere from 15 to
21 days.
I also know of repeated instances where DOD has refused to consider
transfer applications by civilian employees because they did not live
in the geographic area of the opening.
The creation of internal review boards is fundamentally
inconsistent with the Federal Government's long-held practice of
providing checks and balances in ensuring the integrity of government
decision-making. The Federal Labor Relations Authority (FLRA) was
created in 1978 by the Civil Service Reform Act (CSRA) to separate the
adjudication of labor-management disputes from the entity charged with
managing the federal workforce. It provides a stable and independent
forum to ensure an efficient and effective government. In my mind,
internal adjudication panels do not foster independence. They lack
credibility, blur the relationship between the career civil service and
elected and appointed officials, and could foster a backdoor patronage
system.
The NSPS was intended to provide managers with workforce
flexibility, not reduce the rights and protections of the civil
service. The NSPS is required to be based on federal merit principles
and provide for collective bargaining. Recombining the responsibilities
of employee protections and program management within DOD, while
limiting the power of independent agencies that oversee the
Department's activities, brings the Department's policies in direct
conflict with the fundamental principles of the federal civil service
and could substantially erode the rights and protections of federal
employees--both DOD and non-DOD employees.
For example, the regulations place time limits on the MSPB to
adjudicate cases which--given the size of DOD--will have a significant
and substantial adverse impact on MSPB's ability to timely adjudicate
the cases of non-DOD employees.
In addition, the regulations severely limit the discretion of MSPB
judges to mitigate penalties or award attorney fees, and requires
decisions to made in deference to DOD's national security mission. Even
more shocking is the fact that the regulations provide DOD with wide
discretion to review and reverse a MSPB administrative judge's initial
findings of fact. Therefore, the NSPS is comparable to a system that
would allow prosecutors to overturn the factual findings of a jury or a
district court, replace it with the prosecutor's determination of
facts, and require the appellate courts to be deferential to that
finding. The proposed changes undermine the MSPB's effectiveness for
serving as a neutral decision maker.
How credible can a system be that allows the employee's agency to
reverse the findings of a neutral decision maker?
These proposed NSPS rules will only lower employee morale, impair
DOD's recruitment and retention efforts, and impede--not aid--agency
mission.
I want our first panel to explain why they believe the regulations
are both fair and perceived as fair by employees, which is a stated
goal of DOD, and will promote agency mission.
I have other very fundamental problems with the proposed
regulations, the first of which is the lack of detail. In congressional
testimony, David Chu, Under Secretary of Defense for Personnel and
Readiness, noted, ``It is often said that the devil is in the details,
that best intentions may be overcome by wrongheaded implementation. We
welcome scrutiny of the details of our implementation.'' I agree the
devil is in the details, but the proposed regulations lack details.
Modern organizations recruit and retain employees through pay,
benefits, and improvements in work-life conditions. One of the most
important benefits to all employees is pay, which is why I am troubled
by the lack of detail given to the proposed NSPS compensation system.
My second concern is DOD's inability to assess accurately its
workforce needs. As the Chairman knows from our hearing last month on
the GAO High-Risk List, DOD has more programs on the list than any
other agency. The Department does not have a strategic human capital
plan in place. No single document identifies DOD's recruitment and
retention strategy or goals for its future workforce.
My third concern is over how DOD will implement the policy
directives embodied in the proposed rules, especially when this country
is at war. The need to develop and fund the myriad of implementation
programs, especially the training of managers and employees, is a
costly undertaking. Without a meaningful and fully-funded process, no
policy directive can be effective. GAO took almost 15 years to bring
all of its employees under a pay for performance system. DOD is
planning to do it in three to 4 years without increasing the training
budget or funds to reward good performers.
The NSPS is a performance-based system that will depend on managers
making meaningful distinctions when making appraisal evaluations.
Without adequate training, this process is doomed. Employees will be
grouped into occupational pay clusters that will be based on market
based compensation surveys. Getting these surveys and performance
appraisals right the first time is critical and not cheap. Given the
fact that most agencies fail to adequately fund training programs to
begin with, I question the decision by DOD not to increase resources
dedicated to training.
In addition, I believe that in order to be successful, DOD must
ensure that any pay for performance system has adequate funding. A
zero-sum reallocation of salaries and salary adjustments will guarantee
failure by rewarding a select few at the expense of the majority of
employees who do good work, thereby creating an atmosphere of distrust
among the workforce and lowering morale.
DOD must also provide for transparency, accountability, and
fairness in the system. The current regulations provide for an internal
process to challenge a performance evaluation and no process for
challenging a performance pay decision. Given the wide flexibility
granted to the Department to establish this new system, it imperative
that DOD uses this authority responsibly. Providing fair and
transparent systems to make pay and performance decision-makers
accountable is necessary.
I also urge DOD to reconsider the virtual wholesale elimination of
employee union bargaining rights and the inability of DOD employees to
have their appeals impartially adjudicated.
Last, I urge flexibility and communication in carrying out these
regulations. DOD, by its organizational nature, operates in a command
and control environment. Employee input is critical to the success of
the NSPS, and without union participation--not just consultation--there
will be no success. Limiting opportunities for employees to join unions
and minimizing or curtailing the ability of labor unions to organize
and bargain over issues that will have a direct and sometimes adverse
impact on how employees will do their jobs will guarantee failure.
There must also be defined roles for managers who under the NSPS will
be more accountable for agency performance.
Mr. Chairman, I believe we have much to learn from today's hearing.
I look forward to hearing from our distinguished witnesses who I hope
will rejoin us for future hearings as we continue our oversight
responsibilities of the NSPS.
Senator Voinovich. Thank you, Senator Akaka. Senator
Coburn.
OPENING STATEMENT OF SENATOR COBURN
Senator Coburn. Mr. Chairman, thank you for holding the
hearing. I want to welcome our guests. I look forward to
hearing your comments. I am excited about putting better
management into every level of the Federal Government. That has
two basic principles: One is it accomplishes the tasks that the
Congress has set out for the bureaucracies and, two, that it
treats employees the way they would want to be treated. I
think, if we follow those two guidelines, we are going to have
effective management and effective Federal employees.
And with that, I would yield back.
Senator Voinovich. As is the custom before this
Subcommittee, I am going to ask the witnesses to stand up and
be sworn in.
[Witnesses sworn en masse.]
Let the record show that the witnesses answered in the
affirmative.
I would like to ask all the witnesses to limit your oral
statement to 5 minutes and remind you that your entire written
statement will be entered into the record.
I would like to welcome the Hon. David Walker, Comptroller
General of the United States. Joining Mr. Walker on the first
panel are the Hon. Charles Abell, Principal Deputy
Undersecretary for Personnel and Readiness, Department of
Defense, and George Nesterczuk, Senior Advisor to the Director,
Office of Personnel Management.
Also, available for questions are Mary Lacey, Program
Executive Officer for the National Security Personnel System,
and Dr. Ronald Sanders, Associate Director for Strategic Human
Resource Policy, Office of Personnel Management.
Would Ms. Lacey and Mr. Sanders identify themselves.
Mr. Sanders, thank you.
Ms. Lacey, I had a nice talk yesterday with Secretary
England, and he tells me that you are doing a yeoman's job on
this whole issue. He is relying on you for a lot of good work.
I am sure that Mr. Abell is appreciative of all the effort and
time that you have put into this. I understand you are a 31-
year employee of the Department. It is reassuring to know you
are there.
Thank you all for the time you have invested in developing
the system. I commend you for your dedication to this important
job, and I know you have much to talk about.
We will start with Mr. Walker, who has been here time and
time again. David, nice to see you, again.
TESTIMONY OF HON. DAVID M. WALKER,\1\ COMPTROLLER GENERAL, U.S.
GENERAL ACCOUNTABILITY OFFICE
Mr. Walker. Good to see you, Mr. Chairman. Mr. Chairman,
Senator Akaka, and Senator Coburn, it is a pleasure to be back
with you. Thank you for entering my entire statement into the
record, and I will hit some highlights for you.
---------------------------------------------------------------------------
\1\ The prepared statement of Mr. Walker appears in the Appendix on
page 42.
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As you know, Mr. Chairman, Senators, I, as well as GAO, as
an organization, have been longstanding proponents of
modernizing our human capital policies and practices in the
Federal Government and are strong believers in the fact that
you need to have reasonable flexibility, at the same point in
time, appropriate safeguards to prevent abuse of employees.
The NSPS is of critical importance not just for the
Department of Defense, but, also, for the overall civil service
reform process. It is critically important they get it right
not just for the benefit of DOD and its employees, as well as
our Nation's national security, but, also, to try to make sure
that we can continue to modernize our human capital policies
and practices consistent with that balancing of interests
throughout the Federal Government.
As you mentioned, Mr. Chairman, the NSPS did not get off to
a great start. It did not represent a model process of
collaboration with the Congress, initially, nor at the initial
stages of attempted design and implementation. I must, however,
state that, in my opinion, there has been significant change
that occurred in the tone, the tenor, and the approach that the
Department of Defense has taken on this issue since Secretary
of the Navy Gordon England was designated as the point person
by Secretary Rumsfeld. I believe that Secretary England is a
capable and caring individual who wants to do the right thing.
I think we all need to recognize that the NSPS is now the
law of the land and, as a result, it is important that all
parties work together to try to help assure that it is
implemented both effectively and fairly. To do so, both
management and labor must work together in a good-faith manner.
Reasonable people can, and will, differ with regard to the
individual proposals under NSPS, but it is absolutely critical
that meaningful communications and consultations take place in
order to maximize the chance of success and minimize the
possibility of disruption.
These communications and consultations are a two-way
street, and we are entering a particularly important period, as
you mentioned, Mr. Chairman and the other Senators, namely the
meet-and-confer period, which will begin in the very near
future. It is very important that all parties take that
seriously and act constructively.
In my view, Mr. Chairman, both management leaders and labor
leaders will need to possess three key characteristics in order
for this to be successful:
Firest, they will have to have the courage to speak the
truth and to do the right thing, even though it may not be
popular;
Second, they will have to have the integrity to lead by
example and practice what they preach;
And third, they will have to be innovative enough to think
outside the box and help others see the way forward.
Both labor leaders and management leaders will have to
possess these three critical attributes. We at GAO, as you
mentioned, have been in this business for many years. We have
had broadbanding since 1989. We have had pay-for-performance
since 1989, although, as Senator Akaka mentioned, we brought it
out in phases. Now all but about 10 of our employees in GAO are
subject to broadbanding and pay-for-performance. We are happy
to share our knowledge and experiences. Our way is not the way,
but it is a way, and we do believe that we can help others see
their way forward here and, hopefully, avoid some pitfalls.
