Federal Managers Association

For more information on the legislation, please visit: thomas.loc.gov.

FMA SOLIDIFIES ITS STANCE ON PAY-FOR-PERFORMANCE SYSTEMS

On July 22, 2008, the Senate Homeland Security and Governmental Affairs Subcommittee on Oversight of Government Management, the Federal Workforce and the District of Columbia held a hearing to examine pay-for-performance systems across the government. The hearing, Improving Performance: A Review of Pay-for-Performance Systems in the Federal Government , highlighted perspectives of the Administration and federal employee groups on the performance-based systems. The Federal Managers Association (FMA) submitted written comments for the record.

“Any new personnel system must adhere to certain basic principles if the system is to succeed. The integrity of pay-for-performance will be severely hindered if all high performers are not rewarded accordingly,” FMA said in its comments. “We believe that any personnel system should continue to allocate at least the annual average pay raise that is authorized and appropriated by Congress for General Schedule (GS) employees to those employees under the new system who are “fully successful” (or the equivalent rating), in addition to other merit-based rewards based on “outstanding” performance (or equivalent rating).”

FMA focused the majority of its comments on the Department of Defense’s (DOD) National Security Personnel System (NSPS) and the Internal Revenue Service’s pay-for-performance system. In terms of NSPS, FMA said, “Overwhelmingly, FMA managers and supervisors at DOD believe a switch to pay-for-performance is necessary to not only compete with the private sector for talent, but also to encourage and reward high performance. A performance-driven culture can influence behavior and foster increased production. The time for rewarding employees simply for longevity has passed. Many of the hard-working federal managers entering NSPS want to be rewarded for the job they do and they are excited to finally have this opportunity.”

The comments went on to describe some of the problems managers are experiencing with the program including a lack of training, the cumbersome evaluation process, and the distribution of the pay pools including the perceived bell curve limitations. To that end, FMA commented, “Managers and supervisors have reported extreme pressure from higher-ups to maintain a specified distribution of funds or performance ratings within each pay pool. Managers were also told that there would not be enough money in the pool if all employees were rated 4s or 5s… Forced distribution does nothing but contradict a pay-for-performance system.”

In terms of the IRS system, FMA expressed its concern that performing managers at IRS are not guaranteed the congressionally appropriated pay raise. “The General Schedule increase is the cornerstone of current federal compensation policy and should not be included as part of performance-based increases. The purpose of the yearly increase is to keep government salaries competitive with the private sector in hopes of closing the growing pay gap between the two,” FMA commented.

Additionally, many managers at the IRS face being in the unfortunate situation of having their annual salary equal to the non-manager employees they supervise. Managers and employees operate under two different pay systems and pay bands and therefore it is not uncommon for managers and the employees they supervise to receive the same pay. As there is no additional compensation for the added workload and increased responsibility, there is an inherent disadvantage to becoming a manager.

For a complete copy of FMA’s comments, please visit: www.fedmanagers.org. For more information on the hearing, please visit: http://hsgac.senate.gov/public/.

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WHAT’S HAPPENING ON CAPITOL HILL?

HOUSE MAKES SIGNIFICANT CHANGES TO THRIFT SAVINGS PLAN

Included in the Family Smoking Prevention and Tobacco Control Act, H.R. 1108, were several changes to the Thrift Savings Plan (TSP). Most significantly, under the bill, new federal employees would automatically be enrolled in the plan.

Under the legislation, employees would contribute three percent of their basic pay to the TSP; however, the legislation gives the Federal Retirement Thrift Investment Board the authority to enact a different percentage as long as it is between two and five percent. Of the six funds available in the TSP, the government securities (G) Fund would serve as the default as it has the lowest risk.

The bill also creates a Roth IRA option in the Thrift Savings Plan. Roth contributions come out of post-tax earnings, as opposed to pre-tax earnings like the rest of the TSP. Should the measure ultimately be signed into law, there is no deadline to enact the Roth feature and the Board has said it plans to survey participants on the subject.

For more information on the legislation, please visit: thomas.loc.gov.

CONGRESS HEADS INTO AUGUST RECESS, PLENTY OF WORK AHEAD

Members of Congress are headed back to their home states and districts for the annual August recess. With plenty of issues still left unresolved on the agenda, activity on the Hill should reach a fevered pitch upon Congress’ return.

