WASHINGTON — A federal labor union is urging the Pentagon to kill a proposed demonstration project with a unique pay system and hiring rules to fill key civilian positions in the U.S. Army Futures Command Science and Technology Reinvention Laboratory.

The American Federation of Government Employees, which represents more than 700,000 federal workers, including a quarter million at the Defense Department, gave feedback on the plan to create an agency-specific personnel management system with decentralized authority.

“Throughout the notice, the sketchy boilerplate rationale is provided that the ostensible intent of enhancing managerial flexibilities is ‘to attract, motivate, train, and retain a top-performing science, technology, and modernization workforce,’” said AFGE National President Everett Kelley in a statement. “Unfortunately no behavioral science or management studies are cited to support this boilerplate.”

The Pentagon said in its proposal that the demo project is designed to give it an advantage in recruiting a skilled workforce that is in high demand for AFC, one of the Army’s newest command structures. A spokesperson for DoD did not immediately return an emailed message seeking comment.

The demonstration project would include pay banding, performance-based compensation, flexible hiring and a “modern approach to career progression and assignments,” according to the department.

Demos that use pay banding have been relatively successful in the past, said Steve Lenkart, executive director of the National Federation of Federal Employees.

“Usually it’s higher than the GS scale, so people want to do it,” he said. “And it gives hiring managers the flexibility, so it’s not so rigid.”

Demos can cause problems, Lenkart said, if employees feel that they’re competing within a pay band against others who have less experience or expertise but are similarly compensated.

Some other STRLs, of which there are 21 in DoD, have adopted supplemental pay flexibilities that are based on the OPM special salary rate tables that provide for higher salaries than the General Schedule tables. This supplemental pay flexibility permits STRLs to independently establish supplemental pay rates based on market conditions.

“Competing with private sector compensation is particularly challenging, especially in emerging mission areas such as hypersonics, autonomy, cybersecurity and data science,” according to a May notice by the DoD.

How does proposed system differ from GS schedule?

Occupations with similar characteristics would be grouped together into one of three career paths with pay bands designed to facilitate pay progression. Inspired by the GS schedule, each career path will be divided into three to five pay bands with each covering the same pay range now covered by one or more GS grades.

The pay-for-performance system uses annual payouts that are based on the employee’s total performance score rather than within-grade increases, quality step increases and performance awards. In addition, each pay band will have its own pay ceiling, just as grades do in the GS system.

“Measuring and docking individuals in a performance measurement system every time they make a mistake, or evaluating them based on a ‘bell curve,’ is the best way of destroying morale and reducing productivity, enthusiasm, creativity and collaboration,” Kelley said.

The proposal also said competitive service positions will be filled through merit staffing, direct-hire authority, delegated examining, or other non-competitive hiring authorities.

Such a personnel management system is needed, the Pentagon argues, because STRL oversees organizations with workforces that differ in mission and have capabilities that require a more tailored approach to pay, promotion and hiring.

Components of STRL are also geographically dispersed to areas where the competition for talent is steep.

The GS won’t cut it because it’s too rigid in its job descriptions and promotions, and too slow to respond to changes in the work itself, which in STEM fields is often rapidly evolving, according to DoD.

“Modern employees expect careers that include frequent company changes, new challenges, and work-life balance fluctuations that do not require staying with a single employer,” the proposal said.

AFGE’s Kelley said the demo proposal “provides conclusory rationale without supporting analysis, contains incoherent rationale, and in some cases exceeds statutory authority.”

Pay banding is not the only solution to attracting the best talent in highly specialized occupations, and the GS already addresses issues these alternative plans are designed to solve, the union said.

“There are a lot of unused talent and abilities in our country that we do not fully harness because we write off people through performance measurement rather than lead them into excellence and achievement,” it said.

Molly Weisner is a staff reporter for Federal Times where she covers labor, policy and contracting pertaining to the government workforce. She made previous stops at USA Today and McClatchy as a digital producer, and worked at The New York Times as a copy editor. Molly majored in journalism at the University of North Carolina at Chapel Hill.

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