Now, I would like to mention one positive, one concern and
one point on the way forward.
The framework, I believe, that relates to these proposed
regulations does provide for a more flexible and modern human
capital system, and that part is a step in the right direction.
Second, an area of concern, there are many details that
have not been defined. The details matter. How these details
are defined can have a direct bearing on whether or not the
ultimate system is both reasoned and reasonable. And the meet-
and-confer period is critically important to try to help make
sure that both parties recognize that and come to the table in
good faith to try to deal with some of these details--details
in the areas of performance management, compensation,
reductions in force, appeal rights, transparency provisions,
training aspects, these are all critically important details.
And last, but not least, as I have said before, and as
Senator Akaka mentioned, DOD has 14 of 25 high-risk areas, up 2
from 2 years ago. DOD does many things right, including
fighting and winning armed conflicts, where it is unparalleled.
Nobody is even close. DOD is a ``D'' on economy, efficiency,
transparency, and accountability. It needs a chief management
officer or a chief operating officer to be in charge of the
overall business transformation effort, to take a strategic,
integrated, and persistent approach to a whole range of
business transformation issues, of which NSPS is but one, but a
critically important one.
Thank you, Mr. Chairman.
Senator Voinovich. Thank you, Mr. Walker. Mr. Abell.
TESTIMONY OF HON. CHARLES S. ABELL,\1\ PRINCIPAL DEPUTY UNDER
SECRETARY FOR PERSONNEL AND READINESS, U.S. DEPARTMENT OF
DEFENSE
Mr. Abell. Thank you, Mr. Chairman, and Members of the
Subcommittee.
---------------------------------------------------------------------------
\1\ The prepared statement of Mr. Abell appears in the Appendix on
page 74.
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The National Security Personnel System is a key part of a
DOD transformation. We will create a total force, uniformed
military and civilian employees, who share a common vision, who
recognize common strategic and organizational objectives and
who operate as one cohesive unit. DOD civilians are unique in
government in that they are an integral part of an organization
that has a military mission, a national security mission. DOD
civilians are at work side-by-side with our uniformed military
personnel around the world in every time zone every day. NSPS
will bring 21st Century human resource management to these
dedicated public servants.
NSPS has been designed to meet a number of essential
requirements. Our guiding principles, as we designed this, were
mission first; respect the individual; protect the rights
guaranteed by law; value talent, performance and leadership,
and commitment to public service; be flexible, understandable,
credible, responsive, and executable; to balance the HR system
interoperability with the unique mission requirements; and to
be competitive and cost effective. We have key performance
parameters that implement these guiding principles with
measurable metrics.
As you noted, Mr. Chairman, NSPS was enacted on November
24, 2003. And since January 2004, we have been engaged in a
process to design the HR appeals and labor relations system in
an open, collaborative environment, in consultation with our
employees, the unions, and other interest groups.
Since January 2004, we have met face-to-face with
employees, unions, and interest groups in many settings, as
well as maintaining two-way communications via written
correspondence, conversations and exchanges of documents. Based
on feedback from the unions and congressional committees in
March 2004, as you noted. Sir, the Department adjusted the
process, established a different governance and enhanced our
partnership with OPM.
The proposed regulations published in the Federal Register
on February 14, 2005, reflect the result of this adjusted
process. We are currently in the public comment phase, which
will formally close tomorrow, March 16. We anticipate comments
will come in after the March 16 deadline, and we will certainly
review those comments as well. The Federal Register notice is
the formal notice required by the statute. Following the 30-day
comment period, we will review the comments, and then we will
engage in a meet-and-confer process for a minimum of 30 days.
Mr. Chairman, I stress the word ``minimum.'' We will devote
the time necessary to adequately discuss and confer on every
issue raised during the comment period, and this is where the
details that so many long for will begin to emerge. We have
asked the Federal Mediation and Conciliation Service to assist
us in this meet-and-confer process. At the conclusion of the
meet-and-confer period, we will report the results to our
congressional oversight committees.
I suspect that we will spend some time today talking about
what NSPS does, but let me take a minute to talk about what
NSPS does not do. It does not change the merit system
principles that are the foundation of the civil service system.
It does not change prohibited personnel practice rules. It does
not change whistleblower protections nor anti-discrimination
laws. It does not modify or diminish veterans preference. It
does not change employee benefits, such as health care, life
insurance, retirement and so forth. It does preserve due
process for employees, and it does not reduce opportunities for
training and professional development.
On the other hand, the National Security Personnel System
will provide a streamlined, more responsive hiring process,
simplified pay banding structure, which will allow us
flexibility in assigning work, performance-based management
that is linked to strategic and organizational goals and
includes accountability at all levels, pay increases based on
performance rather than longevity, efficient, faster procedures
for addressing performance and disciplinary issues, while
protecting due process rights, and a labor relations system
that recognizes our national security mission, while preserving
collective bargaining rights of employees.
Although we plan to implement the labor relations system
DOD-wide, we intend to phase in the HR system beginning as
early as July of this year. We expect full implementation by
late 2007 or perhaps early into 2008.
We recognize that the National Security Personnel System is
a significant change, but these are necessary changes. We will
meet the challenge of change and change management willingly.
Senator Akaka talked to the value of training. We agree. We
are committed to training employees, managers, supervisors. We
are committed to the collaborative approach that we have used
to get to this point. We understand the concern and the anxiety
of our employees. It would be unnatural if they were not
concerned or anxious. We will address those concerns.
NSPS is the right system, based on the right philosophy, at
the right time in our history. The Department, in partnership
with the Office of Personnel Management, the unions, interest
groups, and our employees will implement it with efficiency,
effectiveness, transparency, and sensitivity.
Mr. Chairman, before I close, I would like to recognize the
great contributions of my partner, George Nesterczuk, Dr. Ron
Sanders and Mary Lacey. As you mentioned, they have been
invaluable in helping us get to where we are, and they are
going to be part of the team that takes us all the way home.
Thank you, Mr. Chairman.
Senator Voinovich. Thank you, Mr. Abell. Mr. Nesterczuk.
TESTIMONY OF GEORGE NESTERCZUK,\1\ SENIOR ADVISOR TO THE
DIRECTOR ON DEPARTMENT OF DEFENSE, OFFICE OF PERSONNEL
MANAGEMENT
Mr. Nesterczuk. Thank you, Mr. Chairman, and Members of the
Subcommittee. I want to thank you for holding this hearing at
this particular time. It comes at a critical time in the
process of developing the NSPS regulations.
---------------------------------------------------------------------------
\1\ The prepared statement of Mr. Nesterczuk appears in the
Appendix on page 89.
---------------------------------------------------------------------------
As you mentioned, we recently published the proposed
regulations, and we are coming to conclusion on an initial 30-
day comment period. It is an important part of our regulatory
process, getting input from various constituencies, employees,
and the general public, as well as the employee representatives
of the Department. We are looking forward to analyzing, and
assessing those inputs as we proceed in developing final
regulations over the coming weeks and months.
I would like to thank DOD for the collaboration that we
have engaged in. After an initial rough start, as you
mentioned, we have had a year's worth of excellent cooperation,
leading to what I think is a fairly decent proposal in our
initial stab at the regulations.
As we developed the proposal, we kept in mind the
importance of keeping balance before everyone; balancing the
interests of the Department, the vital mission that it has to
accomplish, while, at the same time, not compromising the core
principles of the civil service, and that is the principles of
merit and fairness to our employees. That is the backbone of
having the type of democracy and respect for government that we
enjoy.
We have, also, had to maintain a balance between the
operational imperatives and employee interests in all of the
specific components of the NSPS: Performance-based pay,
staffing flexibilities, employee accountability and due
process, as well as the reforms in labor-management relations.
In striking those balances, we paid particular attention,
as Mr. Abell mentioned, to protecting merit system principles,
making sure that prohibited personnel practices are adhered to,
that due process for employees is guaranteed, veterans
preference is fully protected, and that employees do enjoy the
right to representation and collective bargaining. I believe we
have achieved those balances properly in our proposal.
As we have mentioned, the outreach that we engaged in over
the past year has been very instrumental in promoting
credibility and acceptance, ultimately, of the NSPS
regulations. DOD arranged a number of focus groups and town
hall meetings throughout its installations around the world.
Thousands of employees were directly engaged. DOD created an
interactive website which provided access to a far greater
audience, interactive in that questions could be raised and
responded to while information was disseminated about the
process.
We were, also, well-informed by the DHS experience, the
Department of Homeland Security, which was ongoing at the time
and which provided some valuable input on labor-management
relations and the perspectives of unions on some of these
proposals. We were able to feed that into our development
process.
DOD, also, brought 25 years' worth of direct hands-on
experience with alternative personnel systems and alternative
pay systems through their demonstrations that they have been
running. OPM has done extensive analysis of those. We provided
that analysis to the working groups and teams and shared those
with the unions in the course of our engagement.
The meet-and-confer process that is upcoming is critical to
the continued development process. There are a number of issues
that have not been defined in great detail, specifically,
because we are looking for the input from the unions on ways to
go. Some of the proposals are necessarily general to provide
DOD with the flexibilities that they will need at the
implementation level and subsequent evolution of the pay
systems and the performance systems. So we have left those as
enabling regulations purposely.
There is a level of detail that we can still get to for
clarification in the meet-and-confer process. And we recently
met with the unions to try to start to define that process, and
to coordinate schedules. We do look forward to constructive
comment from the unions. Should we fail to reach those, that
would be a lost opportunity, and I think the members of the
unions would be shortchanged in the process. We have reached
out, and we will continue to reach out, and the meet-and-confer
process, I think, will be the proof of the pudding in that.
Thank you.
Senator Voinovich. Thank you very much. We will have 6-
minute rounds of questions. I will begin.
DOD has laid out an aggressive implementation strategy. It
is my understanding that implementation will occur in 3 phases,
or spirals, and that Spiral 1 will take approximately 18
months. According to Secretary England, DOD will begin
implementation with 60,000 employees. How did the Department
decide which organizations will be in that first spiral? What
steps has the Department taken thus far to prepare employees
transitioning into NSPS this summer? And as Senator Akaka
mentioned, I share his concern regarding training of managers
and the Department's communication strategy with employees?
The biggest issue is employee training and budget. How do
you anticipate initiating implementation of this new system?
Mr. Abell. Yes, sir. I will try to address those in the
order that you asked them, sir.
First, how did we identify the folks to be in Spiral 1. We
went out to the services and to the Defense agencies and asked
for those who felt they were ready, those organizations that
had a desire to move to NSPS, but, also, with a caveat that
these ought to be organizations that we would evaluate these
organizations who volunteered as to where were they in
performance management, did they have a strategy where their
work could be linked to the organizational and, ultimately,
strategic goals of the organization.