During recess, U.S. Senators and Representatives will be holding town hall meetings and listening sessions to discuss important issues with their constituents. This is a wonderful opportunity for FMA members to meet with their respective lawmakers in their home state and district, without having to travel to Washington.

While Congress leaves Washington without sending any of the fiscal year 2009 appropriations bills to the President for his final approval or veto, both the House and Senate Appropriations Committees approved a 3.9 percent pay raise for federal employees, at parity with military personnel and one percentage point higher than the White House proposed. The House also voted on the fiscal year 2009 Military Construction-Veterans Affairs appropriations bill (H.R. 6599), approving $72.7 billion in funding for military and veterans programs. The House held the vote in the hours before adjourning for recess.

While it is uncertain whether any other appropriations bills will reach the voting floor when Congress reconvenes, it is likely a continuing resolution will delay many decisions until the next administration assumes the presidency.

Be sure to check your Members’ home page at www.house.gov or www.senate.gov, or call their local offices to get updates on where and when your Members will be meeting with their constituents during this August recess. Better yet, make an appointment with the scheduler to meet face-to-face to let your Members know just what issues are affecting FMA members in their district or state. Do not let these five weeks of recess go by without taking the opportunity to meet with at least one Senator and your Representative!

Click on the Legislative Action Center on our Web site, www.fedmanagers.org, for information on important legislation to discuss with your Member of Congress or contact the FMA National Office at info@fedmanagers.org or (703) 683-8700. Your grassroots efforts as FMA members and constituents are key to our success in Washington, D.C. We need your support in order to make our collective voice heard loud and clear by our elected leaders!

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WHAT’S NEW IN THE EXECUTIVE BRANCH?

BUSH ADMINISTRATION PROJECTS FY09 BUDGET DEFICIT

The Bush Administration is projecting a budget deficit of $482 billion for fiscal year 2009 (FY09), a record setting figure the White House argues provides necessary funding for programs designed to bolster the nation’s economy and ensure the safety of its citizens. Released on July 28, the projected FY09 budget announcement addresses current economic challenges while providing strategies to balance the budget by 2012.

A proposed bipartisan growth package designed to spur investment and totaling over $150 billion contributes heavily to the suggested figure. Bush argues such spending, while increasing the deficit in the short run, will ensure the growth necessary to reduce long term spending. The budget also provides for continued tax relief, an initiative the Administration first implemented in 2001 but was set to expire in 2010. Seeking to provide stability abroad, the White House included a “14.9 percent increase (in funds) for international affairs to support key allies in the Global War on Terror and improve responses to international crises.”

Through detailing steps Bush argues is necessary to balance the budget by 2012, the report admits such success “will be short-lived without addressing our biggest budgetary challenge. S pending on entitlement programs like Social Security, Medicare, and Medicaid is growing faster than we can afford, and there are painful choices ahead if America stays on this path: massive tax increases, sudden and drastic cuts in benefits, or crippling deficits .”

Increasing investment in innovated research and other measures designed to maintain the United State’s position as a world leader in technology is also a priority in the budget.

For more information on the FY09 budget, please visit: www.whitehouse.gov.

AGENCIES FALTER ON COMPETITIVE HIRING PROCESSES

In a report issued in July, the Merit Systems Protection Board (MSPB), a government body charged with examining the use of fair and open practices in the federal hiring process, told the President that agencies across the board are failing to adequately implement competitive examining procedures when recruiting individuals for white-collar positions. Agencies used the competitive hiring process only 28 percent of the time in 2005, a new low over the past decade.

The impact on diversity in the federal workforce may be severely impacted by the choice to forgo this process, as more managers turn to alternative hiring procedures, including several programs designed to assist U.S. veterans. As Neil McPhie, Chairman of the MSPB, explained, the results of the survey “ indicate that many supervisors may not be aware of the implications of their use of these alternative hiring authorities and the specific training and assessment responsibilities that accompany their use.” As agencies’ use of competitive techniques “is generally declining,” McPhie stated, more turn to non-competitive methods “that permit excluding some qualified applicants.”

The report is part of a three-study series designed to indentify and restructure the approach agencies and managers take to recruit and select applicants from various sectors of society. In the face of an impending retirement tsunami facing the federal workforce, MSPB conducted the serious to ensure new hires are selected based on ability in a fair and open competitive system. Directed at both managers responsible with recruiting entry and upper-level employees from outside the government, MSPB looked at methods to construct the most beneficial hiring pipeline to ensure an efficient and effective federal workforce in the future. As McPhie concluded in his statement to the President, “I believe that you will find this report useful as you consider issues affecting the Federal Government’s ability to recruit a highly qualified, diverse workforce that represents the society it serves.”

