<DOC> [109 Senate Hearings] [From the U.S. Government Printing Office via GPO Access] [DOCID: f:28238.wais] S. Hrg. 109-814 PREPARING FOR TRANSITION: IMPLEMENTATION OF THE NATIONAL SECURITY PERSONNEL SYSTEM ======================================================================= HEARING before the OVERSIGHT OF GOVERNMENT MANAGEMENT, THE FEDERAL WORKFORCE, AND THE DISTRICT OF COLUMBIA SUBCOMMITTEE of the COMMITTEE ON HOMELAND SECURITY AND GOVERNMENTAL AFFAIRS UNITED STATES SENATE ONE HUNDRED NINTH CONGRESS SECOND SESSION __________ FIELD HEARING AT FORT DERUSSY, HONOLULU, HAWAII __________ APRIL 12, 2006 __________ Printed for the use of the Committee on Homeland Security and Governmental Affairs U.S. GOVERNMENT PRINTING OFFICE 28-238 PDF WASHINGTON : 2007 ------------------------------------------------------------------ For sale by Superintendent of Documents, U.S. Government Printing Office Internet: bookstore.gpo.gov Phone: toll free (866) 512-1800; DC area (202) 512-1800 Fax: (202) 512-2250. Mail: Stop SSOP, Washington, DC 20402-0001 COMMITTEE ON HOMELAND SECURITY AND GOVERNMENTAL AFFAIRS SUSAN M. COLLINS, Maine, Chairman TED STEVENS, Alaska JOSEPH I. LIEBERMAN, Connecticut GEORGE V. VOINOVICH, Ohio CARL LEVIN, Michigan NORM COLEMAN, Minnesota DANIEL K. AKAKA, Hawaii TOM COBURN, Oklahoma THOMAS R. CARPER, Delaware LINCOLN D. CHAFEE, Rhode Island MARK DAYTON, Minnesota ROBERT F. BENNETT, Utah FRANK LAUTENBERG, New Jersey PETE V. DOMENICI, New Mexico MARK PRYOR, Arkansas JOHN W. WARNER, Virginia Michael D. Bopp, Staff Director and Chief Counsel Joyce A. Rechtschaffen, Minority Staff Director and Chief Counsel Trina Driessnack Tyrer, Chief Clerk OVERSIGHT OF GOVERNMENT MANAGEMENT, THE FEDERAL WORKFORCE, AND THE DISTRICT OF COLUMBIA SUBCOMMITTEE GEORGE V. VOINOVICH, Ohio, Chairman TED STEVENS, Alaska DANIEL K. AKAKA, Hawaii NORM COLEMAN, Minnesota CARL LEVIN, Michigan TOM COBURN, Oklahoma THOMAS R. CARPER, Delaware LINCOLN D. CHAFEE, Rhode Island MARK DAYTON, Minnesota ROBERT F. BENNETT, Utah FRANK LAUTENBERG, New Jersey PETE V. DOMENICI, New Mexico MARK PRYOR, Arkansas JOHN W. WARNER, Virginia Andrew Richardson, Staff Director Richard J. Kessler, Minority Staff Director Nanci E. Langley, Minority Deputy Staff Director Emily Marthaler, Chief Clerk C O N T E N T S ------ Opening statements: Page Senator Voinovich............................................ 1 Senator Akaka................................................ 3 WITNESSES Wednesday, April 12, 2006 Maureen U. Kleintop, Deputy Chief of Staff for Total Fleet Force Manpower and Personnel, Commander, U.S. Pacific Fleet.......... 6 Jeffrey T. Wataoka, Director, Human Resources Service Center Pacific, Department of the Navy................................ 8 Michael L. Vajda, Director, Civilian Human Resources Agency, U.S. Army, Aberdeen Proving Ground, Maryland........................ 10 John C. Priolo, Retired President, Chapter 19 Pearl Harbor Naval Shipyard, Federal Managers Association......................... 21 Benjamin T. Toyama, International Vice President, Western Federal Area, International Federation of Professional and Technical Engineers (IFPTE), AFL-CIO CLC and Vice President of IFPTE Local 121, Pearl Harbor Naval Shipyard......................... 23 Don Bongo, Vice President, Hawaii Federal Employees Metal Trades Council, AFL-CIO CLC and Sergeant First Class, E-7, Hawaii National Guard, 227th Engineer Company (combat), 29th Brigade.. 25 Alphabetical List of Witnesses Bongo, Don: Testimony.................................................... 25 Prepared statement........................................... 86 Kleintop, Maureen U.: Testimony.................................................... 6 Prepared statement........................................... 35 Priolo, John C.: Testimony.................................................... 21 Prepared statement........................................... 60 Toyama, Benjamin T.: Testimony.................................................... 23 Prepared statement........................................... 79 Vajda, Michael L.: Testimony.................................................... 10 Prepared statement........................................... 54 Wataoka, Jeffrey T.: Testimony.................................................... 8 Prepared statement........................................... 48 APPENDIX Questions and answers submitted for the Record from: Ms. Kleintop with attachments................................ 89 Mr. Wataoka.................................................. 112 Mr. Vajda.................................................... 130 Mr. Priolo................................................... 153 Mr. Toyama................................................... 156 Mr. Bongo.................................................... 159 PREPARING FOR TRANSITION: IMPLEMENTATION OF THE NATIONAL SECURITY PERSONNEL SYSTEM ---------- WEDNESDAY, APRIL 12, 2006 U.S. Senate, Oversight of Government Management, the Federal Workforce and the District of Columbia Subcommittee, of the Committee on Homeland Security and Governmental Affairs, Washington, DC. The Subcommittee met, pursuant to notice, at 1:37 p.m. P.S.T., in the Asia-Pacific Center for Security Studies, Fort DeRussy, Honolulu, Hawaii, Hon. George V. Voinovich, Chairman of the Subcommittee, presiding. Present: Senators Voinovich and Akaka. OPENING STATEMENT OF SENATOR VOINOVICH Senator Voinovich. This hearing will come to order. This is a hearing of the Subcommittee on Oversight of Government Management, the Federal Workforce, and the District of Columbia of the Committee on Homeland Security and Governmental Affairs. I would like to remind everyone that this is an official hearing of the U.S. Senate, and Senator Akaka and I discourage audience participation except for the witnesses. We thank you all for coming. The title of today's hearing is, ``Preparing for Transition: Implementation of the National Security Personnel System.'' Senator Akaka and I were both involved in the consideration of the National Security Personnel System in 2003, and we have both followed its development closely. We held two oversight hearings specifically on NSPS last year, and we hope to hold another one later this year. We have also held five other hearings on the various challenges confronting the Federal Government's national security workforce over the last several years. We've been working on this for about the last 7 years, haven't we, Senator Akaka? Senator Akaka. Yes we have. Senator Voinovich. I would like to publicly mention, in Senator Akaka's home State, the high regard that I have for Senator Akaka. He does an excellent job of representing the interest of his constituents. Occasionally we have differences of opinion about issues, but what we try to do is find those things that unite us rather than divide us. I've gotten to know Senator Akaka through our Thursday Bible studies in the U.S. Senate. Senator Akaka, his wife Millie, and his family are a real asset to the U.S. Senate. The people of Hawaii should be proud of Senator Akaka, a man of high integrity, a man who works hard, and a man who represents his State, but also considers what's in the best interest of the country. I was concerned right from the start that the implementation schedule for NSPS was much too fast, and Senator Akaka also is very concerned about that. In fact, it appeared that the Defense Department might try to put NSPS into effect by October 2004. Can you imagine? I scheduled a meeting with the Department's top leaders on March 30, 2004. I met with Deputy Secretary Paul Wolfowitz and then- Secretary of the Navy Gordon England, and urged them to slow down the implementation schedule for NSPS. I stressed to them that doing it right was much more important than doing it quickly. They agreed and slowed down the process considerably, and since then, I believe the Defense Department, in partnership with the Office of Personnel Management, has proceeded thoughtfully and carefully. I think everybody understands that NSPS is here to stay: That's a given. I believe, for several reasons, that it has an excellent chance for success. First, top leaders of the Department, most notably Deputy Secretary of Defense Gordon England, are involved. Second, DOD has decades of experience with alternative personnel system. DOD has more experience with this than probably any other department in the Federal Government. The defense labs, which we have at Wright-Patterson Air Force Base in Dayton, Ohio, have had this for several years and it's worked out terrific for them. Third, the Defense civilian workforce, in my view, is one of the more motivated in the Federal Government. It has a clear mission and sense of purpose. And finally, the military culture, which is a strong presence in DOD, already requires that all military personnel receive a written annual performance appraisal, so there's a culture here throughout the Defense Department. This appraisal system affects awards and pay through promotions. In other words, if you're doing your job and you move up, you get more money, and if you don't, you don't get the promotion and you don't get the money. Now, 2\1/2\ years after it was authorized, NSPS will go into effect on April 30. Today we are focused on where the rubber meets the road. Thousands of miles from Washington, DC, where we debated and established this system, we want to learn what's going on. Today we're talking about some 250 people here in Hawaii, and they are just the first of over 16,000 DOD civilian employees in Hawaii who will eventually be in NSPS. We have thousands of people in Ohio who will also go into NSPS. In fact, the train-the-trainer sessions are taking place in Ohio, and I'd be interested to hear what you think about it. The components we are examining today are now the laboratory. Our oversight must focus on ensuring that NSPS is properly funded and thoughtfully, fairly, and deliberately implemented. I am particularly interested in learning about the training, as I mentioned to you, and I'd like to hear exactly how the Defense components are implementing NSPS and how they are preparing their people for the enormous changes in workplace management that are under way. I would like to hear from the employee representatives what they are doing to make sure that NSPS is a success, and what suggestions they may have for improving the implementation of NSPS. I look forward to a productive session. I would mention that I implemented personnel reforms when I was mayor of the City of Cleveland. It was very difficult. That's when I really started to understand how important training is, so that employees understand what is expected of them. Training should also be of good quality and it must be done properly. When I was governor of Ohio I instituted total quality management. We called it QSTP, Quality Services Through Partnership. The first thing I did was to attend 4 days of training with my labor leaders. I was there and took the time to learn the new system. We really worked hard on getting people to understand what Quality Service Through Partnership meant. And what started out as something that the unions thought would be bad, turned out to be the best thing that we ever did. It was the first time that they could recall that they were empowered to be involved in examining their work and how they could improve. Now, the tough job was changing the culture of our middle managers, because they had spent their careers in a command and control environment. So this was the hardest thing to overcome. I would really appreciate it if everyone would have an open mind on this issue, give DOD a chance to move forward with it. If it's not working out the way it should be, we'll do everything that we can to make sure that we correct those things. We know it's not perfect, but I think it's really in the best interest of our country and our employees. I now yield to my good friend, Senator Akaka. OPENING STATEMENT OF SENATOR AKAKA Senator Akaka. Thank you very much. I want to say mahalo to my Chairman, George Voinovich, and I also want to welcome his lovely wife, Janet, who is here with us. Will you raise your hand? Thank you for joining us today. And to all of you, as we say in Hawaiian, aloha auinala, which is good afternoon, too. I want to thank my Chairman for holding this field hearing on the National Security Personnel System in my home State of Hawaii. Sometimes you think about wanting to do something like this, and think about how hard it is and you think, well, it can't happen. Well, it has happened. The Chairman is here and I'm here, and I'm really indebted to him for having this hearing here in Hawaii. Chairman Voinovich and I have worked very well together, in a bipartisan manner, and the reason is he's easy to work with, and he's very open-minded. The difference is that besides being a Senator and former mayor, he was also a governor. He's had all these experiences with people in different levels of government, and knows government. And so I really appreciate working with him. And I'm also happy to join and welcome our distinguished witnesses and our equally distinguished audience. I extend a