So we asked for input from the units themselves, from the
major commands and the units. We also said that at the end of
Spiral 1 we wanted an organization to be--we wanted it to be an
entire organization it was in. For instance, Air Force Materiel
Command or an Army unit or a Navy systems command, so that we
did not have people everywhere.
We exempted in Spiral 1 wage grade and NAF employees
because they present unique challenges, and we did not want to
try and take on all of those challenges in the first round. So
the units came in, the organizations came in volunteered at the
service and OSD level, we evaluated against our criteria, and
that is how they were selected.
The transition is one that will be managed. It is a change
management process. It involves training. It involves mock
payouts, if you will, so that we can tell whether or not our
training has taken effect.
Senator Voinovich. Have you included in your budget funding
for training? Will it be conducted in house or with contractor
assistance?
Mr. Abell. The answer is, yes, sir. We are going to do
both. The PEO's office has a modest budget and is doing
training development. The actual execution will be done in the
services. It is difficult to look at a budget and see the
training lines in there because there is money in those budgets
every year for training, and it is an O&M account, which is a
fungible account, as you know well. So the components will pay
for that. There is not an NSPS training line, per se.
Senator Voinovich. Well, I would like to see in writing
what you allocated in the budget for the training of these
individuals.
Mr. Abell. OK, sir. We will send that to you,
You mentioned a communication strategy--we have also begun
that. Ms. Lacey hosted a meeting for the commanders and the
senior leaders of the organizations that are going to be in
Spiral 1. Secretary England came down and spent a day with
those folks. This began the orientation process. We have done,
as you have heard reported here, focus groups, nd town hall
meetings. We intend to continue that. We have command
information programs. We have informal e-mails from the PEO's
office out to the commands that keep them up-to-date, and we
have a very active website that keeps everyone up-to-date.
Senator Voinovich. What I hear is that the Department has
not done well with that. However, once the meet and confer
process is over, you will have more details to answer the
questions of the employees.
Mr. Abell. Yes, sir. We see two types of training: First,
what we call the soft skills, which is management, change
management, and performance management, how one does that. And
then the second type of training does follow the more--once the
regulations have been fluffed up with the details, that is when
the specific HR management training can occur. So it is a two-
sided training system. We are already in the first part.
I am just about out of my time. I think what I will do is I
will turn this over to--well, Mr. Walker, you are probably
going to have to answer these questions from some of the other
Senators here. In past hearings, you highlighted the importance
of an internal DOD infrastructure to incorporate human capital
planning process that is integrated with its mission, develop
the internal workforce capable to develop and implement a human
resource system and a validated performance appraisal system.
The real issue is, yes or no, have you watched the system
enough that you can answer these three questions?
Mr. Walker. What I have said, Mr. Chairman, is that we
believe it is critically important that an adequate
infrastructure be in place that has been designed, tested and
where appropriate training has been provided with regard to
that system before the additional flexibility should be
operationalized.
I would imagine that the Department of Defense plans to do
that. I think it is critical that they do, if they do not, it
will likely not be successful. But there is a lot of work that
is going to have to be done to get them to that point. I don't
know who their Spiral 1 entities are, but I think the other
thing they ought to think about is there are two ways to look
at roll-out.
One way to look at roll-out is by organization, which is
very vertical, and that is, obviously, relevant to consider.
But another way to look at roll-out is horizontal, which is by
functional area of responsibility, which cuts across a bunch of
silos, many of which are hardened at DOD, silos such as the
various services and other functional units, and I would hope
they would think about the horizontal dimension as well. When
you develop core competencies many times you will find that
there are some that go throughout the organization, but there
are others that very much lend themselves toward horizontal
application across many different organizations.
Senator Voinovich. Thank you. Senator Akaka.
Senator Akaka. Thank you very much, Mr. Chairman.
Undersecretary Abell, it is good to see you again. I want
to sincerely thank you and Mr. Nesterczuk for your efforts in
developing a new personnel system for the Department of
Defense.
And, Mr. Walker, it is good to have you with us again. GAO
has had a great deal of experience in developing and reporting
on best practices and implementing new personnel flexibilities,
and I truly value your input.
Undersecretary Abell and Mr. Nesterczuk, George Washington
said, ``The willingness with which our young people are likely
to serve in any war, no matter how justified, shall be directly
proportional to how they perceive the veterans of earlier wars
were treated and appreciated by their Nation.''
This is especially true for veterans preference in Federal
employment. However, DOD's proposed regulations do not
guarantee veterans preference rights in regard to the bump and
retreat options that preference-eligible employees have.
Is it DOD's intent to circumvent veterans preference under
bump and retreat by offering temporary employment that is not
guaranteed and not an appropriate intermediate step before
subjecting a veteran to separation through a reduction in
force?
Mr. Nesterczuk. Senator, the veterans preference was always
foremost in our minds in the staffing area, both on RIF and on
the intake side in the hiring flexibilities we provided, where
veterans preference has been fully protected. There are no
changes to that.
On the RIF side, we also make no changes to the
hierarchical retention of veterans in a reduction in force.
They get exactly the same protections that they currently do.
The one change that we have implemented or are proposing to
implement is to build the retention registers within each of
these categories, veterans preference eligibles, the disabled
veterans, and the nonveterans, within each of those categories,
retention lists would be done on the basis of performance first
and then seniority within the performance groupings. That is
the one change.
But otherwise the veterans protections are the same.
Senator Akaka. Thank you.
Mr. Nesterczuk, Congress intended OPM to be a full partner
in the development and implementation of the NSPS. However, the
regulations state that OPM may review and comment on proposed
DOD implementing issuances, but that in cases where the
Director of OPM does not concur with the proposed action of
DOD, the Department may implement it anyway.
What recourse does the Director of OPM have in cases where
OPM does not concur with the actions of the DOD?
Mr. Nesterczuk. On implementing issuances, we have
permitted the Department a great deal of flexibility so that
they can tailor the issuances to the various structures and
organizational components of DOD. DOD is a complex
organization.
That is why we consciously regulated, in the areas of pay
and performance, at the level of enabling regulations, to give
DOD those flexibilities. We will be maintaining oversight on a
regular basis. We do on a government-wide basis and NSPS is not
precluded from the same oversight in the future.
So we will be working with DOD in its application of its
internal regulations to make sure that they comport with
government-wide standards and the mission requirements of the
Department. We do not anticipate any difficulties, as there is
nothing here that we do not currently deal with in civil
service.
Senator Akaka. Mr. Walker, the proposed regulations allow
pay pool managers to make final decisions for performance pay
allocations, but there is no process to challenge this
decision. What is your opinion of the lack of appeals? And what
does GAO do to ensure fairness and transparency in the
allocation of performance awards?
Mr. Walker. First, I think any system that provides for
additional flexibility has got to have adequate safeguards to
prevent abuse. I think part of that includes having a
reasonable degree of transparency with regard to the results of
key decisions, whether it be pay, whether it be promotions or
other types of actions, while protecting personal privacy.
Another aspect of it is to be able to have both informal
and formal appeal mechanisms within the organization and
outside the organization if individuals feel that there has
been an abuse or a violation of the policies and procedures or
otherwise the protected rights of the individual.
I believe that it's important, when you are talking about
performance management, that you not just have the supervisor
dealing with it. You have to have a reviewer look at it. You
also have to have other institutional mechanisms within the
department or agency. For example, the Human Capital Office,
which is not a line organization, is a supplement, not a
substitute, for the line, the Office of Opportunity and
Inclusiveness, to be able to look to try to provide reasonable
assurance that there has been consistency and
nondiscrimination.
And then in the end, to have reasonable transparency and
appropriate appeal rights if people believe they have been
aggrieved in some way.
Mr. Nesterczuk. Can I add to that? Because it is an
important consideration for us, too, transparency and making
sure that there is a sense of fairness and employee buy-in. If
employees do not think that it is fair, they are not going to
buy in, particularly in the performance appraisal area. They
have to buy in.
We did build in an appeal process. There is a built-in
administrative review, a departmental review, proposed. That is
something that we are willing to flesh out in the course of
meet and confer. If that is not sufficiently credible, we are
willing to talk about that. But the idea is to have an appeal
process in there, a review process, that lends credibility to
the system.
Senator Akaka. Thank you very much, Mr. Chairman.
Senator Voinovich. Senator Coburn.
Senator Coburn. Thank you, Mr. Chairman.
My questions really go back to what you have been talking
about, and I would ask the Secretary and Mr. Nesterczuk to just
outline--the whole basis for controversy over this is the lack
of confidence that it is going to be handed out fairly, that it
is trustworthy, that there will not be individual bias in the
management above somebody, that they will use something other
than a standard of performance and work to measure somebody's
performance in the long run, which, i.e., will become their
basis for earning a living--outline for me, both in a positive
sense and a negative sense, the steps that are in the
implementation of this that will assure the employees of DOD
that you are going to build the confidence into the system, so
that they know that their questions and their openness to abuse
is going to be answered.
I would like for you to just detail that. I think that will
give us--and thinking, put their hat on for a minute, and if
you were in that position, what would you like to see in terms
of fairness. And I would like for you just to summarize
quickly, if you would. I will not have any other question. Here
are the positive things that we are doing to assure that. Here
are the penalties if somebody violates that. In other words,
just go through it, if you would, in a systematic fashion, to
list both the positive and negative incentives that are in this
system that will assure people who work for DOD that they are
going to have a fair system.
Mr. Abell. I will start, sir, and then I will defer to my
colleague.
This whole system, as many have said, is predicated on
being credible and being respected. And we will demonstrate,
through communications, and our actions, and our regulations,
to the workforce that all the safeguards that they would want
are there. They are going to participate in the training. They
are going to participate in the setting of their goals, their
performance standards, and they will participate in the
quarterly or semi-annual evaluations with their supervisors.
The supervisor's decision is not one of total discretion.
It is reviewed by a board of the supervisor's peers. The
supervisor's pay raises are contingent upon the success of the
work unit and not his personal production or performance, so it
is the supervisor's incentive to have his work unit do well.
Thus, he would be incentivized to reward those who perform. And
the overriding thing I think is that the Department of Defense
is an institution that values, cherishes, demands success, and
success only comes from a cohesive workforce. So those are the
positives.
The negative incentives, if you will, there will be, there
is, accountability at all levels. Our commanders watch our
supervisors. Our supervisors watch those managers below them.
It is an open process. It is transparent. There are avenues for
those who feel they have not been treated fairly, and our union
partners are, also, watching, helping us identify areas where
we need to do better.
