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FPCD-81-73 1 (1981-09-11)

handle is hein.gao/gaobabcjs0001 and id is 1 raw text is: BY TtEIF COMPTROLLER GENEAL Report To The Congress OF THE UNITED STATES Serious Problems Need To Be Corrected Before Federal Merit Pay Goes Into Effect By October 1, 1981, pay increases for Government managers and supervisors in grades GS-13 through GS-15 are to be based on performance. Approximately 100 agencies will be required to implement merit pay systems to compensate as many as 152,000 employees. However, OPM's decentralized, nonprescriptive ap- proach has not provided the leadership agencies need to insure quality merit pay programs. As a result, agencies are experiencing problems that will ultimately affect the merit pay program. Many agencies are not pretesting their systems to identify and correct problems early. OPM's method for computing agencies' merit pay funds will cost the Government from $58 to $74 million more each year than if employees had remained under the General Schedule pay system. Furthermore, OPM's merit pay formula permits funds that cannot be paid to employees at the $50,112.50 statutory pay ceil- ing to be paid to employees below the ceiling. The increase in payroll costs and the use of capped money for merit pay employees do not conform with the Civil Service Reform Act. GAO recommends delaying merit pay implementation until agencies are ready to make sound pay decisions based on performance and urges OPM to revise its formula to comply with the law. 116324 FPCD-81-73 SEPTEMBER 11, 1981 1/63'?! 0. 1,60 IA& k . '', T

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