The Defense Department has published proposed rules (in
the February 14 Federal Register) to carry out its
“national security personnel system,” which as expected
seeks to move the department’s employees to a
pay-for-performance system. To replace the general
schedule–and later on, the wage grade system–DoD wants
to create occupational series, with broad pay bands
that give managers greater leeway in setting salaries
and in which advancement will be based on performance,
not longevity. DoD plans to keep locality-based pay
adjustments, at least for the interim, but money that
otherwise would be spent on across-the-board raises,
within-grade raises and promotions would go into a
pay pool, to be paid out primarily to reward
performance–although additional local market-based
adjustments also are envisioned. Employees performing
at an unacceptable level would not be eligible for
any type of raise, under the new system