Mr. Nesterczuk. Although the proposal for the NSPS is a new
personnel system, and there is a lot of newness about it in the
pay-for-performance system and some of the classification
system changes. Yet from an employee's perspective, their
rights, their rights to contest any of the processes or
procedures really don't change. The prohibited personnel
practices have not changed. So, if there are any decisions that
are arrived at in the course of NSPS on pay, on performance, on
adverse actions that an employee feels are not fair or not
right, whether it is nepotism, favoritism, political
performance, whatever, none of those have changed.
So the safety net, from an employee's standpoint, is that
the avenues for appeal are still the same, and those are
familiar to them.
Senator Coburn. So that means, if I am an employee at DOD,
and I outperform and I produce, I am going to make more?
Mr. Nesterczuk. Yes.
Senator Coburn. I am going to hold you all to that because
that is the only way this works for those employees. You cannot
say here is the carrot and not give the carrot.
Mr. Walker.
Mr. Walker. Senator, a couple of comments.
First, if the system is not credible, it won't be
effective. You have properly pointed out the need to balance
flexibility with safeguards to prevent abuse.
The other thing I think we have to keep in mind is there is
nothing probably more complex and controversial in the human
capital area as classification and compensation issues. These
are the closest to the bone you are ever going to get in any
organization. We have to keep in mind where we are coming from
as well.
Right now, we have an overly complex, very hierarchical
classification system that also includes compensation ranges
that, in many cases, are not reflective of the current market.
Second, we have a system whereby, for a typical Executive
Branch agency, 85 percent-plus of the pay raises have nothing
to do with skills, knowledge, and performance.
They are on autopilot. So, by definition, that means to the
extent that you end up moving to a system that is more market
based and performance oriented, that is a huge change. And to
the extent that it involves more management discretion and more
meaningful performance appraisal systems, there is
understandable apprehension. If there is not trust in
management, if there is not an understanding of the system, if
there are not adequate safeguards and transparency mechanisms,
you are going to have big problems.
They are at the beginning of a long road, and one of the
things that has to happen is for the meet-and-confer process to
be meaningful, for a lot of these details to be worked out
because these details do matter. DOD needs to continue to take
this in a phased approach, learning as they go along to be able
to continuously improve as they move forward.
Senator Coburn. Thank you, Mr. Chairman.
Senator Voinovich. Senator Levin.
OPENING STATEMENT OF SENATOR LEVIN
Senator Levin. Thank you, Mr. Chairman.
I would like to go right to that issue of employee
confidence, credibility, acceptance, and apprehension. Before
you have even gotten to the proposal in the draft regulation
before us, we have a pay-for-performance issue which is very
current.
We have a law that says that performance has got to be the
basis for pay increases, and yet on July 12 of this year the
director of administration and management, in the Office of the
Secretary of Defense, directed across-the-board pay raises of
2.5 percent, which is the maximum increase allowable for senior
executives who are political appointees. For nonpolitical
senior executives who got the same performance rating, they get
a 2-percent pay increase.
Now, on February 4, Senators Warner, Collins, Lieberman,
and I wrote Secretary Rumsfeld, pointing out that the decision
to use the career or noncareer status of an employee as a
factor in the awarding of a pay raise is inconsistent with the
law and with the Department's stated intent to pay employees on
the basis of performance. We asked the Secretary to take
appropriate steps to ensure that the pay raise for DOD senior
executives is implemented in a manner that is consistent with
the requirement of law and policy, but the Department has not
yet taken those steps.
So, Mr. Abell, are you going to take those steps or not?
Mr. Abell. Senator, we are going to take those steps. It is
prospective at this point. We have a performance plan that is
currently with our colleagues at OPM, SES performance plan with
OPM, that will comport with the spirit and intent of the law
for performance management for our Senior Executive Service
going forward. We anticipate that we----
Senator Levin. ``Going forward'' is not enough. We have a
law that is in place now----
Mr. Abell. Yes, sir.
Senator Levin [continuing]. For current pay increases. Why
is that law not being abided by? And why would employees have
confidence in the future in your pay-for-performance proposal,
when you have got a law now that says performance has got to be
the basis for pay increases, but you have a 2.5-percent across
the board for political senior executives and 2 percent for
nonpolitical senior executives. Why does that engender
confidence, and why is it legal?
In other words, not just promises about what you are going
to do in the future. You have got an existing law, why is that
not being abided by? Why are not this year's pay increases
based on that law and on the same premise and principle that
you just laid out for the future?
Mr. Abell. The January sequence of events, the performance
evaluation was based on a legacy system, an old system, that
was, essentially, a pass/fail system--is, essentially, a pass/
fail system. The DOD general counsel has reviewed the actions
that were reported in the letter from the director of
Administration and Management and has opined that they were
legal. I am not a lawyer. I do not practice law in the
Department of Defense, so I leave that to the general counsel,
but that is a report from there.
Senator Levin. Putting aside the law, is it a coincidence
that every political appointee gets a 2.5-percent increase and
the nonpolitical appointees get 2 percent? Is that a
coincidence for the same performance improvements?
Mr. Abell. Sir, as I recall, the director of Administration
and Management letter, the noncareer folks could fall into a
category of 2.5, 2.3, or 2--I am recalling that off the top of
my head--depending, again, on how their performance was rated.
The noncareer folks were rated as well. Their performance
was evaluated, although not in the same system as the career
SES, and that was the basis for those decisions.
Senator Levin. Are you saying there was individualized
appraisal of the noncareer employees? Mr. Abell, you are
proposing a system here which is based on an important premise.
You are not living by that premise right now, despite the law's
requirement that you abide by the pay-for-performance rule now.
There are a lot of other issues that these regulations
raise, and my time is almost up, but I have to tell you it goes
right to the heart of questions which have been raised here--
pay-for-performance. You are not abiding by the current law.
Why would people have confidence that the discretion which is
being given is going to be used fairly, when it is not being
used fairly right now under current law? It is not being used
individually. It is a pattern. It is based on your political or
nonpolitical appointment status.
I think, and this is a letter which the Chairman of this
Subcommittee, the Ranking Member of this Subcommittee, Senator
Warner and I have raised with the Department. It seems to me we
are entitled, and more importantly the people of the United
States and the employees are entitled to an answer on a very
fundamental question which has been raised by this letter. And
it is not good enough to simply say the lawyers have approved
it.
I hope you would reconsider it because it goes to the heart
of what you are proposing here.
My time is up, Mr. Chairman, unless he wants an opportunity
to respond.
Mr. Abell. Senator, I understand. I will report your
concern about not responding to the letter. I am sure the
Secretary will give you a comprehensive response.
Senator Levin. Thank you.
Mr. Walker. Senator Levin, we have not been asked to look
at this issue from a legal standpoint, but as you know,
yourself and others being lawyers, the law represents the
minimum standard for acceptable behavior. You do not want to
just do what is arguably legal, you want to do what is right,
and, hopefully, you will get a response.
Senator Voinovich. Senator Pryor.
OPENING STATEMENT OF SENATOR PRYOR
Senator Pryor. Thank you, Mr. Chairman.
Mr. Walker, I want to ask you just a big-picture question.
And that is, in the 107th Congress, we acted to create a new
personnel system for the Department of Homeland Security, and
that was created through legislation. Last year, Congress
passed legislation that allowed fairly significant changes in
the DOD personnel system. Are we getting to the point where it
no longer makes sense to go through this agency-by-agency, that
we ought to look more globally at our civil service system
across the board? I would like to hear your comments on that.
Mr. Walker. I do think that, ultimately, the Congress is
going to want to look at the entire civil service system
because what has happened over the years is that we now have a
situation where, through the individual initiatives of various
departments and agencies, and in the interest of full and fair
disclosure, including GAO, over 50 percent of the Federal
workforce is now covered by new systems, systems that provide
for broadbanding, that provide for more market-based and
performance-oriented compensation systems, that, also, provide
for certain other flexibilities.
I think over time we are going to need to try to make sure
that there is more consistency throughout the Federal
Government. By that I mean not that there should be one
broadbanding system or one pay-for-performance system, but that
these types of flexibilities apply broadly throughout
government. I think it is very important that we make sure that
certain values, certain principles, and certain safeguards
should apply throughout the Federal Government in order to
maximize the chance of success and minimize the possibility of
abuse.
Senator Pryor. So do you think we ought to continue going
agency-by-agency or even department-by-department or is it time
now to really look at the entire system collectively?
Mr. Walker. I think, at a minimum, you need to look at what
type of principles and safeguards should be in place throughout
the Federal Government. These can serve to provide the glue
that binds us together and can help to provide reasonable
assurance that any flexibilities that exist would be both
effective, credible, and nondiscriminatory.
Senator Pryor. Mr. Abell, in your opening statement you
said, ``We,'' meaning the Department of OPM, ``We take this
task seriously and recognize the responsibility we have to
balance our vital national security mission with protecting the
interests of the people.''
I am curious about that statement. Could you explain some
specific instances in the past where you believe the
``interests of the people'' have differed from the ``national
security mission'' of the Department.
Mr. Abell. Senator, as the many instances of testimony over
the proposal to approve the National Security Personnel System,
this type of question came up over and over again. And I think
the answer is that, moving forward, we do not want to do that.
We do not want to have one get out of balance with the other. I
do not think that implies that it is currently out of balance--
--
Senator Pryor. Or it has been out of balance in the past.
Mr. Abell. Or it has been out of balance. As I said earlier
to Senator Coburn, it is an organization that does succeed, the
Department of Defense is. Failure is not an option, and so our
employees, and our managers, and our commanders collaborate to
make sure that occurs.
Senator Pryor. Yes, I heard your answers to Senator
Coburn's questions, which I thought were very good questions.
Maybe I misunderstood that sentence or that phrase from your
opening statement, but I wanted to just clarify, for the
Subcommittee's purposes, that you are not saying that it has
been out of balance in the past.
Mr. Abell. No, sir, I am not implying that is a change.
Senator Pryor. Now, Mr. Abell, my understanding is that
performance expectations are not required to be put in writing;
is that right?
Mr. Abell. No, sir, that is not correct today, and it will
not be correct in the new one. Supervisors and employees will
sit down together. They will lay out at the beginning of a
performance cycle, an evaluation cycle, what the objectives
are, what the standards are. There will be periodic reviews
during that cycle, and then at the end of the cycle will be the
evaluation.
Senator Pryor. I am just asking how is that going to be
documented? Is all of this required to be in writing?
Mr. Abell. Yes, sir. There will be instances during the
evaluation period where changes occur, as mission changes, as
production needs change. It depends on the organization. Not
all of those may be necessarily in writing, but the initial one
certainly would.