special thank you to General Hirai because you have just become the deputy director. I want to thank you and the staff at the Asia-Pacific Center for Securities Studies for making available the center today. The Center has made Hawaii the gateway for the Department of Defense's interactions with Asian militaries, and the Center's importance will only grow in this Age of the Pacific. I've been here before, and I have witnessed what goes on here. What's great about this place is that it creates relationships that build confidence and knowledge of the United States with other countries. The Center has been a real benefit to the United States over the years. Mr. Chairman, like you, I have heard from numerous Defense Department employees about their concerns with NSPS, and I appreciate your working with me to provide a local forum to discuss one of the most critical elements of NSPS, employee training. Nothing is more important to the Federal Government than how it hires, fires, compensates, and evaluates its employees. Federal employees are the ones charged with the public's trust to carry out agency missions. Since such employee programs go to the very heart of agency performance, training for these programs is critical, as is ensuring that there are mechanisms in place to assess the effectiveness of training. This hearing provides us with a unique opportunity to review the training and communication programs for managers and employees who will transition into Spiral 1.1 at the end of this month. We want to know who has been trained, what kind of training they are receiving, how the training is being delivered, how the training programs are being evaluated and coordinated, and what the cost is of such a massive undertaking. Getting training right on the front end of the implementation of NSPS could promote greater employee understanding. Getting it wrong will send managers and employees on a scavenger hunt to figure out for themselves what's happening, when it's happening, to whom it's happening, and this could lead to misinformation. NSPS represents a huge cultural change for DOD civilian employees, and setting aside my personal feelings on NSPS, I want to explore what I see as a decentralized training regime. While I understand the design and the need to place training responsibilities within individual service commands, I am concerned that this could lead to inconsistent training that will benefit no one. Because pay under NSPS will depend on effective training, there is no room for uneven or unequal training opportunities. For a system that rests so heavily on a manager's ability to make meaningful performance distinctions among employees, whose pay and work will be directly impacted by these managerial decisions, there must be strong oversight, accountability, and transparency. My understanding is that while the Project Executive Office (PEO) in Washington, DC, developed the training programs, individual commands are responsible for providing and funding all training for its personnel. In Hawaii, the vast majority of those going into Spiral 1.1 will be Navy civilian personnel. Given the Navy's emphasis on the One Shipyard Vision, I am curious whether all Navy commands will use the same approach for NSPS training. However, it is important to note that Pearl Harbor Naval Shipyard is mission funded unlike the other three shipyards. Given that our Shipyard is mission funded, I will be interested to know whether the Department will provide additional funds for the training. If agility and flexibility are the end game in this pay- for-performance system, then training must be consistent so that no employee is at a disadvantage. DOD's civilian managers, who are the backbone of the new system, must have training that will provide them with the skills and understanding to foster collaborative relationships with their employees, especially in areas like developing performance expectations. We must make certain that managers, over half of whom are eligible for retirement, by the way, are given the support and resources necessary to carry out the implementation of NSPS. Mr. Chairman, again I want to thank you so much for holding this hearing here. and I feel that the Asia-Pacific Center is a great place for this kind of hearing because this is a place where we will build relationships. Senator Akaka. Also, since the Chairman did mention that we didn't want any responses from the audience, I want to just point out that I have staff here that would be willing to meet, in case you have a concern, with those in the audience and pass on your concern. If you do, they'll be out in the lobby. I want to introduce them both, Nanci Langley and Jennifer Tyree, for all their work. Thank you very much, Mr. Chairman. Senator Voinovich. Thank you, Senator Akaka. I'd like to second the thanks to those responsible for welcoming us to this excellent facility. I am pleased that Jennifer Hemingway, a member of the staff of Senator Collins' Homeland Security and Governmental Affairs Committee, is present with us. I especially would like to thank Nanci Langley of Senator Akaka's staff for the work that she did in preparation for this hearing. In addition, I would also like to thank Andrew Richardson from my staff, who's this Subcommittee staff director, for all the work that you and your team have done for this hearing. We are very fortunate today to have three wonderful witnesses. We have Maureen Kleintop, the Deputy Chief of Staff for Total Fleet Force Manpower and Personnel, of the staff of the Commander, U.S. Pacific Fleet. Jeffrey Wataoka, the Director of the Human Resources Service Center Pacific of the Department of the Navy. And Michael Vajda, the Director of Civilian Human Resources Agency, in Aberdeen Proving Ground of the Department of Army, so I'm glad to have you all here. We have a custom in this Subcommittee that we swear in our witnesses, so if you'll please stand, I will administer the oath. Do you swear that the testimony you are about to give this Subcommittee is the truth, the whole truth, and nothing but the truth, so help you, God? Please have the record note that all witnesses have answered in the affirmative. I'd like all of you, if possible, to keep your statements to 5 minutes or less. Your entire written testimony will be entered into the record. There is a good possibility that we will not be able to ask all the questions we would like, so we may submit to you some questions in writing. Ms. Kleintop, please proceed with your testimony. TESTIMONY OF MAUREEN U. KLEINTOP,\1\ DEPUTY CHIEF OF STAFF FOR TOTAL FLEET FORCE MANPOWER AND PERSONNEL, COMMANDER, U.S. PACIFIC FLEET Ms. Kleintop. Thank you. Good afternoon, Chairman Voinovich and Senator Akaka. I'm very pleased to be here this afternoon to discuss the implementation of the NSPS at COMPACFLT Headquarters. This afternoon I'll cover how we have prepared for the NSPS, and how NSPS will further our mission. --------------------------------------------------------------------------- \1\ The prepared statement of Ms. Kleintop appears in the Appendix on page 35. --------------------------------------------------------------------------- Admiral Roughead, as Commander of the Pacific Fleet, believes our civilian workforce is vital to accomplishing our mission. In his recent Commander's Intent entitled ``Enhancing Asia-Pacific Sea Power,'' he focuses on four areas that maximize our contribution to regional security and stability. These are: Warfighting readiness, force posture, regional relationships, and future preparedness. Our civilian workforce is key in every area. It is essential that we have a human resources system that is capable of supporting and protecting their critical role in COMPACFLT's total force effectiveness. COMPACFLT Headquarters volunteered to be among the first of the Department of Defense organizations to implement NSPS. We have a successful record of leading transformational change and a strong commitment to building a high performance workforce. On April 30, 2006, 170 employees assigned to COMPACFLT Headquarters command will convert to this new personnel system. To compare the employees for this conversion, we have taken an assertive and responsible approach. We have implemented a very rigorous training program and have maintained open lines of communication to ensure the workforce that we are committed to their success. About a year and a half ago, I appointed a project manager, a change management agent, a training program manager, and chartered an NSPS implementation team. Our project manager and the implementation team launched a massive communication effort that incorporated the use of our on-line knowledge management tool called eKM. Almost 300 documents including news items, memos, and newsletters, and links to NSPS have been posted on this particular eKM. We have also distributed NSPS brochures developed by the Department's Project Executive Office. We took a very proactive approach in providing informal education sessions and established networks with local DOD activities here in the islands. We hosted and invited local representatives to participate in the following events and training sessions: <bullet> LBeginning in July 2004, town-hall meetings hosted by Ms. Pat Adams, who's the Deputy Assistant Secretary of the Navy for Civilian Human Resources. <bullet> LFebruary 2005, roundtable discussions led by China Lake's demonstration project, human resorces management team. <bullet> LFrom February through September 2005, we conducted informational sessions facilitated by our project manager and the change agent that we basically brought on board. <bullet> LOn May 31, 2005, we hosted a question-and-answer panel discussion led by some of our own employees who had demo experience or who had private industry experience with pay-for- performance. <bullet> LFinally, in August 2005, the Department of Navy's Project Management Officer came out and conducted an executive- level presentation, a briefing for managers and supervisors, a town-hall style briefing, and a meeting with members of the Federal Managers Association at the Pearl Harbor Naval Shipyard. So that kind of gives you a sense of some of our informal sessions. We've incorporated a blended approach to our NSPS strategy, and, sir, we were fortunate enough to send 10 of our employees to Columbus, Ohio, to receive the training, train the trainer, on the human resorces technical elements, and, in fact, some of them are here today and probably could attest to that training. This approach, our blended approach, includes the following: Former classroom training, some facilitated workshops, and some e-learning courses. The Navy's Knowledge On-line (NKO) site hosts DOD's web- based training and the Department of Navy's e-learning curriculum. Our soft-skilled training entitled ``Coaching for High Performance'' was launched in April 2005. We trained a total of 114 managers and supervisors, not only from COMPACFLT Headquarters, but other local activities in Oahu. From January through March 2006, we conducted 19 follow-on workshops to assist our directors in developing organizational performance objectives cascading from Admiral Roughead's Commander's intent to create that kind of activity. DOD's web-based training, called NSPS 101, also provides a well-organized introduction to NSPS and features a conversion tool that our employees are now using. Last Friday, on April 7, 2006, COMPACFLT's top leadership flag and NSPS members attended a Senior Leader Forum that provided an executive-level overview not only of the NSPS architecture, but it also focused on their leadership responsibilities as well as the Performance Management System. Training on human resorces elements for managers, supervisors, and employees was initiated on April 5, 2006, and to date, we have trained over 200 managers, and supervisors, and employees, primarily from COMPACFLT Headquarters but also others from the islands. Our first of three ``Performance Management for Managers and Supervisors'' courses began on Monday of this week, April 10, 2006. And beginning April 18, our employees will receive 8 hours of Performance Management training and learn to develop their personal job objectives linked to the Commander's Intent that has been published by Admiral Roughead. Formal training on Writing Accomplishments and Pay Pool Management will be added to our training curriculum as soon as those courses are developed. By April 30, 2006, we will have trained almost 250 individuals on the technical aspects of NSPS. Successful execution of our communication and training strategies has prepared our workforce for the upcoming transition. We have built credibility into each aspect of our deployment plan by involving our people. The face-to-face communication structure provided by the implementation team, as well as event and training evaluations, allowed us to effectively incorporate employees' feedback into our strategies. All employees have been reminded that Merit System Principles, Equal Employment Opportunity, and Veterans Preference Policies remain unchanged under NSPS. We are confident in our ability to successfully implement this new civilian personnel system