Merit Pay? For Federal Employees?

The Office of Personnel Management announced yesterday that 25 agencies were making trial runs of performance-based pay based on the Bush Administration's preference for performance-based pay. The trial appears to primarily target managers and high-grade non-management personnel and base pay and basic cost-of-living-based raises will not be affected at this point. A form of performance-based pay is presently being used in the Department of Homeland Security.

It will be very interesting to see how the performance-based pay trials turn out. Even a limited use of merit pay would be a major change in the federal bureaucracy.