Senator Pryor. Well, my experience in matters relating to
personnel in my private law practice or as the attorney general
of my State, is that it is important to be consistent. And you
are probably much better off in the long term to take the time
to get as much in writing as possible because people's memories
get hazy over time, and they have different understandings of
what was said or what was implied. So I would think that the
Department needs to try to make sure they have a good, concise
way to document this, otherwise I think you are asking for
trouble.
Thank you, Mr. Chairman.
Senator Voinovich. Thank you, Senator Pryor.
I am going to have a short 2-minute question period.
I hope that you are tracking what the Department of
Homeland Security is doing in designing their personnel system.
Please clarify for me why some aspects of the NSPS rules will
be different from those at the Department of Security. For
example, the Homeland Security Labor Relations Board has a
process for participation by the unions in selecting the
members of the Board. From my pespective, the Defense
Department needs a good reason for differences between its
personnel system.
The other question I have concerns certification of NSPS.
For more than 300,000 employees to be covered by NSPS it has to
be certified. Who is going to certify the system. Is that the
Office of Personnel Management, Mr. Nesterczuk?
Mr. Nesterczuk. We have talked to the Department about
that. We will set up some evaluation criteria. The PEO is in
the process of doing that, setting up an evaluation program as
part of the implementation. We will work with them on that, and
we will help them achieve that certification.
Senator Voinovich. I am going to be very interested in
making sure that process--I want to understand what it is, I
want to know what the metrics are and so on because 300,000 is
a lot of people, but at least we have got an opportunity then
to go back and review how the system has worked.
Senator Levin. Thank you, Mr. Chairman.
Mr. Abell, as you know from your past experience, the
Senate Armed Services Committee has had a lot of dealings with
a broad range of actions that are taken in personnel actions
involving military personnel. These issues come up in the
context of confirmation hearings for senior officers, and we
see cases that range from misuse of government property, abuse
of authority, to drunken driving, to retaliation against
whistleblowers. Nonetheless, even in those cases where there
are shortfalls, human failings, we have officers that are
recommended for promotion and, as far as I am concerned,
rightly so.
I do not need to tell you, because of your experience, just
how many letters we get from the Department that will identify
an offense committed by a nominee, but reach a conclusion that
it was an isolated incident in that officer's career, and it
should not preclude promotion to a higher rank. But the draft
regulation provides that a proposed penalty against a DOD
civilian employee may not be reduced on appeal unless ``the
penalty is so disproportionate to the basis for the action as
to be wholly without justification.''
And even in those cases where the penalty is reduced, the
draft regulation states that ``the maximum justifiable penalty
must be applied.''
That is pretty draconian, and it is not consistent with the
promotion policy for our uniformed military officers. For
instance, the draft regulation does not even allow the
reviewing authorities to take into account a lot of factors
that could reduce the penalty, such as the employee's past
record, whether the offense was intentional or inadvertent,
consistency of the penalty with those imposed on other
employees for the same or similar offenses. Instead, it just
simply says that the MSPB--the Appeal Board--should apply ``the
maximum justifiable penalty.''
Now, would it not make more sense to recognize, in the case
of DOD, civilian employees, as we do for senior military
officers, that there is a whole range of penalties that may be
appropriate for a given offense, depending on its context? And
should not the regulations reflect the full range of factors
that could be considered in determining an appropriate remedy?
Mr. Abell. Sir, I believe that you are referring to what
prerogatives accrue to an administrative judge who is reviewing
an appeal, MSPB administrative judge. And it is true that the
proposed regulations would limit the administrative judge's
ability to mitigate the punishment. He may--he or she--may
recommend mitigation back to the Secretary of Defense, but does
not have, under our proposed regulations, the ability to direct
that mitigation.
I think that is entirely consistent with the military side
that you described in that the military side is done solely
within the Department of Defense. All of those same leaders and
those same concerns for due process exist prior to the case
getting to the administrative judge, and then the
administrative judge sends back his findings to the Secretary,
who again can review it and take one of three actions, as I
understand it.
Senator Levin. Is the DOD allowed to consider those factors
or must the maximum justifiable penalty be applied? This is not
a question of whether it is a recommendation or not. This is a
question of whether or not the maximum justifiable penalty has
to be applied or whether you can take into consideration,
whoever makes that final decision, the full range of factors
which are normally considered in employment cases, whether it
is promotion or punishment.
Mr. Abell. Senator, my understanding of the regs is that
they are not intended to direct a supervisor, manager or
commander to employ the maximum penalty possible. If it says
that, we will review it and look at it.
Senator Levin. But the MSPB, on its decision, must do that.
Mr. Abell. Yes, sir. The ability of the MSPB to change the
finding of the leadership of the Department of Defense from the
individual through the Secretary is limited, and that is to
consider the national security mission and the impact on the
national security mission, but that does not imply that the
line of supervision from the individual through the Secretary
is somehow limited.
Mr. Nesterczuk. Let me make a comment here, if I may,
Senator, since we had some input on this as well.
Our concern was that the statute permits the Department to
establish new standards in the area of appealing decisions. The
reason is there are many instances of AJs second-guessing
first-line managers who make a penalty decision in the context
of mission, in the context of operational requirements.
Managers are subsequently second-guessed in an entirely
different context, may be based on the AJ's experience with an
agency with a less-vital mission, where a similar transgression
could call for a less-severe penalty.
So this is an attempt to give more weight to the mission
requirements of the Department, the operational needs of the
Department, in achieving----
Senator Levin. You can give presumptive weight. You do not
have to direct that an appeal body apply the maximum
justifiable penalty. You can give a presumption to a decision
without being this inflexible, rigid and draconian on the
appeal of that decision.
Thank you, Mr. Chairman.
Senator Voinovich. Senator Akaka.
Senator Akaka. Senator Pryor can go first.
Senator Voinovich. Any other questions, Senator Pryor?
Senator Pryor. No questions.
Senator Voinovich. Senator Akaka.
Senator Akaka. Thank you very much, Mr. Chairman.
Following on Senator Voinovich's question, and this is to
Undersecretary Abell, the proposed regulations state that the
internal National Security Labor Relations Board will
consistent of members selected by the Secretary, except for one
appointed by the Secretary upon consultation with OPM.
Why have Federal employees been left out of this process?
Mr. Abell. Senator, there are a number of ways that we
could have done this. As Senator Voinovich points out, DHS used
a different model. This is something that we can, and will,
review during the meet-and-confer process, but this is the
model that we selected to put in our proposed regulations.
Senator Akaka. Undersecretary Abell, the regulations state
that DOD will issue implementing issuances on premium pay and
compensatory time, including compensatory time off for travel.
As author of the new governmentwide compensatory time for
travel provision, I am interested in learning what changes DOD
plans to make to this provision, and what are some changes
being considered to the compensatory time for travel provisions
of Title 5?
Mr. Abell. Senator, I do not know that we have any changes
to that in mind at this point.
Senator Akaka. Let me, also, follow up on the line of
questioning of Senator Levin. Could you provide us with
examples of AJs disregarding agency mission.
Mr. Abell. Yes, sir. I have several here if you would like
them or I can give them to you for the record, whichever way
you choose.
Senator Akaka. Thank you very much. For the record is fine.
, Mr. Chairman, my time has expired.
Senator Voinovich. Obviously, there are a lot more
questions. We will submit them for the record and give you an
opportunity to answer them.
We thank you very much for the work that you have put into
this. Mr. Walker, thank you for staying on top of this whole
area. We hope that the period that the meet and confer process
will be fruitful. I am glad, Mr. Abell, you said that you would
be willing to extend it beyond the minimum 30 day requirement,
as was the case with the Department of Homeland Security. It is
really important that the regulations be vetted and everybody
feels that they have had an opportunity to discuss concerns. So
I hope you remain committed because I think the commitment of
senior leadership will determine whether or not NSPS is going
to be successful.
Thanks very much.
Mr. Walker. Thank you, Senator.
Senator Voinovich. Testifying in our second panel is
Richard Oppedisano, the National Secretary of the Federal
Managers Association. Testifying on behalf of the United DOD
Workers Coalition are John Gage, President of the American
Federation of Government Employees, and Gregory Junemann,
President of the International Federation of Professional and
Technical Engineers.
Thank you for coming. I know that all of you have invested
much time and energy on this issue. I also know that you have
many concerns, and I look forward to your testimony.
If you will all stand, I will swear you in.
[Witnesses sworn en masse.]
The record will indicate that the witnesses answered in the
affirmative.
We will begin with Mr. Oppedisano.
TESTIMONY OF RICHARD OPPEDISANO,\1\ NATIONAL SECRETARY, FEDERAL
MANAGERS ASSOCIATION
Mr. Oppedisano. Thank you, Mr. Chairman.
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\1\ The prepared statement of Mr. Oppedisano appears in the
Appendix on page 106.
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Chairman Voinovich, Ranking Member Akaka, and Members of
the Subcommittee, I sit before you today as the National
Secretary of the Federal Managers Association, FMA. I was
recently retired as the chief of staff and the operations
officer for the U.S. Army Watervliet Arsenal in Watervliet, New
York. I have been involved in human resource management and
labor relations for the better part of my 30 years of Federal
civil service before retiring last May. On behalf of the nearly
200,000 managers, supervisors, and executives in the Federal
Government whose interests are represented by FMA, I would like
to thank you for allowing us to express our views regarding the
proposed personnel regulations outlining the National Security
Personnel System, NSPS, at the Department of Defense.
Managers and supervisors are in a unique position under the
final regulations. Not only will they be responsible for the
implementation of the Department's new personnel system, but
they will also be subjected to its requirements. As such,
managers and supervisors are pivotal to ensuring the success of
the new system. We, at FMA, recognize that change does not
happen overnight. We remain optimistic that the new personnel
system may help bring together the mission and goals of the
Department with on-the-ground functions of the civilian DOD
workforce.
The proposed rules that were provided in the Federal
Register were not all-inclusive. The proposal indicates that
detailed instructions will be provided in DOD's implementing
regulations. Without these detailed regulations, it is
difficult to have a complete understanding of the regulatory
requirements. Therefore, we recommend that the implementing
regulations be made available for review and comment prior to
being issued as final.
Two of the most important components to implementing a
successful new personnel system are training and funding.
Managers and employees need to see leadership, from the
Secretary on down, that supports an intensive training program
and budget proposals that will lend credibility to the intent
of the new personnel system. We, also, need the consistent
oversight and appropriations of proper funding levels from
Congress to ensure that both employees and managers receive
sufficient training in order to do their jobs most effectively.
As any Federal employee knows, the first item to be cut
when budgets are tightened is training. Mr. Chairman, you have
been stalwart in your efforts to highlight the importance of
training across government. It is critical that this happens in
the implementation of these regulations. Training of managers
and employees on their rights, responsibilities and
expectations, through a corroborative and transparent process,
will help to allay concerns and create an environment focused
on the mission at hand.
