Federal government is introducing several pay systems to give agencies more flexibility. Pay-for-Performance is to improve performance in the federal government by offering incentives such as salary increases, bonuses, and benefits. Being similar to Merit Pay for public teachers it follows Performance-related Pay in the private sector. Still there are key differences in how pay-for-performance models influence federal employees in public service roles and what exactly makes the public sector different.
However Departments of Defense and Homeland Security are experimenting with new pay systems and a agencies like Federal Aviation Administration has implemented core compensation pay band systems nearly two decades ago. The new systems incorporate wider, pay "bands," instead of grade levels to enhance performance as opposed to length of service.
There are eight major pay systems and half of the workforce is under the General Schedule (GS) pay scale, 20 percent under Postal Service rates, and about 10 percent under the Prevailing Rate Schedule (WG) Wage Grade classification. The remaining pay systems are for the Executive Schedule, Foreign Service, Special Salary Rates and Nonappropriated Fund
Instrumentalities pay scales, and Veterans Health Administration.
General Schedule (GS) has 15 grades of pay for civilian white-collar and service workers. New employees usually start at the first step of a grade and nearly all physician and engineer positions fall into this category. Federal employees working in the continental US receive locality pay to make federal pay more responsive to local labor market conditions. Every January a pay adjustment tied to changes in private sector pay levels is divided between an across-the-board pay increase in the General Schedule and locality pay increases.
For those in craft, repair, operator and laborer jobs, the Federal Wage System (FWS) is used. This schedule sets federal wages so that they are comparable to prevailing regional wage rates for similar types of jobs. As a result, wage rates paid under the FWS can vary significantly from one locality to another.
Federal employees may receive one-time incentive awards ranging from $25 to $10,000 bestowed for a significant suggestion, a special act or service, or sustained high job performance. Some workers also may receive "premium" pay for working overtime, on holidays, on weekends, at night or under hazardous conditions.
General Schedule (GS) pay varies as the General Schedule Base Pay Table shows as per the "base rate" used to establish each of the 32 Locality Pay Tables. If you work in an area that isn't covered by a Locality Area your pay will be determined using the "Rest of the US" table.
There are a number of special compensation systems that augment the general schedule. Physicians receive signing bonuses for a one-year continued-service agreement and additional bonuses for two years. The Federal Aviation Administration pays employees in safety-related careers under a "Core Compensation" multi-pay band system. Organizations such as the General Accounting Office (GAO), NASA and the Commerce Department's National Institute of Standards and Technology either are exempt from or have exceptions to the GS pay system.