More information on this report may be found at: www.mspb.gov.

MORE CHANGES AFOOT AS ADMINISTRATION READIES FOR DEPARTURE

On July 29, Office of Management and Budget (OMB) associate director for administration and government performance Robert Shea announced he would be stepping down from his position in September. Shea will leave OMB to work in Grant Thornton’s Global Public Sector, which “provides global business advisory services with the mission of providing responsive and innovative financial, performance management, and systems solutions to governments and international organizations,” according to its website.

At OMB, Shea manages internal affairs while leading the Bush administration’s Performance Improvement initiative, a key element of the President’s Management Agenda. Shea also oversees the Program Assessment Rating Tool (PART), “developed to assess and improve program performance so that the Federal government can achieve better results.”

In other news, Constance Barker was sworn in as a Commissioner of the Equal Employment Opportunity Commission (EEOC) on July 14. Ms. Barker was nominated by President George W. Bush on March 31, 2008, and unanimously confirmed by the Senate on June 27 to serve the remainder of a five-year term expiring on July 1, 2011.

Barker has extensive work experience in both the public and private sectors. She served as an assistant district attorney for the 11 th and 13 th Judicial Circuits of Alabama, one year as a judge for two Alabama localities, and 11 years as the general counsel for the Mobile County Public School System. She also worked for Capell & Howard, P.C. in Montgomery, Alabama, where she provided advice regarding the prevention of discrimination complaints and defended clients in employment discrimination lawsuits.

On August 1, President Bush nominated Michael Hager to succeed Linda Springer as Director of the Office of Personnel Management (OPM). Hager currently serves as Assistant Secretary of Human Resources and Management for the Department of Veterans Affairs and he previously served as Associate Administrator in the Office of Capital Access at the Small Business Administration. Bush nominated Hager for a four-year term.

Springer is set to depart OPM on August 13, accepting a new position in the private sector as Executive Director in the Government and Public Sector Advisory Services Practice of Ernst & Young, LLP. Hager will assume office following her departure pending Senate approval.

For more information on recent personnel changes, please visit: www.whitehouse.gov.

GSA RAISES REIMBURSEMENT RATE

The General Services Administration (GSA) has raised the mileage reimbursement rate from 50.5 cents per mile to 58.5 cents per mile for federal employees who drive personal vehicles while on the job. The announcement on July 28 came in response to an Internal Revenue Service (IRS) adjustment in mid-June, which raised the maximum amount of money businesses may deduct for operating a company vehicle. GSA matched the IRS figure, as typically occurs, which in this case emerged in the wake of rising oil prices. The IRS usually conducts a yearly review of the reimbursement rate, but oil prices necessitated a mid-year review.

The GSA rate change became effective August 1, while the IRS change went into effect July 1. Efforts are underway to standardize any mileage reimbursement rate, calling for GSA to match the IRS in each adjustment made. Current law states that GSA may not exceed the IRS adjustment, but the agency does not necessarily have to match it. Proponents of a mandatory matching policy argue that revision to the law will eliminate the gap that exists between implementation of the IRS adjustment and the GSA match.

Senator Charles Schumer (D-N.Y.) has introduced S. 3032, the Reimbursing Our American Drivers (ROAD) Act of 2008, which would increase the reimbursement rate to 70 cents per mile for those employed in both public and private sectors. The bill is currently under review by the Senate Finance Committee.

For more information on the GSA adjustment, please visit: www.gsa.gov

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GET INVOLVED AT THESE EVENTS!

MID-YEAR CONFERENCE STARTS THIS WEEK!

Please join us for FMA’s 17th annual Mid-Year Conference and Management Training Seminar, August 6 – 9, 2008 in Philadelphia, Pennsylvania! This year’s Conference, Where Leadership in Government Began, will be held at the Sheraton Society Hill Hotel. Conference attendees will receive a special room rate of $149/night. You can make reservations by calling the hotel at 215-238-6000 and be sure to let them know you are with the Federal Managers Association Mid-Year Conference. The special rate is available August 3 – 10, 2008.

FMA members are now able to register for the conference via FMA’s Web site at www.fedmanagers.org. Fees for the Conference are as follows:

Early-bird: $325 (until June 27, 2008), Regular: $375, (until July 18, 2008), and Late: $400 (until August 1, 2008).

