December 20, 2007

Pay for Performance Editorial – a NTEU FDIC member opines on PFP

I see no way to improve the program to remove its high level of subjectivity and the potential impact of favoritism and discrimination.  Few organizations have truly succeeded in implementing a program of this type and according to studies many are now dropping, or radically changing, these types of programs.  Having forced distributions is ridiculous, particularly given that so much is dependent on how effective an individual supervisor is in setting forth his/her case for each subordinates’ ratings.  If one person’s supervisor is a more effective communicator/writer than another’s supervisor, then that person will have a significant advantage in getting in the higher rated category.  I also believe it is unfair that a person could theoretically be a better employee than 74 out of every 100 employees (the 74th percentile, or just barely missing the highest rating category) and still be losing to inflation.  This has happened in both 2005 and 2006.  It is very unfair that 74 percent of the FDIC’s employees, although all determined to be satisfactory or better performers should get raises below inflation, below those received by social security recipients (who are referred to as individuals on “fixed-income” although they have been getting larger increases than most FDIC employees), and even retired FDIC (Civil Service Retirement System) employees.  I realize this is partially a result of the “no one can understand” reduction/offset of locality pay whereby our annual raises are reduced by more than 50 basis points yearly.  No one has yet adequately explained why this is taking place and upper management’s explanation that is required due to the OPM or some such thing appears bogus given the GAO report (GAO-07-678) released on 6/18/07 that states, “Because each financial regulator sets its own locality pay percentage based on its respective policies, locality pay percentages often differ from those that the OPM sets for General Schedule employees.”  From this report, it also appears the FDIC is losing to other FIRREA agencies in the area of pay, as average examiner pay is shown as 6th place out of 7 agencies (the FDIC is only ahead of the NCUA).  Is this a result of the PFP in recent years?

Overall, and in summary, it seems that we would save a considerable amount of valuable time and effort by reverting back to something similar to the old GG step scale.  I also find it offensive that the FDIC spokesman for our pay program would go to the press and tell them what a success it has been.