9.0HumanCapital3a.pptxManaging Human Capital in the Public and Nonprofit Sectors
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People as Human Capital
Personnel administration, or personnel management, is the planning and policymaking for, and managing of, employees, and is
limited to “internal” processes, such as compensation.
During the 1980s, a more modern view emerged: human resource management, which expands the field by
including “external” processes, such as professional development.
Currently, human capital management views employees as valuable assets that can be further enriched through greater investment, and
aligns human capital policies with the organization’s mission.
Personnel-lists, or professionals and specialists in the field, often use these terms interchangeably, as do we., the most commonly used initials “HR” designates all three titles.
Nevertheless, they do have differences:
each successive title represents a broader concept that places an increasing emphasis on the worth of employees.
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Who Wants To Work And Who Doesn’t?
Over five consecutive years, the percentage of undergraduates who planned to work for the federal, state, or local government “immediately after graduation” declined by nearly half:
Local governments, however, exert a particular pull;
82 percent of women and 74 percent of men who once worked in local government would “consider returning” to a local government leadership position.4
Barely half of students in masters of public administration (MPA) and similar programs express interest in being employed by government, and, at the twenty top programs, not even half are.
More generally, white people, Republicans, and those who never served in the military are overrepresented among those Americans who spurn working for government.
An astonishing 56 percent of corporate and nonprofit managers are not or “not at all” interested in working for the federal government, and only
17 percent express any interest in doing so.
None of this is good news for governments, but the real story lies with growing student interest in working in the independent sector
The decision to start careers in the independent sector, rather than the public one, works out well for those who make it.
“Compared to those working in the public sector, managers in nonprofits report greater freedom in deciding how to carry out their job functions,
more control over their work schedules, and greater opportunities for pay increases.”
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The Evolution Of Public Human Capital Management
The evolution of public HR management in the United States can be roughly divided into six phases.
Government by Gentlemen, 1789–1827
Government by Spoilers, 1828–1880
Government by the Good, 1881–1905
Government by Scientific Managers, 1906–1936
Government by Policymaking Administrators, 1937–1954
Government by Professionals, 1955–Present
Depending upon the phase in question, America’s governments have been dominated, in successive turns,
by its aristocrats, corrupt officials, ardent reformers, “scientific” managers, dynamic administrators, and timid clerks.
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Government by Gentlemen, 1789–1827
In 1789, the federal government started off with three departments (State, Treasury, and War), and, by 1836, it had five departments and 336 employees.
During most of this period of very limited government indeed, the first half-dozen presidents favored “government by gentlemen,”
or those who were reputed to be persons of character and competence, qualities that were defined largely by a respected family background and a high degree of formal education.
Being a member of the establishment counted for a lot:
over the course of the country’s first forty years, almost two-thirds of the eighty to a hundred or so top appointees were drawn from the landed gentry, merchant, and professional classes.
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Government by Spoilers, 1828–1880
Even as they were being governed by gentlemen, however, Americans were growing less gentlemanly in their politics.
When independence was declared, in 1776, over four-fifths of the states required that, to vote, men must own land or have paid taxes, but,
by 1830, only half of the states retained these stipulations.
As a result, far more men could vote, and many could not be described as gentlemen. When combined with a populist candidate—in the form of Andrew Jackson in the election of 1828—
voting turnout more than tripled from the previous election (16 percent turnout), and surpassed half of all eligible voters for the first time.
These fundamental political changes meant only one thing: spoils.
If presidents were to emerge, like Jackson, from the class that earned its own living, then politics had to be made to pay.
Contrary to conventional wisdom, however, Jackson maintained past establishmentarian patterns, dismissing about the same share of political appointees as had his gentlemanly predecessors.
John Tyler (1841–1845) was the first president to implement a comprehensive spoils system, a practice that reached its apex with the presidency of Abraham Lincoln (1861–1865),
but spoils continued to mar government for the next several decades.
It is difficult for those of us reared in an environment of largely honest government to appreciate the extent—and the brazenness—of the spoils period.
After an election, newspaper advertising typically swelled with such announcements as, “WANTED — A GOVERNMENT CLERKSHIP at a salary of not less that $1000 per annum. Will give $100 to anyone securing me such a position.”
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Government by the Good, 1881–1905
The corrupt excesses of the spoils system eventually resulted in a reform movement that was determined to rid government of those bureaucrats who owed their office to nothing more than party hackwork.
Between 1861 and 1882, sixty-four civil service reform bills were introduced in Congress, but not one of them was passed by even one chamber.
The assassination of President Garfield by a deranged office seeker, in 1881, changed Congress’s collective mind.
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The Civil Service Act of 1883
Just two years following Garfield’s assassination, Congress passed the Civil Service Act (also known as the Pendleton Act, after its legislative sponsor), which created a bipartisan Civil Service Commission charged with creating a nonpartisan federal service.
The act’s commitment to neutrality and fairness was strengthened by subsequent presidential directives that prohibited an employee’s removal for political or religious reasons (in 1896), and guaranteed due process for those who had been hired competitively (1897).
Although the Civil Service Act was influenced by the British public service, the Senate inserted some major provisos that were uniquely American.
One such clause was that civil service examinations must be “practical in character.”