with a view towards minimizing employees' concerns while maximizing their participation and acceptance. NSPS will provide COMPACFLT Headquarters with the modern human resources system we need to attract and retain the talent that we require. A core NSPS objective is to provide an environment where employees will be encouraged to excel, challenged with meaningful work, and ultimately recognized for their contribution. By aligning our individual objectives with Admiral Roughead's mission objectives, NSPS ensures accountability exists at all levels. Thank you again for the opportunity to testify. Senator Voinovich. Thank you very much. Now, you're the Deputy Chief of Staff for Total Fleet Force Manpower, for the Commander, U.S. Pacific Fleet. Are you a career civil servant? Ms. Kleintop. Yes. I'm a member of the Senior Executive Service. Senator Voinovich. OK. Ms. Kleintop. Yes. And my background, sir, is predominantly in human resources management over the period of the last 35\1/ 2\ years with the Department of the Navy. Senator Voinovich. So you've seen a lot of things come and go over the years? Ms. Kleintop. Absolutely. Not only in the civilian personnel sector, but as the de-cost, if you will, for total force management. Approximately 5 years ago, then Admiral Fargo gave me responsibility for the military personnel programs as well. Senator Voinovich. Thank you. Mr. Wataoka. TESTIMONY OF JEFFREY T. WATAOKA,\1\ DIRECTOR, HUMAN RESOURCES SERVICE CENTER PACIFIC, DEPARTMENT OF THE NAVY Mr. Wataoka. Good afternoon, Senator Voinovich and Senator Akaka. I am Jeffrey Wataoka, Director, Human Resources Service Center Pacific. We have a workforce of 62 employees, and are one of seven HRSCs within the Department of the Navy. Our Headquarters is the Office of Civilian Human Resources, located in Washington, DC. Our Headquarters and all of our U.S. HRSCs are converting to NSPS as part of Spiral 1.1. I appreciate the opportunity to be here, to address how I helped prepare our employees for implementation of NSPS. --------------------------------------------------------------------------- \1\ The prepared statement of Mr. Wataoka appears in the Appendix on page 48. --------------------------------------------------------------------------- This September, I will have served in the Department of the Navy for 40 years. During my years of service in the human resources field, I've participated in many changes including those made under the Civil Service Reform Act of 1978. Effecting change is oftentimes challenging especially when the goals are significant and affect a wide variety of employees, and this is true of NSPS. From the outset, the Department of the Defense structured their plan to build trust and credibility with employees, and this is what I focused on, in the HRSC Pacific. NSPS--What's in it for employees? And four things come readily to mind: Recognizing and rewarding employees based on their personal contribution to the mission. Defining performance expectations between supervisors and employees. Encouraging employees to take ownership of their ownership and success. And promoting broader skill development and advancement opportunities in pay bands. To prepare employees for the transition to NSPS, I focused on three critical factors: Communication, training, and participation. I will now provide some details on each of these factors. First and foremost is communication, both oral and written. Face-to-face interaction, which started over 1 year ago, included ``all hands'' meetings conducted by supervisors and employees in our office to discuss proposed NSPS regulations and procedures. Employees also attended separate presentations and discussions with the Deputy Assistant Secretary of the Navy (civilian Human Resources); the Director, Office of Civilian Human Resources; and the Program Manager, NSPS Project Management Office; and also representatives from Demonstration Projects who have experience with the pay-for-performance system. Written material disseminated to the staff included NSPS regulations; the HR Primer on NSPS that highlighted key points on issues such as classification, staffing, performance management, compensation, and workforce shaping. We also shared newspaper articles that include information on pay issues, legal issues, and comments from employees regarding NSPS. Newsletters from the Deputy Assistant Secretary of the Navy, Office of Civilian Human Resources, as well as those that I issued at the local level were all disseminated to employees. So far, there have been 18 newsletters from the Deputy Assistant Secretary of the Navy. The most recent one is dated March 7, 2006. This newsletter covered such topics as facts about conversion, preparing for NSPS, and an update of training. Information on NSPS was also communicated to employees via various websites including those from the Department of Defense and the Department of the Navy. The Department of Defense website includes the regulations and frequently asked questions and answers. NSPS material was posted on our bulletin boards. I disseminated NSPS brochures to all employees, including those entitled ``Communicating With Your Supervisor,'' ``Focus on Performance,'' and the ``Role of the HR Practitioner.'' Video such as ``NSPS: Towards a Mission-Centered Workforce'' and ``Appraising Performance'' were shown to employees. Finally, key members of my staff participate on biweekly web-exchanges in which the latest status of NSPS is discussed and questions answered. The second factor is training. Training under NSPS is comprised of soft skills and technical training, and, because we're a human resources office, additional informal and formal training has been or will be conducted for employees. Soft skill on-line training in the Department of the Navy taken by employees included ``Coaching for High Performance,'' ``Listening Skills,'' ``Goal Setting,'' and ``Effective Communication.'' The technical training completed or scheduled to be completed for all employees by the end of this month is NSPS 101, which is an interactive web-based course, ``HR Elements for Practitioners,'' a 24-hour course, and ``Performance Management.'' Both the ``HR Elements'' and ``Performance Management'' courses are mandatory for all employees, including supervisors. Training that will be scheduled in the near future will include pay-pool management and pay-for-performance. The third factor is participation. Our employees have been involved in specific NSPS initiatives. Our Headquarters established teams with representatives from all of Spiral 1.1 HRSCs to provide input on how NSPS will be implemented throughout our Command. These teams provided input on proposed regulations, conducting joint training, and participating in focus groups for development of job objectives and implementation teams involving information technology, conversion, classification, and recruitment. Employees identified and documented the employee development needs and participated in developing their own performance plan. HRSC Pacific employees have conducted training for our staff, on human resorces elements for human resorces practitioners, and will assist in training on performance management. I expect our staff will continue to be involved in formal and informal NSPS training in the future. We have been actively engaged in ensuring all employees understand NSPS and the effect of this new system on their role in furthering our important mission. Personally, I'm excited to begin deployment of NSPS and am continually committed to open communication, training, and involvement of our workforce in NSPS. I believe our employees are well prepared for NSPS implementation and will soon embrace it as a means to improved performance. Thank you for the opportunity to testify. Senator Voinovich. Thank you very much for your testimony. Mr. Vajda. TESTIMONY OF MICHAEL L. VAJDA,\1\ DIRECTOR, CIVILIAN HUMAN RESOURCES AGENCY, DEPARTMENT OF THE ARMY, ABERDEEN PROVING GROUND, MARYLAND Mr. Vajda. Good afternoon, Chairman Voinovich and Senator Akaka. My name is Mike Vajda, and I am the Director of the Department of Army Civilian Human Resources Agency, Army's sole Spiral 1.1 organization. I would like to thank both of you, the Subcommittee and your staffs, for inviting me to discuss our preparations for implementation of NSPS. --------------------------------------------------------------------------- \1\ The prepared statement of Mr. Vajda appears in the Appendix on page 54. --------------------------------------------------------------------------- And as described in my written testimony, the Army is looking forward to using the many flexibilities offered under NSPS, to better care for our civilian workforce. Acquiring and sustaining a capable and focused workforce in these times requires a human resources system that is as contemporary as the challenges we now face. Our Spiral 1.1 participants are the members of Army's operating civilian human resource community. As a sole participant in Spiral 1.1, they will have the opportunity to learn NSPS firsthand and use this detailed knowledge to assist our commanders, managers, and employees who would transition in later spirals. The Army believes that effective communication is key to successful implementation of NSPS. We have consistently shared the NSPS message through an organized chain teaching program, orchestrated town-hall meetings, briefings, brochures, fact sheets, training bulletins, and dedicated websites. Perhaps our most effective communication tool has been our senior leaders, who have had the desire and vision to support this critical initiative, leaders who embrace change and guide their organizations and employees toward successful NSPS implementation. One of these leaders is right here in Hawaii, Major General Stephen Tom, Deputy Commanding General for Mobilization and Reserve Affairs, U.S. Army Pacific. Major General Tom was appointed by Lieutenant General Brown, Commander of the U.S. Army Pacific, to spearhead the transition of the civilian workforce to NSPS. Since assuming this role, Major General Tom had been actively engaged in communicating the significance and value of NSPS to Army leaders and personnel throughout the Pacific. This effort presented the unique challenge of reaching out to many different Army commands and activities, geographically disbursed, in Hawaii, Alaska, and Japan. Major General Tom more than met the challenge. He has implemented an NSPS information campaign that began in August 2005, and continues to reach employees, managers, and civilian and military leaders at all levels. Major General Tom chairs the U.S. Army Pacific Civilian Advisory Board, that addresses broad issues that impact the civilian workforce. He also serves as a member of Army's NSPS General Officer Steering Committee. He has used the employee and leadership feedback he has obtained, to inform and positively influence NSPS implementation issues in the Pacific and throughout the Army. I want to show you that the NSPS training delivery is well under way in the Army. More than 60 percent of approximately 2,400 Army's Spiral 1.1 employees have received formal training. Twenty employees here at Fort Shafter Personnel Advisory Center are in Spiral 1.1. Six of these employees have completed the official train-the-trainer sessions at Columbus, and will serve as NSPS trainers. The two supervisors of the 20- person advisory center have also been trained, as have the remaining employees at Fort Shafter. In summary, we are confident that the Army is well positioned to implement NSPS on April 30, both here in Hawaii and in our other Spiral 1.1 locations throughout the United States. The Army looks forward to the flexibilities that NSPS will provide us in our efforts to acquire, develop, and sustain a highly skilled and motivated workforce. We truly believe that it will enhance our ability to support the warfighter and their families, as well as allow us to better serve our Nation. I would again like to thank you for providing me the opportunity to share Army's NSPS implementation plans with you, and I would be happy to take any questions. Senator Voinovich. Thank you for that excellent testimony. I have to say that I'm very impressed with what all of you have said about the preparation that you have made. Mr. Vajda, is there any communication between you and other people in the Navy, Army, and the Air Force? I noticed you had a very robust way of preparing for this. Did you do that on your own or did you get some direction from another office, how did that work? Mr. Vajda. Yes, sir. Each of the components have a project manager for NSPS, Army, Navy, and the Air Force. They work together and work with the Project Executive Office (PEO). We basically have ``soft skills'' training on-line, very similar to the Army. In fact, we've trained over 5,000 of Army civilians on the on-line training and approximately 4,000 in classroom training on change management, setting performance objectives, and having effective performance discussions. So we do coordinate and work together. Senator Voinovich. So the initial information that was sent down through the ranks was the same information for