By Brittany Ballenstedt
A new pay-for-performance system at the Defense Department is expected to set the pace for the rest of federal government in boosting productivity and leadership. It remains to be seen, however, whether annual pay increases will be enough to motivate and keep valued employees.
In January, the Pentagon announced that 98 percent of the 110,000 employees under the National Security Personnel System received performance-based payouts averaging 7.6 percent. That's more than twice the percentage given to General Schedule employees, who got 2.5 percent across the board and an additional 1 percent bump in locality pay.
Comparing NSPS raises with those in the GS system, however, is like comparing apples to oranges, many Defense employees say. The NSPS factors into the overall performance-based raise funds that the GS system directs to within-grade pay boosts, quality step increases and bonuses. The average NSPS payout also includes a 1.7 percent performance bonus, which General Schedule employees are eligible to receive on top of the annual increase.
One of the major concerns among employees and federal labor unions is because Pentagon officials are funding NSPS pay at the same level as the General Schedule, employees receiving average ratings must be receiving less to fund higher increases for those receiving top ratings. For the 2008 payout, 57 percent of employees received average ratings.
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