LegiStorm

Summary:

Title XI of the National Defense Authorization Act for FY2004, P.L. 108-136 , includes provisions on a National Security Personnel System (NSPS) for the Department of Defense (DOD) and provisions on personnel management that are applicable government-wide. The law was enacted on November 24, 2003. Title XI, Subtitle A, of the law authorizes the Secretary of Defense and the Director of the Office of Personnel Management (OPM) to establish a new human resources management (HRM) system for DOD's civilian employees and to jointly prescribe regulations for the system. The Secretary and the Director are authorized to establish and adjust a labor relations system and are required to provide a written description of the proposed personnel system or any adjustments to such system to the labor organizations representing DOD employees. A collaboration procedure must be followed by the Secretary, Director, and employee representatives. The Secretary is authorized to engage in any collaboration activities and collective bargaining at an organizational level above the level of exclusive recognition. The Secretary also is authorized to establish an appeals process that provides fair treatment for DOD employees covered by the NSPS. Regulations applicable to employee misconduct or performance that fails to meet expectations may not be prescribed until after the Secretary consults with the Merit Systems Protections Board (MSPB) and must afford due process protections and conform to public employment principles of merit and fitness at 5 U.S.C. Section 3201. A qualifying employee subject to some severe disciplinary actions may petition the MSPB for review of the department's decision. The board could dismiss any petition that does not raise a substantial question of fact or law and order corrective action only if the board finds that the department's personnel decision did not meet some prescribed standards. An employee adversely affected by a final decision or order of the board could obtain judicial review. Subtitle C of Title XI includes amendments to the government-wide policies for the federal employee overtime pay cap, military leave, and Senior Executive Service pay, and creates a Human Capital Performance Fund to reward the highest-performing and most valuable employees in an agency. DOD and OPM jointly published final regulations for the NSPS in the Federal Register on November 1, 2005. The regulations state that "issuances" to implement the regulations will be prepared by DOD. Draft versions of the "issuances" are currently under discussion by the department and labor organizations. A coalition of federal unions, including the American Federation of Government Employees, filed a lawsuit in federal district court challenging the final regulations. On February 27, 2006, the court enjoined the regulations because they failed to ensure collective bargaining rights, did not provide for independent third-party review of labor relations decisions, and failed to provide a fair process for appealing adverse actions. DOD said that it will appeal the decision. In early March 2006, DOD stated that the phased implementation of the new system and its classification, performance management, compensation, staffing, and workforce shaping components would begin in April 2006, with some 11,000 employees. This report will be updated to reflect changes in the status of implementation.