Managers have often been given additional authority under
the final regulations in the area of performance review and
pay-for-performance. We must keep in mind that managers will,
also, be reviewed on their performance and, hopefully,
compensated accordingly. As a consequence, if there is not a
proper training system in place and budgets that allow for
adequate funding, the system is doomed to failure from the
start.
Our message is this, as managers and supervisors cannot do
this alone, cooperation between management employees must be
encouraged in order to debunk myths and create a performance
and a results-oriented culture that is so desired by these
final regulations. Managers have also been given greater
authority in the performance review process that more directly
links employees' pay to their performance. We believe that
transparency leads to transportability, as interdepartment drop
transfers could be complicated by the lack of a consistent and
uniform methodology for performance reviews.
FMA supports an open and fair labor relations process that
protects the rights of the employees and creates a work
environment that allows employees and managers to do their jobs
without fear of retaliation or abuse. The new system has
regulated the authority for determining collective bargaining
rights to the Secretary. Toward this end, the recognition of
management organizations, such as FMA, is a fundamental part of
maintaining a cooperative and congenial work environment. Title
5 CFR 251 and 252 allows FMA, as an example, to come to the
table with DOD leadership and discuss issues that affect
managers and supervisors. While this process is not binding
arbitration, the ability for managers and supervisors to have a
voice in the policy development within the Department is
critical to its long-term vitality.
There has also been a commitment on the part of OPM, DOD
and DHS to hold close to merit systems principles, and we
cannot stress adherence to these timely standards enough.
However, we also believe that there is a need to be additional
guiding principles that link all organizations of the Federal
Government within a framework of a unique and a single civil
service. OPM should take the current systems being implemented
at DOD and DHS and create a set of public principles that can
be guided for all other agencies and their efforts to develop
new systems--systems that parallel one another to allow for
cross-agency mobility and evaluation instead of disjointed ones
that become runaway trains.
We, at FMA, are cautiously optimistic that the new
personnel system at DOD will be as dynamic, flexible and
responsive to modern threats as it needs to be. While we remain
concerned with some areas at the dawn of the systems roll-out,
the willingness of OPM and DOD to reach out to employee
organizations such a FMA is a positive indicator of cooperation
and transparency.
We look forward to continuing to work closely with the
Department and Agency officials. Thank you, again, Mr.
Chairman, for the opportunity to testify before your
Subcommittee and for your time and attention to this important
matter. Should you need additional feedback or have any
questions, we will be glad to offer our assistance.
Senator Voinovich. Thank you very much. Mr. Gage, welcome
back. It is nice to see you, again. I compliment you on
developing a union coalition, on whose behalf you are
testifying today. I understand there are 27 unions in the
coalition?
Mr. Gage. I think there are 36 unions.
Senator Voinovich. I stand corrected. I thought that I had
a lot when I was mayor of Cleveland. We had 27.
Mr. Gage. That does not make it easier. That is for sure.
Senator Voinovich. We look forward to your testimony.
TESTIMONY OF JOHN GAGE,\1\ PRESIDENT, AMERICAN FEDERATION OF
GOVERNMENT EMPLOYEES
Mr. Gage. Thank you, Mr. Chairman and Members of the
Subcommittee.
---------------------------------------------------------------------------
\1\ The prepared statement of Mr. Gage appears in the Appendix on
page 126.
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I want to focus my remarks on the broad outline of a pay-
for-performance scheme that was included in the proposed NSPS
regulations. Our unions' objections are detailed in our written
testimony and formal comments in response to the February 14,
2005 Federal Register notice.
Today, I want to emphasize that DOD's proposed pay system
is nothing more than an elaborate and costly mechanism to
reduce salaries and salary growth for the vast majority of DOD
workers. It is interesting to note that in response to the
outpouring of workforce opposition to NSPS, DOD has launched an
effort to convince its employees that they will do better under
the new system. They are trying to sell it as market-sensitive
pay rather than performance pay. But our members seem to know
that no matter what name is attached, the NSPS is no more about
market sensitivity than it is about performance. It is not
about improving their pay.
After all, the general schedule and locality pay component
are both supposed to be market-based system. The GS is supposed
to combine periodic performance-based raises called within-
grade increases with market-based adjustments to the entire
schedule. FEPCA's locality raises are, also, supposed to be
entirely market-based. Likewise, blue-collar Federal employees
are supposed to receive market-based prevailing rates, but
neither the GS nor the blue collar FWS system ever actually
uses the market data because of budget constraints.
DOD's scheme, whether it is market sensitive or market
based, does not even promise market rates on paper. Instead, it
admits that budget neutrality will be the primary principle
guiding pay raises. Despite the fact that DOD has not revealed
anything close to the detail necessary to evaluate its plan
properly, we know enough to be strongly opposed to it as both a
tremendous waste of time and money and a guaranteed way to
introduce corruption, cronyism and chaos into a workplace that
should be focused on national security and troop support.
First, no one whose performance is judged fully
satisfactory will receive any raise at all unless DOD decides
to adjust the bottom-most level of his or her pay bands. DOD
will be able to use any one of numerous factors to justify a
decision not to raise the bottom of the pay band, factors that
will include, but not be limited to, its own interpretation of
data it buys from consultants. One year it might refuse to
adjust the bottom because its consultants say it is not
necessary. Another year it might refuse to adjust the bottom
because it is not recruiting at the entry level and, thus,
there is no need to make any adjustment. Any reason will do.
But in the meantime, when entry rate is frozen, every other
rate in the band will be frozen as well. And it is my suspicion
that the market rate will be used to lower entry rates rather
than to raise them. Movement within a band, a so-called
performance raise, will be worth less and less in terms of
purchasing power if the rates are not adjusted due to a freeze
on the entry level.
These performance raises will also be a moving target. Even
if your supervisor recommends you for a raise based on your
performance, you end up competing against everyone else whose
name is placed in that performance pay pool. Whether you are a
winner or a loser in that contest has nothing to do with
performance. It will be all about which component is a priority
that year, and there will be no uniformity regarding the size
of a performance raise. An employee rated outstanding in one
place may get 2 percent, while another working elsewhere, with
the identical job and an identical outstanding rating, might
receive 1 percent or nothing at all.
An individual's performance rating in the DOD scheme will
be a crucial factor in deciding salary level, salary
adjustments and vulnerability to reduction in force. However,
in the proposed regulations, these evaluations will not be
subject to challenge through the union's negotiated grievance
and arbitration process. This last is perhaps the system's
fatal flaw. DOD management has decided to base the two most
critical aspects of an employee's job--his pay and whether he
keeps his job in the face of RIFs--on his performance
evaluation. Yet it is not willing to allow those evaluations to
be held up to scrutiny by an impartial third party. It is not
willing to require that the documentation justifying a
performance evaluation be made available to the employee and
not willing to let the employee have a real opportunity to
challenge the evaluation. This absence of accountability on the
very mechanism that DOD intends to place at the heart of its
new personnel system makes a mockery of its promise to uphold
the merit system principles and is simply not credible.
If employees cannot appeal performance ratings to an
impartial third party, how will they or the public know that
salaries in the Defense Department are based upon factors other
than politics? If employees cannot appeal performance ratings
to an impartial third party, how will they or the public know
that getting or keeping a job in the Defense Department is
based upon who you know, rather than what you know. There will
be no way to verify this. The hubris on the part of the DOD
will doom its system. The only question is how much damage will
be done before the scandals amount to such a level that
Congress is forced to enact new legislation that constrains the
power of the Agency to act without accountability to any
outside authority.
Pay-for-performance schemes, even those not plagued with
the DOD's fatal flaws, have never been shown to deliver
improved performance in either the public or the private
sector. Indeed, they do not improve performance of either
individual workers or organizations. And unless substantial
additional resources are made available to fund pay-for-
performance, these schemes inevitably end up lowering pay for
the majority of workers and diverting enormous resources to
bureaucracies rather than mission.
Professor Jeffrey Pfeffer of Stanford University's School
of Business summed up the research on pay-for-performance by
saying that it eats up enormous amounts of managerial resources
and makes everyone unhappy. Thank you, Senator.
Senator Voinovich. Thank you, Mr. Gage. Mr. Junemann.
TESTIMONY OF GREGORY J. JUNEMANN,\1\ PRESIDENT, INTERNATIONAL
FEDERATION OF PROFESSIONAL AND TECHNICAL ENGINEERS
Mr. Junemann. Thank you, Mr. Chairman. I would like to
thank the Subcommittee of the Oversight of Government
Management, the Federal Workforce and the District of Columbia
for holding today's hearing. I would also like to extend a
special note of appreciation to Chairman Voinovich and Ranking
Member Akaka for giving me the opportunity to testify here.
---------------------------------------------------------------------------
\1\ The prepared statement of Mr. Junemann appears in the Appendix
on page 140.
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Before I begin my personal remarks, I would like to join my
good friend John Gage in submitting the official record of the
comments of the United DOD Workers Coalition, the UDWC, of
which IFPTE is a member. The document represents the official
testimony of the UDWC, a coalition of 36 unions working
together on this NSPS issue. I would like to directly associate
myself with the UDWC document, which was delivered to this
Subcommittee last week.
Although I would be happy to engage in discussion on pay-
for-performance, I will restrict my remarks to the Department's
regulation subparts on appeals and labor relations. The
features of these two sections are critically important if we
want to preserve fairness and equity for the civilian workforce
of the Department of Defense and the accountability of
management. The Department has insisted that it requires
flexibility in its personnel system, and this is necessary to
better our Nation's security. But so far we have seen no
evidence that this system, despite its title, was developed
with our national security in mind.
DOD states that the current appellate system is complex,
legalistic and slow. But gutting the current personnel system
and effectively starting over simply will not work.
First, it strikes at the heart of a system of justice that
is crucial to assuring employees that they work in an
environment where their side of the story can be heard and not
ignored.
Second, in some ways, it will not streamline the system,
but will make it more complex.
Finally, it will push good employees out of government
service and discourage qualified employees from applying.
At every juncture in these regulations, the Department is
seeking to avoid being held to any objective standards. Even
third parties, like the Merit System Protections Board, are
required to afford DOD great deference in interpretation of
these regulations. This creates an entirely new legal standard
which an established body of law, under MSPB, already exists
and is yet another loophole for managers to escape
accountability for their actions.
DOD has not even provided evidence as to why MSPB's
authority to provide impartial review should be usurped. We do
not think it is required to protect our Nation's security
since, under the current personnel system, separation or
removal already may be effective rapidly, if in the interests
of national security.
