Strategic Compensation Policy Center

A Vision for the Future . . . .

With the passage of the Government Performance and Results Act in 1993, a new era was born - an era where all Federal agencies must clearly define their missions and spell out the results they will produce for the American taxpayers.  Never before has it been so critical for agencies to have the compensation tools that will allow them to achieve their strategic goals.

To assist Federal agencies in this integral part of strategic decision making, the Office of Personnel Management established the Strategic Compensation Policy Center.  The Center is spearheading the development of a strategic compensation environment to help Federal managers and human resources professionals recruit and manage a highly productive workforce focused on critical goals and mission accomplishments.

In developing the compensation system of the future, the Policy Center is looking at best practices in pay, benefits and other forms of compensation in the Federal, state and local governments, the private sector, and in foreign governments.  In addition, the Policy Center is working with the Human Resources Management Council, made up of Human Resources Directors throughout government to collect views about changes in compensation practices that would assist managers and human resource professionals in recruiting and managing the workforce they need to accomplish their agency's mission.

The Strategic Compensation Policy Center is committed to working with stakeholders throughout the Federal community to fashion comprehensive proposals for a compensation system that ensures equity while providing managers the tools necessary to meet future challenges.  In addition to Federal agencies, the Policy Center is working with Federal employee unions, with management associations represented in the Coalition for Effective Change, and with other leadership groups committed to improving the Federal government's administrative systems.

Recently OPM established a mutually agreeable process with Federal agencies, unions, and management associations to review major components of the current compensation system.  Under the agreement, OPM will provide history, background, and research information to workgroups composed of stakeholder and OPM staff.  The workgroups will produce an initial set of observations about new compensation practices that might fit with principles of Federal employment and be useful within Federal compensation environment. 

The Policy Center is looking at the following issues in designing a compensation system for the 21st century:

• What basic principles should underlie our compensation systems?  The ones currently in place (equal pay for equal work, comparability), and/or others?

• Should there still be an all-purpose, Governmentwide white collar pay system like the General Schedule?  If not, what values and principles should be common across all pay systems?

• What should our job evaluation system be? The position-based classification system we currently have, or something else? Should there be a range of choices for agencies to choose from?

• How can pay and performance management systems better support a link between pay and organizational performance?

• How can we best capture and manage the total costs of compensation, particularly as we include benefits?

Product

Our goal is to develop a legislative package that:

• meets the expressed needs of stakeholders;

• supports agreed upon values and principles; and

• supports the varied missions of the Federal government.

Strategic Compensation    Evolution of Federal White Collar Pay   Compensation Administration