What are Pay Bands? - FederalPay.org

Overveiw

Pay Bands are a type of pay scale designed to provide more flexibility regarding how much employees are paid. The goal of Pay Banding is to give supervisors the ability to reward performance more. In the GS scale, pay is based education and experience. Not until you reach the higher GS grades are the grades given competitively. In addition to basing salary on education, experience and position, Pay Bands base salary on job performance. Job performance is decided by an employee’s supervisor.
Pay Banding is often implemented by compressing the GS’s 15 grades into four or five Pay Bands. These pay bands typically range from GS-1 to GS-5, GS-6 to GS-11, GS-12 to GS-13 and GS-14 to GS-15. Each pay band has a minimum and maximum pay. Within these bands, pay is based on employee performance. An employee at the top of one band will usually make for than someone at the bottom of the next higher pay band.

Advantages

National Security Personnel System (NSPS) was a Pay Band system, created in 2006, designed to replace the GS Scale throughout the entire Department of Defense. The NSPS changed policies such as tenure, collective bargaining and automatic grade increases under the GS system. The added flexibility under the NSPS system came at a significant bureaucratic price. Under NSPS, supervisors were forced to painstakingly monitor employee performance to the point of hampering productivity more than it helped.

Disadvantages

NSPS purportedly weakened Equal Employment Opportunity and Veterans’ Preference protections. Preliminary studies by the U.S. Department of Labor found – while controlling for education, experience and tenure – minorities tended to fair worse under the NSPS system. In 2009, before the NSPS Pay Band system was fully implemented, it was repealed by congress. Employees were then transitioned back to the GS scale or, in some cases, to other Pay Banding Systems in order to continue experimenting with the system. The benefits and impacts of a Pay Band system are still open for debate.

The Debate

The Pay Band verses GS Scale debate generally falls along partisan political lines. Conservatives typically favor a Pay Band system while Democrats favor a more uniform pay system such as the GS Scale. Unions generally oppose Pay Banding. It should be noted that the NSPS Pay Band system was established under President George W. Bush and repealed under President Barack Obama.

Pay Band systems on a small scale have been successful. There are several forms of pay bands systems still in use today. Often new programs or organizations with high visibility and high public accountability will rely on pay bands in order to provide added motivation to employees. The Transportation Security Administration (TSA) and the Federal Aviation Administration (FAA) both implemented successful Pay Banding Systems.

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