all branches involved? Mr. Vajda. Very consistent, sir. Senator Voinovich. I was very concerned about the soft skills training because I think it is probably more important than going through the training manuals, videotapes, and websites--is it all more or less the same information? Mr. Vajda. Exactly, sir. And we track all accomplishments. Our training efforts are centrally managed at the department level, and we track every accomplishment. Our supervisors have to be certified in order to work on pay pools, or, actually rate employees' performance. Senator Voinovich. I have been concerned about training since I first took this chairmanship. Senator Akaka may remember that I sent a letter out to 12 Federal agencies and asked them how much money they were spending on training, because training is extremely important, so people know they have an opportunity to obtain greater skills and they are growing professionally. Of the 12 agencies, 11 said they didn't know, and one said they did know, but they wouldn't tell me. You have all been asked to do more training than you would be ordinarily requested to do. Do you have the necessary resources to do the training that you're supposed to do? Did you have to pay for this training out of your existing budget? What kind of consideration was given to your budgets in order to implement this new program? I'd also be interested to learn if the trainers of the trainers were employees of the Department of Defense, or were they from the private sector? If they were from the private sector, did you have to pay them out of your budget? Could all three of you please comment on this? Ms. Kleintop. I'll start by saying that, to the best of our ability, when we realized a year and a half ago, the huge investment in training that would be required, we have attempted to budget for it through the normal PBB process. Obviously, since it's event driven, we may not have it exactly right, but so far, so good. Senator Voinovich. In other words, because you recognized you had this new responsibility, you did allocate resources to it? Ms. Kleintop. We did, yes, sir. Senator Voinovich. Did you get any additional resources over and above the year before? Ms. Kleintop. I did not, no, sir. Senator Voinovich. So you cut back on some of your programs and decided to put those resources into NSPS; is that correct? Ms. Kleintop. I would say that's a fair assessment for the first year and a half, but now that we see the line of sight in terms of where we're headed, I think that's one of the advantages of going first as a major claimant, which we are, because the lessons that we take away, vis-a-vis what does this cost, we'll be able to plan for, as we implement for the remaining 18,000 employees that work for our Headquarters. Senator Voinovich. Do you anticipate asking for additional money over and above the budget that you received in the 2007 budget? Ms. Kleintop. Yes, sir. We will have to. Senator Voinovich. If NSPS is going to be successful, you have got to have the resources that are necessary for you to get the job done. Ms. Kleintop. Yes, sir. Senator Voinovich. Linda Springer is the new OPM director, and we have discussed personnel reforms similar to NSPS for the entire Federal Government. A key question is whether agencies will have the management capacity and resources to do this. Ms. Kleintop. Yes, sir. Senator Voinovich. So, successful implementation will rely in part on the budgets of these agencies, I think that's one of the things we have to pay particular attention to, that we don't ask you to do a job and then don't give you the resources to get it done. Because I've always observed that if you ask somebody to do a job and you don't give them the resources to do it, basically, you are telling them that you don't think very much of what you're asking them to do. Ms. Kleintop. That's right. Senator Voinovich. So, that's good. Mr. Wataoka, same question. Mr. Wataoka. Yes, sir. First of all, Senator, all of our training course is captured, and we're submitting our reports to our comptroller located in Washington, DC. No additional supplemental funds were provided to us. However, I see NSPS as an investment, and if I can just use one data point, under the current general schedule system, there are 400 OPM classification standards. Under NSPS, there will be only 15. So I can see that there's going to be tremendous amount of savings on our part, when we implement NSPS. It will be simpler and much more timely and less effort involved by our staff in the future. Senator Voinovich. Does you agency use category hiring instead of the ``Rule in Three?'' Mr. Wataoka. Category ranking, sir, is that what you're talking about? Senator Voinovich. Yes. Mr. Wataoka. Yes, sir. Senator Voinovich. So now you have a larger pool of applicants than you can review, and that's going to help save time? Mr. Wataoka. Absolutely, sir. And we also have numerical ratings. We have both, numerical and categorical, yes, sir. So we see tremendous savings for us in the future. Now, we are human resources, so we will be directly impacted. Senator Voinovich. OK. So that's good to hear. Mr. Vajda. Mr. Vajda. Sir, in the Army, we've centrally managed the training requirement, the technical training requirement for NSPS, the training that our employees, our supervisors will need to understand and execute their roles in the NSPS environment. I personally briefed at the Pentagon the requirements--the budgetary requirements to train our workforce, both supervisors and managers, current year through 2009. That budget was recognized as a must-paid bill. Of course, a year of execution, and this year, basically, we're in an unfinanced requirement, this mode where the Army looks for money to pay that bill, but recognizes it as a bill. So it's centrally recognized within the Department of Army that we must do this, that a certain amount of dollars are allocated to do that, and we're hoping to get the--in our palm years, 2008 through 2013, it recognized as an additional requirement for those years. Senator Voinovich. OK. So you have your own budget for the Army, and you have yours? Ms. Kleintop. For COMPACFLT, right. Senator Voinovich. But certainly, the Department itself is going to have some real input into this decision making. I'm going to talk to Gordon England about this, and he has understood this process from the beginning. Senator Akaka, we have 10-minute question periods and I've used 11 minutes. Senator Akaka. Senator Akaka. Thank you very much, Mr. Chairman. I again want to express my gratitude to our witnesses for being here and also sharing--and I am smiling as I say this-- your 30, 35, and 40-plus years of service. I look forward to hearing your thoughts. I want to ask Ms. Kleintop and Mr. Wataoka, as Federal employees living in Hawaii, about non-foreign COLA. I understand that COLA, which is an allowance, has been given to Federal workers living in noncontiguous areas and in U.S. Territories since 1949. Under NSPS, pay raises will be based on five possible factors, including what is called ``local market supplemental adjustment,'' which will take the place of locality pay. Obviously, DOD employees in Hawaii are wondering how COLA fits into NSPS, and how COLA and local market supplements will interface. Moreover, COLA is protected under NSPS and cannot be waived by the Secretary. Ms. Kleintop, would you please describe what will happen to those receiving COLA as they convert to NSPS? Ms. Kleintop. Sir, as you said, and it is a fact, the NSPS legislation does not affect Title 5 that provides us the non- foreign COLA If I might, though, comment, as early as the town- hall meeting, 2004, with Ms. Adams, this was a large concern on the part of the local constituents, so much so, that since we hosted Ms. Adams, I immediately identified this issue to Mary Lacy, and she established that obviously NSPS would not impact that entitlement. However, what I further asked her to do, and they did promptly, was to make that a matter of record on the website that they were setting up, so that all of our constituents here would understand, because quite frankly, the people at the town-hall really were wishing that NSPS would change the existing legislation on COLA to enable us to receive the locality pay. As we transitioned into NSPS, as you've mentioned for those that receive locality pay, that will be part of that conversion and taken into consideration. Here we, in fact, will continue to receive COLA As far as the local market supplement, though, I can't explain precisely how that will proceed, because that is something that we're looking forward to, in the future, I would expect that the COLA surveys, as we know them, will continue, and I would be projecting, but I would think that the local market supplement surveys would have to take into consideration the fact that we do receive COLA And I will yield to Mr. Wataoka in case I've left something out. Senator Akaka. Thank you. Mr. Wataoka. Mr. Wataoka. Quite a complete answer, Senator. We did host Ms. Adams', the Deputy Assistant Secretary of the Navy, visits to Hawaii, and it was held in the Pearl Harbor Naval Base, with over 200 employees. This question came up from a number of participants in the audience. She did go back and she did address this answer on the website. It was actually Question No. 18, because I received it and disseminate it to our staff and our service activities. So, I think that was a complete answer by Ms. Kleintop. Senator Akaka. Will Hawaii employees be disadvantaged in any way if they don't get local market supplement? Mr. Wataoka. They would, in the sense of retirement. We know that COLA doesn't count toward our retirement, but that's subject to a separate lawsuit that's ongoing now, sir. Ms. Kleintop. I think, Senator, you've hit on the crux of the issue, and that is the disadvantage, if I can call it that. That is we receive the COLA and not locality pay. Like some of the Kona's locations, locality pay is computed currently into your retirement annuity. And, basically, I go back to that was the point at the town-hall, that many people were hopeful with the NSPS legislation, that legislation could rectify that inequity, if you will, and clearly, it does not change that. Mr. Wataoka. I'd like to add one more comment on that, Senator, if I may. Senator Akaka. Yes. Mr. Wataoka. I'm not sure that all employees would agree that there would be a disadvantage. Only in the sense with cost-of-living allowance, there's no taxes paid. So, many of the new employees may not want it. I don't know, I didn't ask everyone, obviously, but I think if you're looking at long-term retirement, then it doesn't count toward your annuity, the cost-of-living allowance. Senator Akaka. Well, I would really appreciate your continuing to work on this, to be sure it's clarified, and there's an understanding and even a resolution as to what it's going to finally be. Mr. Wataoka. Yes, sir. Senator Akaka. And I think the workforce would really appreciate that. Ms. Kleintop. Sir. Senator Akaka. So let's continue to work on that. Ms. Kleintop, we know that the departments and components will fund training for NSPS from existing funds. However, as you know, Pearl Harbor Naval Shipyard is mission funded. How is the Shipyard paying for the NSPS training programs, and if the Shipyard is not receiving additional funds from DOD for NSPS, how is Navy balancing NSPS training with other necessary employee training programs? Are existing programs being scaled back or eliminated to cover the cost of NSPS training? Ms. Kleintop. Sir, I would like to take that question, for the record. To my knowledge, a formal training has not started at the Pearl Harbor Naval Shipyard. However, I believe that question would be best answered by NAVSYS Systems Command. Because as you stated in your opening remarks, though it is mission funded and COMPACFLT Headquarters is the budget- submitting office for the Pearl Harbor Naval Shipyard, the shipyard--excuse me, NAVSYS has taken a one-shipyard approach in terms of NSPS implementation. We agreed to that at the outset. And so I don't feel that I could give you an adequate, precise answer on your question. Senator Akaka. Well, let me give Mr. Wataoka a chance, in case you want to say anything about that. Mr. Wataoka. I really have no comment on that, sir. Senator Akaka. Thank you. Mr. Wataoka, you have over 20 years of experience in the field of labor and employee relations, which makes you uniquely qualified to understand employee concerns over their rights and protections under NSPS. As such, I'm sure you will agree with the Federal Managers Association, that training managers and employees on employee rights will help ease concerns and create an environment focused on an agency's mission. Would you describe for us the training that employees are receiving on their rights and protections under NSPS, and how those rights under NSPS differ from a current law? Mr. Wataoka. We had several O.M. meetings where we discussed the proposed regulations. However, at the end, when I did address to my staff personally the adverse actions, the appeals, and the laborer relations portions, even though we