If any of the 3 links are weakened then pay for

- If any of the 3-links are weakened, then “pay-for-performance” is called into question
3) Pay determination
-Most significant goal of any remuneration system is fairness
- An organization confronts 2 types of decisions in management of compensation to
achieve this goal: pay level and pay adjustments
- Compensation in any jurisdiction is a product of:
a) Pay philosophy, as informed by law and policy
b) Labor market forces (external competitiveness) as reflected by manipulation of
supply and demand
c) Job content (internal consistency) as assessed by job evaluation techniques
d) Individual contributions, as influenced by longevity, merit, skill, and group pay
- Decisions about level of pay are a consequence of philosophy, market, and job
evaluations
- Decisions about pay adjustment emphasize an employee’s place in the salary
structure
- Together these judgments should represent the greater good by aligning the interest of
the public and its servants.
4) The Great Pay Debate
(I would recommend reading the section as well on pg. 248)
-Salary war: Government personnel compensation has become a political issue due to
high unemployment, stagnating pay, recession, budget deficits
- 75% of citizens believe that federal employees get better pay and benefits than people
doing similar work outside of the government
- Private vs. Public Sector

- For this reason, civil servants have become a symbol of government excess, leading
to limits on hiring, pay freezes, furloughs, salary reductions, pension cutbacks and
outsourcing.
- In contrast the US Office of Personnel Mgmt. (OPM) counter that the public workforce
is not only older but also more educated, unionized, and white collar than business
employees.
- The pay for an average private sector worker cannot be fairly used as the standard for
public service pay.
c) Experience is valued
- Seniority: critical element of pay-for-performance systems
- Not very popular in government owing to the emphasis given on performance
and results
Merit Pay
- Annual increment to the base salary, an annuity that compounds for as long as the
employee remains with the department.- It is important to recognize that there may be
no final solution to pay and benefit issues for public and private sectors due to subject in
market forces and wages/benefits.
- The issue is to develop a transparent way to determine the comparisons and to assess
the potential effects of change before reform is adopted.
- The debate is a proxy fight for what role government should play in society
- Whatever may be decisive in policy change, it should meet these principles of
a) Transparency
b) Equal pay for equal work
c) No political influence
d) Ability to recruit and retain a well-qualified workforce
- and Government can act as a model employer – one that offers fair and competitive
pay/benefits
- The ultimate goal should be that every working person receives reasonable pay and
benefits
5) Pay banding
- Made popular by downsizing and de-layering that characterize many restructured
organizations.