Finally, DOD claims that the complexity of the existing
system deters managers from taking the necessary action against
poor performers and those engaged in misconduct. We have long
maintained that the proper training and resource management
within the existing personnel system would allow managers to
maintain discipline, ensure efficiency and good performance,
while maintaining fairness and esprit de corps within the
workforce. Certainly, it would be cheaper than creating an
entirely new and untested system.
As to the issue of labor relations provisions the goal of
the Department says it seeks to accomplish may be achieved, as
it has always been, by the continued adherence to the
provisions of Chapter 71 of Title 5. The Department has not
pointed to a single instance in which the Department has ever
failed to carry out its mission swiftly and authoritatively due
to the existence of Chapter 71 requirement.
Congress provided the Department with new tools to increase
efficiency, bargaining above the level of bargaining unit
recognition and new, independent third-party review of
decisions. The Department needs only to use these new tools
properly and train managers and supervisors properly to use the
authority that the current law provides.
Despite the plain meaning of the statute, the Department is
attempting to eradicate existing labor law protections. Again,
the sole purpose appears to be avoid accountability not to
protect national security. The regulations drastically limit
the subjects of bargaining, expand management's right to act
unilaterally and to restrict and/or eliminate the rights of
employees.
By far, the most outrageous feature of Subpart 1 of the
regulations is the creation of what can only be described as a
kangaroo labor board, the National Security Labor Relations
Board. Board members are to be appointed by the Secretary and
will essentially replace the Federal Labor Relations Authority,
which just celebrated 25 years of success in the Federal labor
relations business.
In conclusion, every successful civil service system
ensures a few basic critical concepts--flexibility, yes, but
also fairness, consistency, and accountability. The Department
has taken a straightforward mandate from Congress and abused
it. It has reserved for itself a great deal of flexibility
while shedding accountability and fairness.
We strongly urge Congress to step in. Any new personnel
system should preserve, at the very least, the following
attributes:
It should provide, as does the current system, for a choice
between Merit Systems Protection Board and negotiated
grievance/arbitration procedures for all serious adverse
actions.
It should provide impartial review of labor relations
disputes by an independent entity like the Federal Labor
Relations Authority. We recommend that the FLRA's current role
be preserved in its entirety.
It should, as the law requires, protect the due process
rights of employees and provide them with fair treatment.
Employees must have the right to a full and fair hearing of
adverse actions appeals before an impartial and independent
decisionmaker, such as an arbitrator or MSPB.
DOD should be required to prove, by the preponderance of
evidence, that adverse actions imposed against employees
promote the efficiency of the service.
An impartial and independent decisionmaker must have the
authority to mitigate excessive penalties.
This concludes my remarks, Mr. Chairman, and again thank
you.
Senator Voinovich. I would like to thank the panel for your
testimony.
Senator Warner. Mr. Chairman, would you indulge me, I have
a remark or two?
Senator Voinovich. Senator Warner, of course, I will.
OPENING STATEMENT OF SENATOR WARNER
Senator Warner. Thank you very much. I conducted a hearing
of the Armed Services Committee this morning, otherwise I would
have attended the session from the beginning.
Mr. Chairman and Members of the Subcommittee, I was
privileged to serve over 5 years, 4 months, and 3 days in the
Department of the Navy during some of the most intense years of
Vietnam, and I saw an almost seamless working relationship
between a civilian component of the Department of the Navy and
a uniform component of Naval and Marine Corps officer and men
and women. And it was magnificent in that very stressful and
difficult period in our history. And unlike other departments
and agencies of the Federal Government, there is an
extraordinary camaraderie between these two groups of
individuals.
And while I do not pretend to know all of the specifics of
this, I would urge that this Subcommittee and, indeed, the
Congress carefully evaluate the honest, forthright petitions
that have been presented to us this morning by both panels and
see whether or not we can reconcile the differences in such a
way as to even make a stronger team--and certainly I will speak
for the Department of Defense at this time--between the uniform
and civilian individuals.
I thank each of you for your contributions today.
I might add, at that time, I had over 600,000 in the
Department of the Navy, alone, of civilians, and many of them
were taking risks commensurate with the men and women of the
Armed Forces in the far-flung places of the world. I thank the
Chairman.
Senator Voinovich. Thank you, Senator Warner.
Mr. Gage, I heard your testimony with respect to
performance evaluations. You said that they do not make a
difference. From my own personal experience, performance
evaluations make a difference in the performance of employees.
I was mayor of the City of Cleveland for 10 years, and I was
governor of Ohio for 8 years, and I can assure you that it does
make a difference if undertaken in a proper way. I think that
Mr. Walker's testified that 85 percent of the employee pay
currently is on auto pilot.
For example, I will never forget having dinner one night
with one of our ambassadors. His wife and I talked about
Federal workforce issues. She told me that she had 15 workers.
She had five superperformers, five that were pretty good, and
five that are not performing. They all earned the same pay, and
she saw how it was demoralizing to the people that are doing a
better job.
Second, Mr. Oppedisano discussed training. I agree with
your concerns. I think you heard the question I asked of Mr.
Abell regarding the Department's budget for training. I would
like to hear your view of the Department's training budget.
Also, the Defense Department has operated alternative personnel
systems for 25 years.
Are you familiar with any of those, Mr. Oppedisano?
Mr. Oppedisano. You are probably referring to China Lake.
More than likely you are talking about the Naval China Lake
program.
As you stated before, sir, the monies that are going to be
necessary for training, we honestly feel that there should be
an appropriate line item for actual NSPS training. If it is
not, there is no guarantee that the individual installations
are going to receive the monies to be able to do the training
for their managers and their employees. And without that proper
training, there is no way that the system is going to be
successful. There is going to be no credibility on either side
of the aisle, without both of those parties sitting down
together and saying, ``OK. This is how we work it out.'' And
without the proper funding, it is not going to happen, sir.
Senator Voinovich. Do you believe that experts need to be
brought in to help with training should it be conducted in
house?
Mr. Oppedisano. My personal experience is with the
Department of Army right now. Over the past few years, since
1997 or so, we have been under the Civilian Personnel
Operations Center versus the Civilian Personnel Administrative
Center. And I do not believe, at the present time, within the
Department of Army at least, that there is enough sufficient
resources at the installation level that will be able to give
the training that is necessary.
They are going to go out, and they are going to say, ``OK.
We are going to train the trainers, and then go take it back to
the site, and then they are going to train at the site level.''
The credibility is not going to be there.
Senator Voinovich. In other words, the system right now is
in-house. You train the trainers, and then the trainers go back
and train the individuals to do performance evaluations.
Mr. Oppedisano. That is correct. Now, also, the fact that
they say the Human Resource Offices is the----
Senator Voinovich. Who is going to train the trainers?
Mr. Oppedisano. Well, that is the question. I do not have
an answer for you. I do not know. I do not think that has been
resolved yet, although, from what I am hearing, it is going to
come from the Civilian Personnel Operations Center for the
Department of Army folks.
So I am not sure whether that is finalized yet, Mr.
Chairman.
Senator Voinovich. Then it is unclear?
Mr. Oppedisano. I know there is going to be training. How
much, to what degree, and who is going to be involved has not
been specified yet, to my knowledge.
Senator Voinovich. Then your recommendation is for a
dedicated training line item in the budget? I have asked
agencies for this, for the last several years. I will never
forget when I first became a Senator, I asked all the
departments how much money they spent on training. I think 11
departments came back and said, ``We do not know what we spend
for training,'' and one said, ``We know, but we will not tell
you.''
The point is for NSPS to be successful, the Departments
needs additional money for training.
Mr. Oppedisano. There is no question about that, Mr.
Chairman.
Also, the fact that it just cannot be a one-time
application. It has got to be continuous as the system grows.
Will the system work? It will work. We will make it work. That
is the way we do things in the Department of Defense. And what
will happen now is the fact that you just cannot do one set of
training and expect that to just be it and go your merry way.
It is not going to happen. You have to have a continuous
training operation as the system is implemented.
Senator Voinovich. Do you have experiene with demonstration
projects?
Mr. Oppedisano. I have not at my own installation, no, sir.
Senator Voinovich. Are you aware of them?
Mr. Oppedisano. Yes, I have, sir.
Senator Voinovich. Do you think they offer appropriate
benchmarks for NSPS?
Mr. Oppedisano. I think there are some benchmarks, yes. Do
I think they still need improvement? Yes, I do. I think there
is always room for improvement in any system that we establish.
I think some of the benchmarks are out there. I think some of
the systems have some very good results, but there has been
some dissatisfaction with them, also.
So depending on how they are implemented, and the degree of
implementation, and the degree of training that is given to the
managers and the employees, that is what is going to make the
system successful or not.
Senator Voinovich. I can tell you this, it is a big job.
Anybody that has done performance evaluation knows that it
takes time, and supervisors and managers need to be trained.
Senator Akaka.
Senator Akaka. Thank you very much, Mr. Chairman.
Mr. Gage and Mr. Junemann, you heard my question to Mr.
Nesterczuk about whether veterans preference is protected in
the bump and retreat options during a reduction in force. Do
you agree with Mr. Nesterczuk's response?
Mr. Gage. I think that the performance, the weight on the
performance, the last performance evaluation of an employee,
overweighs or outweighs what currently veterans enjoy on their
preference. I think, in that way, it lessens veterans
preference.
Senator Akaka. Do you have any comment, Mr. Junemann?
Mr. Junemann. Essentially, I agree with what Mr. Gage is
saying. But it just seems without knowing, because we heard
this morning, and I am hearing this for the first time, that
there are some parameters set up on pay-for-performance and
that there are some metrics that DOD has. So I do not know what
is in them.
Without knowing that, there may be something in there about
veterans preference. There may not. Again, it would be nice to
have them. We just met face-to-face last Thursday.
So again, essentially I agree. It sort of seems up in the
air. But they do not have, again because of this unilateral
scrutiny by front-line management on an employee's performance,
it does not seem that veterans rights are protected as much as
they are now.
Senator Akaka. Mr. Oppedisano.
Mr. Oppedisano. Senator, can I respond to that question,
also?
I have had some experience in reductions in force. Over the
period of a 10-year period from 1991 to 2001, I was a director
of human resources and my office and my staff ran nine
reductions in forces. So I know about reductions in force.
Under the current system, there is a process where you do
get certain amounts of time added for performance. It is over a
3-year cycle. And that was more accepted by the unions at the
time.
And to sit back and say that 1 year of performance
adequately shows how that individual will perform in the
future, we do not necessarily agree with. There is something in
the system already that establishes the fact that you do get
recognition for a performance in the reduction in force
process.
To that matter, I am not too much in disagreement with our
union counterparts.