do not have a bargaining unit, so I went over those provisions with them, but, of course, now because of the court decision, these programs are enjoined, and so we've stopped our training in these areas. There are provisions, however, for employees to contest certain actions on the current other systems regarding the appeal, the performance ratings, for example, so there are built-in protections for employees. Senator Akaka. Ms. Kleintop, DOD's training manual, HR Elements for Spiral 1.1 states that veterans' preference principles will be protected under NSPS. To me, the term ``principles'' is a departure from the clear statutory preference for veterans in hiring and protections during a reduction in force. Does the use of the term ``principles'' imply a change in veterans' preference rights under NSPS from current law? Ms. Kleintop. Sir, not as far as I'm advised. Obviously I was not the author of that particular manual, so I would have to yield on the use of ``principles'' versus the ``law.'' But, basically, what we've instructed is that veterans' preference will not be interrupted. Senator Akaka. Mr. Wataoka or Mr. Vajda, would either of you want to make a comment on that? Mr. Vajda. Sir, as far as I understand, the current rules regarding veterans' preference is maintained in NSPS, and it will continue without being impacted adversely. And I would just like to say that as far as the Army goes, our veterans are a great recruitment resource for us, and we value them as a component of the civilian workforce. Senator Akaka. Mr. Wataoka. Mr. Wataoka. We would administer reduction in force for our service activities. There are four factors that would be considered, and in order, they would be tenure, veterans' preference, performance rating, and credible service. That's how it is under the current system, with the exception that credible service and performance ratings are flip-flop; that is, today, credible service overrides the performance rating. That will be changed under NSPS. But veterans' preference would remain the same under both systems, the current and NSPS. Senator Akaka. We need to clarify this, so that people will feel that they understand what is meant by veterans' preference ``principles,'' and I thank you for that. Senator Voinovich. Thank you, Senator. In terms of the veterans' preference, we held a very good hearing in Washington that was requested by Senator Akaka, and we heard from some of the organizations who weren't happy. Senator Akaka and I are going to send a letter to the Department of Defense and the Office of Personnel Management to get additional information. We are very committed to this particularly with our men and women coming back from Afghanistan and Iraq, it's really important. I never did get an answer because I didn't give you a chance to respond. Who was doing the training? Ms. Kleintop. If I might go first, we are doing it with in- house trainers, with one or two exceptions, and what I would offer to you, sir, based on our current experience, the way that NSPS is set up and the way that we're implementing it, based on our Commander's intent and Admiral Roughead's objectives, there is such goodness to using in-house people, if you can. Now, I realize at COMPACFLT, we're implementing 470 people. There are larger organizations that may not be able to humanly do that with their in-house talent, but the feedback and we have it from our flag officers, SESRs attending the training, is that they really like the goodness of the in-house trainers who know the command, know the people, encourage the openness, and basically have been with us for the last year and a half, getting ready, and that's real-time feedback to you, because this is going on, as we speak. Senator Voinovich. That's great. When we did our Quality Service Through Partnership training, which was Total Quality Management, Xerox Corporation was the one that really helped us. But eventually all of our trainers were Ohio government employees. When I left the governor's office, we had 3,500 continuous improvement teams, and we had 2,500 facilitators. These are all people that had taken time away from their regular jobs to participate, and it really, I think, is the best way to get the job done. The people in the Pentagon that are overseeing this program in Washington, DC, do you believe they've got the resources to oversee this? In other words, the P---- Ms. Kleintop. PEO. Senator Voinovich. Yes. Do you feel comfortable that they've got their act together and have the resources to get the job done? Mr. Vajda. Sir, from my perspective, they've done a very good job. Army, and I believe Navy and Air Force, all have representatives that work with the Project Executive Office, and we work very closely with them. We all have project managers, and we work as a team, basically. I've met with the OIPT and seen how Mr. Dominguez and that group, very carefully and exactingly, considers what they do and how we do it with NSPS. Senator Voinovich. So you feel very comfortable? Mr. Vajda. I do feel comfortable, sir. Senator Voinovich. Are they engaged and concerned? Mr. Vajda. They are engaged. Senator Voinovich. That's good. On the issue of the soft skills training, is that done in the classroom with people, or by a videotape or over the Internet? Mr. Wataoka. It's both, sir. We do have web-based training on a lot of it, and others are face-to-face interaction in classrooms. Mr. Vajda. Sir, we do both in the Army as well. We have classroom training that we offer at every installation, and we have web-based training, a wide variety of web-based courses that employees can take at their leisure. Senator Voinovich. Congress authorized 2 years ago that the Senior Executive Service would have a pay-for-performance system. Have all of the SES people in your respective offices gone through the pay-for-performance training and entered this system? How is it working? Ms. Kleintop. I can speak to that. We have four SESers at COMPACFLT, and, in fact, yes, we have been through one evolution on pay-for-performance. And actually, I think some of the things that were done for NSPS are helping to inform backwards how we can improve the transparency on that effort, but---- Senator Voinovich. That's great. I don't think there was this level of preparation for the Senior Executive Service. I don't think it was done. Are you saying that maybe that it didn't work out as well as you would like it to? Ms. Kleintop. I have no personal complaints, but I have heard people say that perhaps the transparency of the process was not as ideal as we feel it is right now for our people, but that's all part of transformation. And to answer your question, yes, in fact, one of our four will probably be the pay pool manager for COMPACFLT, and that's because of his experience working at the senior Navy level on the pay pool process back there, so we're trying to use his experience to do it at our headquarters. Senator Voinovich. Mr. Wataoka. Mr. Wataoka. I was going to make a comment about that. What I thought was interesting was the Deputy Assistant Secretary of the Navy, Patricia Adams, shared her performance objectives with all of us. My understanding is that performance management for the SES group has been successful. I've heard very favorable comments. Senator Voinovich. They feel good about it, overall? Mr. Wataoka. I can't answer that. I don't know. Senator Voinovich. You say it's been successful, but you're not sure? Mr. Wataoka. The people that I've talked to are happy that they've launched this. My boss is at least showing that they are leading the way, they're the senior executives, and she's willing to share her standards with us. I think that's making a statement, sir. Senator Voinovich. I'll be interested to hear from the representative of the managers on that one. Do you have any comment on this, Mr. Vajda? Mr. Vajda. I would just echo what Ms. Kleintop said, sir, and I do know that the OIPT, Secretary England and his group really did take a hard look at what happened with senior executive performance appraisal process and the lessons they learned there, and tried to apply that to NSPS. Senator Voinovich. Thank you. Senator Akaka. Senator Akaka. Thank you very much, Mr. Chairman. Having the three of you here today provides me with the opportunity to ask the question I've asked of DOD officials before, which is, what are the plans for converting Wage-Grade employees to NSPS? Has anything been developed for a potential conversion, and has there been any discussion on the application of the Monroney Amendment to Wage-Grade employee pay under NSPS? Ms. Kleintop? Ms. Kleintop. The details, as I know them, have not been developed at the DOD or Department of Navy level, but COMPACFLT obviously employs, throughout our areas of responsibility, many wage grade employees, two of the shipyards, and so, obviously, at my level, our line of sight and vision is that we will convert, we will implement NSPS for our wage grade employees. The original schedule, however, given the Spirals, was not to have that happen until Spiral 2.0. So, as to the further development and crystallizing all of that for the wage grade, I would have to take that for the record, in terms of the new schedule and the exact details that have been fleshed out. Senator Akaka. Mr. Wataoka, do you you have anything to add? Mr. Wataoka. Nothing significant, sir. I did attend a DOD meeting in which this issue was addressed, but I think as Ms. Kleintop said, it's in Spiral 2.0, which is sometime in calendar year 2007, so I haven't heard very much more about it, sir. Senator Akaka. Mr. Vajda. Mr. Vajda. Senator, I don't think I could add much specifics aside from the fact that I do believe that the principles and theories underlying NSPS would be equally applicable to our blue collar employees as they are to our white collar employees, and I know the intent is for this system to cover our wage grade employees as well. Senator Akaka. I have many other questions, Mr. Chairman, but I'll submit them for the record. However, if I may ask this one, Ms. Kleintop, our Subcommittee was told last November by Secretary England that 85 percent of NSPS training will be conducted on a face-to-face basis in the classroom. Is this the case, and have you evaluated which training, classroom or on- line, is more effective? Ms. Kleintop. All of the training that we have accomplished to date in the last year and a half, we have evaluated. There are built-in pre- and post-evaluations that are done. And what I stated in my testimony is that we have used a blended approach, because, quite frankly, we do have employees that do enjoy going to the website and taking advantage of those courses. But I would say in the main, our soft skill training, which was coaching for high performance, was all done in person, and obviously the training that we're conducting at this moment is all in person, and to his credit, Admiral Roughead has directed that all of this training will be required for all employees, managers, and supervisors, and so even though we are not directed that way, from DOD or Navy, he believes that it is that critical, that is basically what our metric is, as we speak. Senator Akaka. The question also comes because you testified that those without computers were given brochures for information on NSPS. I am interested in on-line training programs. What alternatives are in place to provide on-line training programs to individuals without a computer, and how many employees does this affect? Ms. Kleintop. Sir, I apologize if I misled you. I can assure you, all 170 employees at COMPACFLT Headquarters have not just one, but two computers, basically unclassified and classified. What I should have said more clearly is that this blended approach is allowing our employees to go to the websites on their own time to take advantage of some of the courses that are there, on the soft skill side, but in no way did that replace the formal classroom training that we are doing, and I apologize if I misled you on that. Senator Akaka. Thank you so much for your response. Thank you, Mr. Chairman. Senator Voinovich. Thank you very much for your testimony today. I must say that you have made me feel more confident about this system because of all the work that you've done in preparing for it. I think that you understand, as implementation continues, the level of effort needed to be successful, as well as the need for continuous training. Mr. Vajda, how long have you worked for the Federal Government? Mr. Vajda. Thirty-two years. Senator Voinovich. OK. I want to thank you all for continuing to serve your country at a very critical time. Your years of experience are important to the operations of the government. Mr. Vajda. Thank you, sir. Senator Voinovich. Will the second panel of witnesses come up, please. Before our witnesses sit down, I'll administer the oath. Do you swear the testimony you are about to give this Subcommittee is the truth, the whole truth, and nothing but the truth, so help you, God? Thank you. Please have the record note that all witnesses have answered in the affirmative. We're very fortunate today to have representatives from three