ATTEND THE 2008 NATIONAL SUMMIT ON EMPLOYMENT LAW AND COMPLIANCE

FMA has partnered with the American Strategic Management Institute (ASMI) to promote this outstanding summit, September 29 - October 1, 2008, in Washington, D.C. Gain a thorough understanding of the latest federal labor and employment laws to keep your organization compliant. The summit will feature f our comprehensive tracks: Recruiting and Hiring: Learn how to comply with all the applicable legal requirements when interviewing and hiring a qualified candidate; Wage and Hours: Stay up-to-date on the latest policy changes with FMLA, FLSA and workers compensation; Employment Policies: Develop a concise employee handbook that communicates your office policies in a clear and organized manor, and; Employee Benefits: Create a comprehensive benefits package that attracts potential employees and is in full compliance with the law.

Best of all, FMA Members will receive a $200 discount off registration fees! For more information visit: www.asmiweb.com/events/w197.html.

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Long Term Care Partners, LLC , FMA Corporate Partner. Long Term Care Partners is the administrator of t he Federal Long Term Care Insurance Program. Sponsored by the U.S. Office of Personnel Management, the Program is available to Federal and U.S. Postal Service employees and annuitants, active and retired members of the uniformed services, and their qualified relatives. With more than 210,000 enrollees, it is the largest employer-sponsored long term care insurance program in the country. FLTCIP policies are simple to understand and offer enrollees some distinct advantages, including comprehensive coverage, competitive and stable rates, international coverage, and administrative service standards that are the highest in the long-term care insurance industry. Policies are sold direct through a highly-trained, non-commissioned staff with no high pressure sales tactics – simply sound advice. Visit www.LTCFEDS.com or http://www.opm.gov/insure/ltc/index.asp for more information.

Blue Cross Blue Shield Association Federal Employee Program, FMA Corporate Partner: The Blue Cross and Blue Shield Association represents the independent, locally operated Blue Cross and Blue Shield Plans. The 40 local member companies of the Blue Cross and Blue Shield Association have provided millions of families with top-quality, affordable health insurance for more than 70 years. For the one in four Americans who carry Blue Cross and Blue Shield cards, the Blue Plans symbolize health security. Visit www.fepblue.org and join the best, most-recognized group of health insurance providers in the world.

GEICO, FMA Corporate Partner: GEICO was created over 60 years ago to insure Federal employees. Over the years GEICO has continuously strengthened its affiliation with the Federal workforce. Today GEICO has a special program established to support the Federal community. GEICO’s Federal program participates in the following organizations and programs: GEICO Public Service Awards, which have honored Federal workers (active and retired) who have contributed to the public good since 1980; and GEICO Federal Leave Record Cards, which for over 40 years have been provided by GEICO to Federal employees, free of charge, to help them track their annual leave. Find out how much you could save with GEICO auto insurance as an FMA member by getting a line-by-line rate quote at: www.geico.com

Shaw, Bransford, Veilleux and Roth, P.C. , (SBVR) concentrates its law practice on the representation of Federal employees, with a special emphasis on the representation of executives and managers. SBVR serves as General Counsel to the Federal Managers Association and is uniquely situated to recognize the interests and viewpoints of Federal managers. For up to two free half-hour legal consultations and reduced legal fees as an FMA member, please visit: www.shawbransford.com

The Federal Managers Association and Management Concepts have teamed up to present the Federal Managers Practicum — a targeted certificate program for Federal managers. As the official development program for FMA, the Federal Managers Practicum helps FMA members develop critical skills to meet new workplace demands and deepen their managerial capabilities. FMA’s leadership fully recognizes the need to prepare career-minded federal employees to manage the demands of the 21 st century workplace with greater competence and fully supports this unique and comprehensive certificate program. For more information, please visit: www.managementconcepts.com/fmp/fmpodp.asp

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The Washington Report is published biweekly by the Federal Managers Association.
Jessica Klement, Editor; FMA Staff Writers.

The Federal Managers Association, established in 1913, is the oldest, largest, most influential association representing the interests of the nearly 200,000 managers, supervisors and executives serving in today’s Federal government.

1641 Prince Street ~ Alexandria VA 22314-2818 ~ (703) 683-8700 ~ FAX (703) 683-8707 ~ E-Mail Info@fedmanagers.org

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