Federal Manager's Daily Report

The Office of Personnel Management has issued changes to the

new Senior Executive Service performance-based pay system


effective Jan. 11, 2004, regarding post-employment conflict

of interest restrictions. The restrictions currently

covering ES-5 and ES-6, will be extended to cover individuals

with basic pay equal to or greater than 86.5 percent of the

level II ES rate, as well as to those who prior to Nov. 24,

2003 received basic pay exclusive of any applicable locality

based comparability payment, equal to or greater than the

ES-5 basic pay rate ($134,000), according to OPM.

The new law requires that those affected by the above changes

be notified in writing. OPM soon will issue guidance for doing

so, but asked that the heads of executive departments and

agencies be the ones who notify those SES members covered

by the changes. Here is a sample notice for doing so


The new SES pay guidance says that “equal pay should be

provided for work of equal value . . . and appropriate

incentives and recognition should be provided for

excellence in performance,” according to OPM.

The new system replaces automatic SES locality pay

adjustments and automatic pay increases coinciding with

annual pay adjustments for general and executive schedule

employees, with SES pay increases directly linked to

individual and organizational performance, said the agency,

allowing for higher base pay limits, and establishing level

III ($142,500) as the base. (These changes do not apply to

senior-level and scientific or professional employees.)

The policy also calls for a new performance appraisal

system, an open pay range eliminating the six ES pay levels,

and a new compensation limit equal to the Vice President

($198,600), explained OPM.

For additional information, agency chief HR directors and

officers should contact the Center for Leadership and

Executive Resources Policy, at: (202) 606-1050.