organizations. We have John Priolo, the past President of Chapter 19 of the Federal Managers Association. Mr. Priolo, Senator Akaka reminded me, has testified before us previously. Benjamin Toyama is the International Vice President, Western Federal Area of the International Federation of Professional and Technical Engineers, AFL-CIO. Don Bongo is the Vice President of the Hawaii Federal Employees Metal Trades Council, AFL-CIO. Thank you very much for being here today to share your thoughts, we welcome them. Mr. Priolo, we'll start with you. TESTIMONY OF JOHN C. PRIOLO,\1\ RETIRED PRESIDENT, CHAPTER 19, PEARL HARBOR NAVAL SHIPYARD, FEDERAL MANAGERS ASSOCIATION Mr. Priolo. Thank you. Chairman Voinovich and Senator Akaka, it's good to see you both again, and thank you for inviting me to be here today to talk about the roll-out of NSPS and its impact on managers and employees. You already have my detailed written testimony, and I'll just hit some of the high points. --------------------------------------------------------------------------- \1\ The prepared statement of Mr. Priolo appears in the Appendix on page 60. --------------------------------------------------------------------------- I'm a Retired President of FMA's Chapter 19 at Pearl Harbor. I was also a past Zone 7 President, responsible for chapters in Hawaii and portions of the West Coast. I spent almost 40 years in Federal civil service, most of which was in the nuclear engineering department at Pearl Harbor Naval Shipyard. And I'm here to testify today on behalf of the DOD managers, supervisors, and employees throughout the Department. FMA was established in 1913. It's the largest and oldest of managers and supervisors associations. It originally was organized within the Department of Defense, and since, it's branched out to include 35 different Federal departments and agencies. So what happens at DOD is going to affect all our people and we're vitally interested in being a part of it. We're a nonprofit advocacy organization and our job is to promote excellence in government. I'm very pleased to be sitting next to my good friends, Ben Toyama and Donald Bongo. When I was actively working at Pearl Harbor, we worked very hard with our unions to build strong relationships, and they are superb voices on behalf of their membership, and, frankly, without their help and guidance, and of course the support of our Congressional delegation, Pearl Harbor would not have an apprentice program. The development of a new personnel system at DOD is a historic step in the history of civil service. Because of the critical mission and the sheer size of the DOD, success is vital. As those who will be responsible for the implementation of the Department's proposed personnel system and subjected to its changes, managers and supervisors are pivotal to ensure the success. We believe this hearing is most important as we sit on the precipice of the first wave of employees being enrolled in the new system at the end of this month. We support the message of the system to institute flexibility, accountability, and results. We also recognize that change does not happen overnight. Managers, supervisors, and employees throughout DOD await a system that many question whether it will actually come to fruition. Their skepticism is rooted in a lack of adequate communication that clearly indicates the expectations and time frame for training and employing enrollees in the new system. Despite such concerns, men and women of the defense workforce are committed to meet any challenge head-on, and we are still optimistic that the new personnel system may bring together the mission and goals of the Department with its on- the-ground functions. One of the greatest challenges we see is that managers and supervisors are clueless when it comes to the new system. The communication coming down from agency leadership on time frames and expectations isn't nearly enough to find managers, supervisors, and employees prepared for their role in the new system. Voluntary Internet-based soft skill training has been offered, but little accountability or time has been made available for managers to prioritize that training. Spiral 1.1 is expected to be implemented at the end of this month, and training programs have only recently begun for those members. We encourage that NSPS scale back the overall implementation, but information people are receiving on the ground remains too elusive. We've extended our publications, our conferences, and, in fact, our local chapter meetings as mechanisms to educate employees, but these only capture a small percent of the supervisory workforce even among our membership. We are thankful that many of our members have taken advantage of these opportunities, and we are pleased with the information coming out of the Program Executive Office. But we believe more needs to be done throughout the chain of communication, from the secretary on down, to keep managers, supervisors, and employees engaged in a roll-out assessment and analysis of the system. Concern also remains about funding the pay-for-performance system. We reiterate that without proper pay, it's impossible for a manager to adequately compensate an employee for their performance. Most of our members will be enrolled in Spiral 1.3. We hope that as the system moves forward, we will see greater efforts on behalf of the Department to engage and educate the managers and supervisors on their expectations. They are up to the challenge. They just need to be aware of when and where they need to step up to the plate. I'll just add, I know some of the trainers that the shipyard will use. They're good people, experienced trainers and know the culture of the organization that they're going to train. And I'm cautiously optimistic that the support will be there, but I do guarantee you that if the support is not there, Mr. Chairman and Senator Akaka, you will hear from us. Thank you again for allowing us to be here, and I'd be happy to answer any questions that you may have. Senator Voinovich. OK, you are saying most of your people will be in Spiral 1.3. When does that begin? Mr. Priolo. Does somebody have a time limit for that? I think the date keeps moving. That's why I don't have an answer. Senator Voinovich. OK. The question I have is, how many people in your organization are in the 1.1 Spiral? Mr. Priolo. Very minimal. These would be headquarters-level people and we don't normally represent any of those kind of people, so, absolute minimal. Senator Voinovich. All right. Thank you. Mr. Toyama. TESTIMONY OF BENJAMIN T. TOYAMA,\1\ INTERNATIONAL VICE PRESIDENT, WESTERN FEDERAL AREA, INTERNATIONAL FEDERATION OF PROFESSIONAL AND TECHNICAL ENGINEERS, AFL-CIO CLC, AND VICE PRESIDENT OF IFPTE LOCAL 121, PEARL HARBOR NAVAL SHIPYARD Mr. Toyama. Thank you. I would like to extend a special note of appreciation to you, Chairman Voinovich, for your foresight in holding today's hearing in Hawaii. I know I speak for all the workers here at Pearl Harbor Naval Shipyard, and I extend to you a warm aloha and welcome. --------------------------------------------------------------------------- \1\ The prepared statement of Mr. Toyama appears in the Appendix on page 79. --------------------------------------------------------------------------- I want to also extend a very heartfelt note of appreciation and aloha to Senator Akaka. Senator Akaka's outstanding efforts in Congress over many years, including his most recent efforts to bring fairness and equity to the NSPS, is not only important to the workers here in Hawaii, but to all DOD workers worldwide. Senator Akaka, mahalo and thank you for giving me this opportunity to testify. I will deviate a little from my written remarks, to address a subject of today's hearing, ``Preparing for Transition: Implementation of the National Security Personnel System.'' This leads me to ask the following question: How does DOD and OPM plan on implementing a system that has largely been ruled as illegal by a Federal court and has absolutely no buy-in from the very workforce it will impact? The employees that we represent and the supervisors that work with our members all hear our frustration, the union's frustration with the DOD, and their refusal to honestly consider the proposals put forth by the United DOD Workers Coalition. The implementation of the NSPS will be very difficult and painful because of the failure of DOD to at least try to get any buy-in from the State COLAs, the employees. It appears that DOD believed that they could fast-track the NSPS and go through motions of meeting and considering the comments of the unions and force a failed system on the employees. This scheme, this trick, did not work because the courts have ruled the actions of DOD illegal, and the capricious nature of the implementation of NSPS has gone to a halt or at least significantly slowed down. This failure of DOD to honestly address the concerns of the Federal employees, and the arbitrary and capricious rules that they tried to use to implement the NSPS breeds mistrust and contempt of the NSPS by all of the employees affected by the NSPS. Without trust, the NSPS will fail to produce any gains, and, in fact, produce terrible results for DOD. The unintended consequences of NSPS will make it less productive in the workplace, because it will destroy teamwork and will cultivate a cultural silence. This would adversely affect safety and productivity. Morale, productivity, and efficiencies will suffer because of lack of trust and training under the pay-for-performance rules of NSPS, when ensured. And the pay-for-performances of the managers will not be able to properly implement a fair system. Senator Voinovich, you spoke of TQM and your efforts as a mayor, I applaud you for that. The unions have been always interested in Dr. Demmings, and TQM, and TQL. I have been involved in that since 1985. Currently in the Pearl Harbor Naval Shipyard, we're spearheading the union, is spearheading the team of employees to train and teach productive improvement, according to Steve Covey's ``8th Habit,'' how to find our voices and inspire others to find their voices, from effectiveness to greatness. And we are pushing this and we're talking about teamwork. Pearl Harbor Naval Shipyard has a tiger-team concept that is the best in the country. We change batteries, the best in the country. We've done work on the USS San Francisco after it hit an undersea mountain, and we worked that as a tiger team. We believe that the NSPS and the pay-for-performance system will destroy the concept of teamwork, because we compete against each other for the pool of funding and we compete against each other for the performance rating. The bean counters and the ratchet counters will be forcing the employees to stop working as a team and start to work as an individual to increase the opportunities for promotions and things like that. We have a nuclear safety program in the Navy that places a premium on safety and quality. NSPS places a premium on performance, which is measured by cost and schedule. The NSPS will cause employees to make hard decisions to report a quality or safety defect or take a chance and not report the defects, because the requiring of a defect could adversely affect the employee's performance. This will sure lead to a culture of silence that the NASA auditors found in NASA. We are very concerned about that cultural safety and the safety problems when that happens. We lost a Hawaii astronaut, Ellison Onizuka, in the Challenger space shuttle disaster, and we think that pay-for-performance will drive some safety problems in the nuclear program. NSPS is a bad policy intended to promote a DOD strategy that would take away employee rights at the workplace. NSPS will render moot current laws regarding EEOC and discrimination, the Whistleblower Protection Act. It will render moot veterans' rights regardless of what they have told you, and the other employee appeal systems. The reason I say that, is because the penalty of reporting a manager or your own supervisor for fraud waste abuse, discrimination, sexual abuse, or any other wrongdoings will impact that employee's paycheck and his career, unless he hits a home run and proves that manager is wrong. We have seen EEO complaints go on for 5 to 7 years with adverse conditions to the complainant. We have seen whistleblower protection on problems when someone proposes to report fraud, waste, and abuse in the current system. And unless everyone finds religion, we will have a very difficult time separating reprisal from the pay pool and pay-for-performance, and that's how we feel about this. Regarding the veterans' rights, they have not changed the rules regarding the veterans' rights, but what they had done is changed the area of consideration. So veterans have no right now to bump and retreat, as they did in the past, the positions that they qualified for. The bumping and retrieving rights for veterans will be gone, and that rights greatly diminish the rights that all veterans enjoy under the current law. We think, we believe, had DOD worked with the union and the United Defense Workers Coalition and properly taken our input and our proposals, we