Senator Akaka. Mr. Oppedisano, you and Senator Voinovich
discussed the importance of training. In your opinion, on how
much money do you believe will be needed by DOD to adequately
train employees on NSPS?
Mr. Oppedisano. Senator, I do not have an answer for that
because I really just don't have that kind of knowledge. But I
know there has got to be a lot.
Senator Akaka. This is something that we must pay attention
to. Chairman Voinovich has been a champion of human capital
because we know that in a few years we will be facing the
retirement of the baby boomers. Without training, we are going
to have a huge problem with employees and passing on
institutional knowledge.
Mr. Oppedisano, following up on your earlier comments, what
about a manager who is specifically charged with overseeing
training, just like a chief human capital officer?
Mr. Oppedisano. Well, I do not see where it would hurt
anything. I think it would give some credibility.
However, it depends on how that position is actually
written to say what their duties and responsibilities are. What
influence will they have in Congress with the idea of funding
and so on and so forth? How much influence are they going to
have within the Department, would be another point.
Do I think it is necessary? I do not think it would hurt
anything. I think probably it would be a good point for us to
be able to start.
Senator Akaka. Mr. Gage and Mr. Junemann, the DOD Workers
Coalition made suggestions to DOD and OPM for NSPS. Would you
please describe some of the proposals that were offered to
protect employees while still meeting the Department's national
security mission.
Mr. Oppedisano. Well, Senator, I think that we offered
common-sense, realistic proposals for every concern that
management had.
But I want to say something to Senator Voinovich. I never
said that performance evaluations were not necessary or good
things. They are. My problem is with this particular pay-for-
performance scheme.
Senator the one thing I would like you to watch is to make
sure the bottom does not fall out of Federal pay where they can
hire at localities for whatever they can get an applicant,
money that they would take. That is the real concern I have on
it, not at the top rewarding good employees. I am all for that.
I am afraid with this scheme and the way they have it, they
are going to drop the bottom out of Federal pay to reduce it
across the board.
Mr. Junemann. I would tell you that in the meetings that I
attended with DOD and management, we talked specifically. Some
of their problems are our problems, as well. Some of the
current practices under current law are a bit cumbersome to us
as well as they are to management. And, certainly, there needs
to be continuous reform of these processes.
So we offered ideas on streamlining the process under
labor-management appeals, under such things as if decisions
take too long, we can have expedited arbitrations. We can have
expedited decisions where the arbiter is mandated by statute to
say you will issue a decision within 30 days, 60 days, what
have you. You can even issue bench decisions in cases where
that is appropriate. So we offered these as some of the
suggestions.
Under pay-for-performance, we really never got past the
title pay-for-performance. We never really got into a give and
take on that. My union represents private sector and State,
county and municipal workers as well as DOD and other Federal
employees. So as Chairman Voinovich pointed out that he has
experience, I have experience in this, as well.
And I offered that. We have represented a lot of engineers
and scientists, they are not new to pay-for-performance. We
have a tremendous amount of experience, and when it works, when
it does not work. Certainly training, not only on the front end
but continuous ongoing training of front-line management as
well as employees, is part of all of that.
But employees have to have the assurance that it is going
to work. Right now our local in Portsmouth, New Hampshire, at
the shipyard up in Portsmouth, they are supposed to be reviewed
annually, every employee within--we have a local up there of
about 1,200 workers. They have not had an evaluation, a
performance evaluation, in the year 2003 or the year 2004.
So I cannot go to them and say I am confident that this new
thing will work because they are saying to me we have not had
an evaluation since 2002. How can this new system possibly
work?
And that is really the gist of it. No matter how much
training you put into it, how much you put into the budget, if
the employees are not confident that it is going to work, I
think it is going to fail.
Senator Akaka. Thank you. My time has expired.
Senator Voinovich. Thank you, Senator Akaka.
As I indicated in my opening statement, there are some
elements of the DHS personnel system which are not included in
NSPS. For example, the internal Homeland Security Labor
Relations Board establishes a process whereby employee
organizations may recommend nominees to the Secretary. This
process has not been replicated for the National Security Labor
Relations Board. The Department of Homeland Security
establishes a process for employee involvement on matters such
as pay. No similar process exists under NSPS.
How do you feel about having consistency between the
Department of Homeland Security and the Department of Defense?
Mr. Gage. Well, as you said, or one of the panelists said,
I do not see any reason why they would not be consistent, and I
hope they would be consistently good.
Senator Voinovich. You have got members in both
organizations.
Mr. Gage. We do. And, Senator, DOD went much farther than
DHS. For instance, even on the pay-for-performance, on your
evaluations, in DHS, you can arbitrate it. In DOD, you can only
go to a board or some type of management review board, but even
if they say, ``Yes, employee, you are right. Your evaluation
should be higher,'' it still goes into the management chain so
that they can say, ``But you do not get the commensurate money
for that new review.''
Now, there is no credibility with that type of system with
employees, and I think they should just let us arbitrate these
evaluations--they mean so much to an employee--and have an
impartial third party. As DHS is saying, we can arbitrate
employee evaluations in DHS, and I think DOD ought to follow
that line.
Senator Voinovich. Mr. Junemann.
Mr. Junemann. We do not have employees within the
Department of Homeland Security, but just looking at it, it
makes nothing but sense that the board should be a compilation
of some members appointed by management representatives, some
members appointed by labor representatives. Otherwise what you
have got is two parties meet and eventually reach disagreement,
and you end up going to a board consisting of representatives
from only one party to say who is correct in their argument.
Well, obviously, it is going to be towards management in just
about every case. I mean, that is just common sense.
Senator Voinovich. Mr. Oppedisano, do you have any comment
on that?
Mr. Oppedisano. Again, we are talking a training issue, and
we are talking a monetary issue. We are into the pockets of the
employees at this particular time. And for the employees who
will be dissatisfied with their ratings, it is going to happen,
we know that right up front, but now it is going to be more
adversarial than ever before because now you are talking actual
money into my pocket for a day-to-day operation, my weekly
salary. You are also talking my retirement entitlements, and so
on and so forth.
Should there be an appeal process in place somewhere that
can be relied on as being fair? Yes, we do believe in that.
Senator Voinovich. So you all agree that consistency would
be beneficial?
Mr. Junemann. Absolutely, sir.
Mr. Gage. Senator, except in one area, of course, the
mitigation of penalties. DHS is not much better than DOD when
it comes down to restricting an arbitrator or a third party
from mitigating a penalty. I think both of them have to be
really liberalized on that point.
Senator Voinovich. Well, you are all have an opportunity
during meet-and-confer. I did speak to Secretary England
yesterday. We spent a half an hour together because I wanted to
find out who was going to be leading NSPS implementation. He
assured me that he was going to continue to play a leadership
role.
I will say this, since Secretary England has taken over
NSPS has progressed in a much better manner. He understands
implementation will take a long time and that substantial
resources are needed if it is going to be successful. But I
would like to recommend that you take this period of time and
sit down and come up with your top priorities.
Because there are many unions within the Department of
Defense, I think it would be in your best interest if you
collaborated and prioritized your top concerns.
I would like to be informed, as I am sure Senator Akaka
would as well, on the progress of meet and confer. If you do
not think it is going well--not just differing opinions but the
process itself.
NSPS must be done right. I want to make sure that your
rights are preserved. As you know, I supported binding
arbitration on developing the regulations. I think that if that
had been the case, progress would be a lot further today.
Everybody would have been forced to compromise.
What happens at DOD is significance if the Administration
wants Congress to consider extending these flexibilities
governmentwide. My feeling is that we need a better sense of
this process. It is easy to talk about this implementing an
effective performance management system, but it is a lot more
difficult to actually implement.
I will confer with Senator Akaka, and some of our other
colleagues to discuss NSPS funding, to guarantee that money is
there to train the people.
Senator Akaka, do you have anything else that you would
like to say?
Senator Akaka. Yes. Thank you, Mr. Chairman. I want to
thank you for convening this hearing today. I am sorry that our
witnesses from DOD and OPM were unable to stay to hear our
exchange with our second panel. However, I would like to note
how pleased I am that Dave Walker stayed until the very end of
this hearing. And I want you to know I am with you on this. It
is so important that we have a training program and have money
for it.
And in light of what we are expecting in the future, of
retirements, we are really going to need training programs to
take care of our Federal programs.
So I thank you very much for this hearing.
Senator Voinovich. Thank you very much. The meeting is
adjourned.
[Whereupon, at 12:13 p.m., the Subcommittee was adjourned.]
A P P E N D I X
----------
PREPARED STATEMENT OF SENATOR LAUTENBERG
Mr. Chairman: Thank you for convening this Subcommittee hearing to
review the recently published rules for the new personnel system of the
Department of Defense--the National Security Personnel System (NSPS).
Like the new personnel system of the Department of Homeland
Security, the centerpiece of NSPS is ``pay-for-performance'' and the
virtual elimination of Federal workers' right to bargain collectively.
The Administration ``sold'' both personnel systems to Congress
using the argument that the post 9-11 era somehow required senior
executives and managers to disregard the concerns of rank-and-file
workers.
To this day, I fail to understand the Administration's reasoning.
In fact, I believe that one of the most important lessons to be learned
from the tragedy of 9-11 is that there must be better communication
between the senior levels of management and the rank-and-file.
The notion that the right to bargain collectively and to appeal
personnel decisions somehow threaten national security, and that
Federal employees who are members of a union are somehow suspect, is
deeply offensive.
Frankly, I have grown sick and tired of attacks on organized labor.
The first responders who rushed up the emergency stairwells in the
World Trade Center on 9/11--while civilians filed past them on the way
down--were union workers.
I challenge anyone to question the commitment, professionalism, or
bravery of the union members who dies on 9/11 as they did their jobs
and saved the lives of others.
I'm a strong believer in treating our Federal workforce fairly. As
someone with extensive experience in the private sector, I know that
workers are most productive when they receive fair pay and benefits,
and when they can make their ideas heard.
I can also attest to the unique commitment, talent, and spirit of
public service exhibited by our Federal employees.
With regard to NSPS--the new DOD personnel proposal--I'm
particularly concerned that the plan could be subject to political
manipulation.
Doing away with the normal General Schedule (GS) system--which has
served Federal employees and the American people well--probably creates
more problems than it solves.
Given the importance of the Defense Department's mission, we need
to attract the ``best and brightest'' to work in its civilian
workforce. Beating people down and taking away their rights and union
protections isn't going to create the DOD workforce we need to keep
America safe.
I hope we can work together to fix the problems with this new plan.
I welcome our witnesses and look forward to hearing their testimony
about it.
Thank you, Mr. Chairman.
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