could have made a difference and we could have, in fact, looked at the pay-for-performance system and NSPS system, that would probably work better, but without the trust, I would suppose that your experience with your own employees, as mayor, taught you that without the trust of the employees, everything goes slower, everything is difficult. We have had no contact or discussion with regards to all of the plans that DOD wants to implement in NSPS. Thank you for giving me this time to testify. Senator Voinovich. Mr. Bongo. TESTIMONY OF DON BONGO,\1\ VICE PRESIDENT, HAWAII FEDERAL EMPLOYEES METAL TRADES COUNCIL, AFL-CIO CLC, AND SERGEANT FIRST CLASS, E-7, HAWAII NATIONAL GUARD, 227TH ENGINEER COMPANY (COMBAT), 29TH BRIGADE Mr. Bongo. Senator Voinovich, thank you for coming all the way down to Hawaii to listen to our testimonies. To my dear Senator Akaka, thank you for serving the great people of Hawaii, with your warmth and aloha, with true spirit, and I thank you. --------------------------------------------------------------------------- \1\ The prepared statement of Mr. Bongo appears in the Appendix on page 86. --------------------------------------------------------------------------- I have made a statement of my testimony and I would like to give it as evidence to you guys, but, basically, what I want to do is enhance this and say a thing that's been on my heart. I've been involved in the coalition of unions in Washington not only with Ben Toyama, but President Ron Alt, in what we call the meet-and-ignore sessions that we had up there to discuss the system that would ensure security of our Nation. I've attended most of those meetings prior to me being mobilized with 29th Brigade Combat Team, August 16, in the year 2004. Yes, I am a Federal worker for Pearl Harbor Naval Shipyard, going on 25 years, but I'm also a proud citizen soldier for the State of Hawaii and for this great Nation. And what I would like to say, my dear Senators, is that it wasn't too long ago that State of Hawaii, while we were a State at that time, that we were attacked. And as I recall President Roosevelt saying at that time, ``a date which will live in infamy,'' we will not forget for the many thousands of lives that our sailors had given that day, and yet vowed that it would never happen again to this great country. Sad to say a few years ago, we were attacked again, and many innocent men and women, the World Trade Center, Pentagon and the fields of Pennsylvania, lost their lives, and their families were greatly impacted, and till today they still mourn their loss. I say that to remind us because it wasn't too long after that, that we started to meet and confer on a system that was supposed to be protecting or keeping our America safe, a system that would ensure that it would not happen again. But at that time, hundreds of thousands of American women, men and women in our Armed Forces volunteered to fight, to get involved and fight the bad guys out there. Hundreds of thousands of men and women decided that they wanted to get involved as civil servants, like myself, in that fight. I was based out in LSA, Anaconda, right outside of Balah, where we were mortared just about every day by 6-round Charlie. I had the pleasure to help fortify the base, to keep it safe for the American soldiers within that compound. I got involved with the election process by helping the poling station, keeping them safe by putting up barriers. I worked with the Iraqi army and I worked with the Iraqi police. During that time, there were many situations on a daily basis while I was outside the wild, me and my soldiers were encountered by the children of Iraq, and all they wanted was water and food. And I can recall one day sitting back in our hooch, sitting down with our men, after a mission, and one of my young soldiers, about 22 years old, came up to me and said, Sarge, do you see the children over there? Do you see them, the same clothes from the first day we came, at 137 degrees, same clothes. All they want is water and food. And another soldier told me, Sarge, how can a government treat their people like that? With the amount of monies that they have. And I say this because I want to remind everyone here that the men and women in our Armed Forces volunteered to help fight this cause, that the men and women in the Department of Defense as civil servants want to help the men and women in the Armed Forces to accomplish that mission. We cannot take away their rights. A lot of them were veterans that fought. Myself and Brother Tommy Miguel, are veterans of the Vietnam era, and sometimes we say we kind of feel guilty coming home when we know men like Staff Sergeant Wilgene Lieto and Specialist Derence Jack, from Saipan, of the 100 Battalion 442nd Infantry, that pulled security for me and my men to help the people of Iraq through the election process. On a sad day in October, they were killed in IED. Senator Voinovich. Mr. Bongo. Mr. Bongo. Yes. Senator Voinovich. You have exceeded your time, and if you could wrap it up, please. Mr. Bongo. All I'd like to say, sir, is that what we need to do with this system is remember why the people are getting involved in the Department of Defense, both civilians and military. Thank you. Senator Voinovich. Thank you. I'd like to make a couple of comments. First of all, Mr. Toyama, I'm very excited to hear about your tiger teams. We have DFAS in Cleveland and they had a real problem with processing claims, they put a tiger team together and it reduced the processing time significantly because they went to the employees and said, ``How do you feel you can get the job done better?'' I'd be interested if you'd send me some information about what you have accomplished, I'm very interested in that. Second of all, it puzzles me that you don't have information about the program. However, the program will be implemented first for the white collar workforce and then for the blue collar workforce. Mr. Priolo, you noted that just a few of the people you represent have gone into the system. I believe that the Department of Defense will continue to do the same kind of outreach that they've done with the Spiral 1.1, that they're going to do the same thing with the next spirals, and they may even do more, because of the concerns that Mr. Toyama has raised. Another issue is that part of this system is being contested in court. The unions argue that wages is something that should be bargained, and the labor-management rules are in court, and we may not know the decision for some time. The courts decision may impact the unions. So I just want to mention that. Were you impressed with what you heard here from the first panel about the training and everything that they did? Mr. Toyama. I heard Mr. Wataoka and Ms. Kleintop, I've known them for most of their lives. I've got 40 years in the shipyard. Also, I've worked with them. I taught Jeff everything he knows. Let me say this: We represent the people and we're the voice of the membership. And it is very disturbing to us that we have Spiral 1.1, senior executive members, and non- union members be the representative of choice for our membership and my union to determine how good and how well a program runs. I don't think it's fair to me, I don't think it's fair to my membership, that the representative of choice that DOD selected was all non-union people and managers to determine how well this is, how well liked it is, and how well received by the population and then put this on us. Senator Voinovich. The Department of Defense has delayed implementation of NSPS multiple times. They could have implemented it much sooner. Senator Akaka, myself, and other Members of Congress, insisted that implementation not be rushed. Now, is that the process that you're talking about, or is it a process that was subsequent to that? Mr. Toyama. That's the process I was talking about. It was not vetted properly. Senator Voinovich. So you feel that it was not vetted properly because the people that they selected to represent the wage workers were not union representatives? Mr. Toyama. No. What I'm saying is, the United Defense DOD Worker Coalition was all union representatives, and I was part of that. But none of our proposals, none of our concerns, and none of our counterproposals to management's proposal on the table was even applied and/or considered. They listened to us and they ignored us. Then I said to you that we have heard testimony that Spiral 1.1 has been taught and trained, and everyone likes it, and it's wonderful and everyone is excited about Spiral 1.1. But what it does, it sets the parameters and it sets the action for Spirals 1.3 and 2.0, and all the rest of the Spirals that follow Spiral 1.1. And they are the representative voice in terms of correcting or, in fact, making sure that the NSPS is proper. In that representative voice that will drive and, in fact, steer all of NSPS, there's not a single union member or representative. It's all managers and senior managers. To do Spiral 1.1, they're going to convince Congress, me, my grandmother and everyone else how wonderful it is, but there is not a single employee voice in that crowd. Senator Voinovich. Now this was before the lawsuit was filed? Mr. Toyama. Yes. But I think the spirals was already planned that way. They were going to go before the lawsuit was filed, Spiral 1.1. Senator Voinovich. So prior to the lawsuit being filed, the development of NSPS did not involve union representation? Mr. Toyama. Correct, it did not. Senator Voinovich. OK. I genuinely believe that it's in the best interest of everyone that we go forward with NSPS. I was impressed with your testimony about your TQM teams because you do want to have camaraderie. As a matter of fact, in the State of Ohio, we used to award individuals if they came up with a new idea that would save money for the State. But when we adopted Total Quality Management, we reevaluated that, so that the teams ended up getting the money. And there isn't any reason why, as we move through the implementation of NSPS to make some accommodations--it's not cast in stone. Regardless of the outcome of the lawsuit, I would encourage you to make suggestions to the Defense Department on changes they could make to NSPS to give you more confidence in the system. I would be interested in knowing your ideas too. At the hearing we had on veterans' preference we learned something from the people that represent veterans, and we're going to take action as a result. So I just want to say to you that NSPS is not cast in concrete, and there are changes that can be made to the system that will better accommodate some of your concerns. I would also mention that I asked if managers were evaluated on enforcing veterans' preference. The answer was no. I was a proponent of affirmative action, and a lot of people that worked for me weren't really supportive of affirmative action. I made supporting affirmative action a criteria of their performance evaluation. My staff knew that was very important to me, as a mayor of Cleveland and the governor of Ohio. I think that if this system is implemented right that it could make things better for your members. I know you feel that NSPS is bad, but I'm saying to you that you need to continue the dialogue and provide your input to the folks in Washington. Mr. Toyama. Yes. Let me tell you about the union's passion and drive with regards to productive improvement and Steve Covey's ``8th Habit.'' In the BRAC hearings, they compared Pearl Harbor to Portsmouth Naval Shipyard, and Portsmouth Naval Shipyard was deemed the goal standard of labor relations and productivity. We, in Pearl Harbor, the workers in Pearl Harbor took personal umbrage to that, and we are working hard to show them the platinum standard. We will rise above their standard, and we will compete and we will be good. We understand that and we'll do that, maybe in spite of NSPS, I understand that. Federal employees are volunteers, like Mr. Bongo said, we volunteered to keep fit to fight, we volunteer to make sure our military are well prepared to fight any war that we need to fight, and we're volunteers. I'm just saying that it sets us back from all of those things we are attempting to do now, because there's not transparencies, there is not clear communication, and I think the stakeholders are cut out of the planning session of this NSPS. Senator Voinovich. Thank you. Senator Akaka. Senator Akaka. Thank you very much, Mr. Chairman. I want to recognize this panel of friends who have been active in trying to make sure employees understand NSPS and have provided great ideas and suggestions to improve NSPS. I want to thank all three of you for your tireless efforts on behalf of the DOD workforce, and I want you to know that your work has not gone unnoticed. Mr. Bongo, I thank you for your service to our country, as both the combat veteran and a career Federal employee. You testified that NSPS will significantly diminish veterans' preference, especially in the event of a reduction in force. How would you strengthen veterans' preference under NSPS? Mr. Bongo. Senator, basically, I'd like to strengthen the veterans' preferences by keeping it equal, to remember why these men and women were veterans. They served our country, they deserve their right to be treated equal, especially in the rift during a reduction in force, to continue to serve as a civil servant without any prejudice. Senator Akaka. Mr. Toyama, do you have anything to add to that? Mr. Toyama. I would think that the veterans' preference should remain the same as they have it now. The problem with the NSPS is they have taken, say, shop of welders, of 150 welders, they now have the ability to narrow the area of consideration in the reduction in force to a work area that would encompass maybe 25 of the 150 welders. Now, if a veteran was promoted to become a special nuclear welder, for instance, and they need to cut back on nuclear welders, he had no right to return to his regular welding job, which would be a grade level below him, if that work area was not affected. He had no right to bump and/or retreat to any job that he qualified to, because they have agreed and NSPS allows management to narrow very limited areas in term of reduction in force. It used to be where throughout the activity, a veteran had the right to retreat or bump throughout the activity any position that he came from and/or was qualified for, and that right or that privilege is gone. In our discussion with Mr. Nesterczuk in the meet-and-confer process, we asked him about that, and he's---- Senator Voinovich. Mr. who? Mr. Toyama. George Nesterczuk, OPM. Senator Voinovich. Thank you. Mr. Toyama. We discussed this. And I'm a Vietnam vet, and I told him that if I'm a vet, and I was in fact impacted, and Don Bongo was ready to deploy, like Don Bongo goes and deploys and come back, and he is affected, because he's a special welder, why wouldn't we accommodate him? And the answer to us was, we don't want to disturb or inconvenience 3,000 employees in Pearl Harbor Naval Shipyard for a vet that maybe is being affected in a rift. And I told him, ``Look, you inconvenienced me for a year. I dodged bullets out in Vietnam for a year. You put me in mud paddies for a year. You get Don Bongo in Iraq Desert for a year, you inconvenienced him and his family, and you don't want to inconvenience the people that stayed in home? He said, well, that is the reason they narrowed, very narrow scope of where a veteran can retreat and bump to. The trick is, they did not change the veterans laws, but they changed all the employment laws around the veterans laws. Same as the Whitman amendment. A person can come in and get promoted and pay raises ten times a year. Every time he's temporary, assigned to a job at a higher pay rate, he can accumulate that higher pay rate or move to a higher pay band and accumulate that, and if he is reassigned multiple times during the course of the year, his pay raise will go up multiple times through the course of the year. Now, the Whitman amendment was put in, in 1952, to avoid that. The rules currently says you spend a year in the grade level, the pay level, at the grade below the level that you'd be promoted to. But you had a year wait, then you move to the next step. Not anymore. They can do ten steps in a year. And that opens the door for a lot of unfairness, and we sit here and we say, look, if there is complete trust, maybe with the amount of trust we have now, that's a bitter pill to swallow, that they will do the right thing at the right time, for right reasons at this time. And it's a tough sell for us. Senator Akaka. Thank you, Mr. Toyama. Mr. Priolo, I understand that several members of your chapter just returned from the train-the-trainer events. Can you share with us whether those who attended feel better prepared to train other employees, and have they discussed with you whether they would like additional training? Mr. Priolo. Discussions were limited, but the training that they have indicated has been very effective. And additional training will be needed to continue through the process, because it can't be one shot. It's got to be a continuous improvement. And as I said, I'm optimistic, as long as the support, which means funding and train-the-trainer training continues, and as long as, by far, almost all training is done in a classroom atmosphere as opposed to some on-line training. In my opinion, one of the most difficult jobs for any civil servant is a first-line supervisor in a shipyard. He or she is expected to be on the deck plates for many long hours. They come in early, they work through lunch and they stay late, and they're not always compensated for it, and to expect them to then find a computer and do on-line training, well, it's not going to happen. But if you use classroom training as the major vehicle, with the excellent trainers that we have in place, then that supervisor's job for the day is to go to training. In fact, if I could be king of this program for a day, I'd make sure that any training of Pearl Harbor supervisors occurred off base. Maybe we'd send them to the Hickam theatre or the submarine base, so they're not going to be constantly bombarded with cell phone calls and pagers going off, so that they could absorb the excellent training that's provided. And that's what my complaint is about--I've taken on-line training before, and it can supplement, but it can never, ever replace classroom training. Senator Akaka. Thank you very much, Mr. Priolo, for that. Mr. Chairman, my time has expired, and I have questions that I'd like to submit for the record. Senator Voinovich. OK. Senator Akaka, if you have a couple more questions that you'd like to ask, that would be fine, and then you could also submit questions for the record. All I can say in conclusion, I'd like to continue to hear from you. Mr. Toyama. I will send you all of our program data to show what we have done on productive improvement, and I am so proud of that program, I'll tell you this: We took a 400-manhour job, we had three people work on it for 9 hours. Three meetings. Monday, Wednesday, and Friday, we implemented, we completed that job. Now in Pearl Harbor, it become an 8-hour job. From 400 manhours to 8 hours. This is the creativity and the ability of the worker out there, if we ask them and empower them, and this is what we have done, but it takes teamwork, it takes lot of risk management, and sometimes it affects productivity and performance. Senator Voinovich. Every year we held an event called ``Team-up Ohio,'' and we would bring the quality management and improvement teams to Columbus, we would take over the whole convention center. Every team had a booth and they would describe what they did and how they did it. It was one of the best days I had, seeing the pride of the people that worked for the State, learning about their ideas and how they were making a difference. People started to really feel good about what they were doing, and they were participating. This is just a suggestion, maybe you ought to do it here and celebrate what you've done and let people know about it. Mr. Toyama. We plan to do that on July 20, do a presentation, at Old Dominion College, and we will come to Washington. If you have 2\1/2\ hours you can schedule, we'll give you a presentation of what we have. We have put together a traveling show. And the important aspect of this whole deal is this. We, the old guy in the shipyard, I got 40 years there, picked up these people, this team that's 34 years old and younger, 25- to 34-year-old, and they are driving this team and they are doing the presentations. They have done the work, to save the money on the jobs. These youngsters come in and says, ``Boy, you old-timers, why are you doing it the hard way?'' And they have provided us this kind of performance improvements, and that is our team. The youngsters, we have some of them in the crowd here. Melissa? Wave your hand, Melissa. She's the leader of the team, and we have a couple other people here, all these youngsters, and we are trying to drive that. We are afraid that our efforts could be forestalled if there is not a clear understanding of what we intend to do and what the impact of NSPS will be to these workers. Senator Voinovich. I have a few more questions. If you were in our position, we're the Subcommittee on Oversight of Government Management and the Federal Workforce, would you suggest that we consider quality management as something that would be promoted government-wide, as something that would really make a difference for our Federal workers? The other question I have, and, Senator Akaka, maybe you have thought about this, but it seems odd to me that the only time that Federal agencies practice quality management is when work is competed and employees establish Most Efficient Organizations. So you're saying to your workers that you can compete and try to be more efficient or else your jobs will be contracted out. The interesting thing is that Federal employees win over 85 percent of the competitions. Mr. Toyama. Yes. Senator Voinovich. I wonder why does it take the threat of competition to give the people who want to do the best they can, the flexibility to create their own Most Efficient Organization. In effect, that's what you did with quality management, right? Mr. Toyama. Yes. Senator Voinovich. You put your best team together. We need to examine that. Mr. Toyama. I think in response to your first question, I think, yes, quality management expectation from the national level is well worth the effort, and I think it will drive productivity, and you're correct, what happened in Pearl Harbor Naval Shipyard, they're going to farm the total shipyard out. We're going to be on the BRAC list. It opened everybody's minds and eyes up, to understand that we're not bulletproof because we work in Pearl Harbor Naval Shipyard. We're not bulletproof and we need to add to the national effort of improving our efforts here in Pearl Harbor, and we've done that, and I will send you the presentation and I'll tell you this, we will make this happen with or without management's help, because our vision is we can ensure the future, our mission is to ensure a future for the Pearl Harbor workers, and this is the youngsters that put this together, and our values is always good. We will always do good for the shipyard and the Navy. Senator Voinovich. Thank you. Senator Akaka. Senator Akaka. Thank you, Mr. Chairman. I want to tell our panel that I cannot adequately say how proud I am of you and the way you've shared the spirit of Hawaii here today. I thank you for sharing your wisdom gained from all the years you've served at Pearl Harbor Naval Shipyard, and your experience with us today. I look upon this as helping us try to determine what is best for our country, and I thank you so much for your assistance. So, mahalo, thank you so much for your testimonies. Mr. Toyama. Senator, one more issue. I forgot to answer one of Senator Voinovich's question, What can we do?. The coalition, the United DOD Workers Coalition have proposed this, and I think it's a workable plan, and I think it will help NSPS with the blue collar workers and throughout, is to look at the issue of national bargaining. They don't want to bargain with us, and they want to do collaboration, thus we have this whole program that no one trusts. I think they talked about bargaining, that it should go to national bargaining maybe, and have the smart guys in Washington kind of hammer it out, so we, the trenches, if you get some buy-in and some perspective of what our leaders in Washington have proposed and accepted, and what the leaders of DOD in Washington have proposed and expected, opt to work for us, I think national bargaining may help. I cannot speak for the coalition entirely. I tell you from the trenches, from the bottom looking up, we need buy-in from the top coming down. Senator Voinovich. Is the coalition---- Mr. Toyama. United Coalition, Department of Defense. United Department of Defense--Worker Coalition. My age catch up with me once in a while. Senator Voinovich. So does mine. Mr. Toyama. But, I would think that our national leaders will be well equipped to vet this out quickly, at the national level, and the transparency and the trust and the buy-in at this level would go incredibly faster. Senator Voinovich. Thank you. Senator Akaka, thank you very much for encouraging me to do this. I just want to tell you, we have differences of opinion on a couple things, but I'm really glad you're in a leadership role, and that you are in the Senate. I look forward to continuing to work with you on the Subcommittee. Mr. Toyama. I represent the West Coast of the IFPTE, and I represent NASA, Glenn, Local 28 of IFPTE. Senator Voinovich. Oh, do you? Mr. Toyama. And Virginia Cadwell always reminds me that you're a good guy. Senator Voinovich. Thank you. Senator Akaka. Well, let me add my mahalo nui loa to the Chairman for taking this time to come out here to Hawaii, and to Janet, his wife, and for holding this hearing out here. I'm really grateful. This will not only help Hawaii, but it will help our country. Thank you. Senator Voinovich. Great. Thanks. The hearing is adjourned. [Whereupon, at 4:09 p.m. P.S.T., the Subcommittee was adjourned.] A P P E N D I X ---------- [GRAPHICS NOT AVAILABLE IN TIFF FORMAT] <all>