In stark contrast to Western Europe, the law laid no tracks between the civil service and the universities, and it was only in 1905 that the Civil Service Commission first observed that “the greatest defect in the Federal Service is the lack of opportunity for ambitious, well-educated young men”;
a serious effort to correct that deficiency surfaced, eventually, in the 1930s.
Similarly, the act set up no body of permanent, high-level, professional public administrators, as is the norm in Western Europe.
The unintended consequence is that Washington now oozes presidentially-appointed political executives, who consistently underperform relative to careerists.
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“Goodness” versus “Badness”
“Government by the good” led, in 1907, to President Theodore Roosevelt’s Civil Service Rule I, which prohibited almost seven out of ten federal workers from participating in political campaigns and barred the solicitation of political contributions from federal employees.
These reforms were strengthened and broadened by the Political Activities Act, also known as the Hatch Act, of 1939.
In 1940, the Hatch Act was amended to extend its coverage to state and local workers whose salaries are paid entirely or in part with federal funds,
and to prohibit these employees from running for public office.
More recently, Washington has lightly loosened political restrictions on government workers.
The Hatch Act Reform Amendments of 1993 lifted the 1907 prohibition on federal employees participating in political campaign, but they still may not be candidates in partisan elections or engage in political activity while on duty.
In 2012, Congress passed the 2012 Hatch Act Modernization Act, which continues the ban on entering elections for those state and local employees who are paid entirely with federal grants or loans,
but lifted the prohibition from those who are paid only in part with federal funds.
In 2016, the Supreme Court ruled that it is unconstitutional to discharge or demote a (in this case, local) government employee because he or she supports a particular political candidate.
Over time, civil service commissions, which typically administered these and similar policies, became associated “with morality, with a connotation of ‘goodness’ vs. ‘badness,’ quite apart from the purposes for which people were employed.”27
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Government by Scientific Managers, 1906–1936
Despite government by the good, good government remained elusive.
In 1912, an analyst decried the “snail like pace” of government employees, alleging that they wasted from 40 to 70 percent of their work time.
The influential New York Bureau of Municipal Research, a privately-supported think tank founded in 1906, agreed with this assessment, and its first forays focused on getting public “workers to do the work they were hired to do,” a concentration that quickly incorporated a “strong link between the bureau and scientific management.”
It was, a likable link, and it left legacies. A major one is the position classification system, first adopted by Chicago in 1912, and which has been described as
“the ascendancy of scientific management.”
The council-manager form of local government emerged as a direct outgrowth of the period’s precepts; the first government to adopt a council-manager plan was Sumter, South Carolina, in 1912, and, by 1930, 418 local governments had adopted it.
Certainly government by scientific managers served to extend the reach and power of the Civil Service System. Between 1900 and 1930:
the proportion of federal civilian employees administered by the Civil Service Commission shot from 46 percent to 80 percent;
the number of states that had merit systems expanded from two to nine;33 and cities with civil service commissions nearly quadrupled from sixty-five to 250.
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Government by Policymaking Administrators, 1937–1954
In 1937, the report of the president’s Committee on Administrative Management (more commonly known as the Brownlow Committee, after its chair, Louis Brownlow) was published,
and, for the first time since its founding, the usefulness and power of the Civil Service Commission were quietly questioned.
“Personnel was seen as a principal, if not the major, tool of management,” and the committee recommended that each major agency have its own personnel manager reporting to its top administrator.
The president quickly complied, in 1938, with Executive Order 7916. The Hoover Commission’s first report, issued in 1949, also took up this cudgel, and “little Hoover commissions” in many states did the same. Today, agency-based HR offices are commonplace.
There was more. “Administration” also expressed the long-denied reality that public administrators make public policy.
When, in 1953, Dwight D. Eisenhower, a Republican, assumed the presidency after two decades of Democratic government, he discovered, maddeningly,
a huge civilian bureaucracy that had more than quadrupled in size since the last Republican administration, and which was run by entrenched Democratic policymakers, who, perversely, were protected by
civil service regulations that were based on the premise that politics should not intrude on administration!
Although academia during this period was barely beginning to recognize that bureaucrats made public policy, elected policymakers clearly understood that they did.
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Government by Professionals, 1955–Present
By mid-century, another value was entering the milieu of public HR: professionalism.
The professional period encompasses two distinct systems of public HR.
One is Specialized Public Professional Systems, or those public personnel systems that are geared to the career needs of high-ly-educated specialists.
The other is the Professional Public Administration System, which reflects the idea that FIR systems should encourage effective and efficient management by competent generalist administrators.
These professional systems are two of the five systems of public human capital management, each with its own values and mission,
the remaining three are the Civil Service, Collective, and Political Executive systems.
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The Civil Service System: The Meaning Of Merit
The civil service has been the historic heart of public administration. The general Civil Service System, or merit system (a phrase that emphasizes the values of public service, in contrast to its bureaucratic structure),
is career personnel who have tenure and who are administered according to traditional merit practices.
The civil service is independent of government and is also composed mainly of career bureaucrats hired on professional merit rather than appointed or elected, whose institutional tenure typically survives transitions of political leadership.
It is the opposite of the spoils system
A civil servant or public servant is a person employed in the public sector on behalf of a government department or agency.
A civil servant or public servant's first priority is to represent the interests of citizens.
Workers in "non-departmental public bodies" (sometimes called "Quangos") may also be classed as civil servants for the purpose of statistics and possibly for their terms and conditions.
Collectively a state's civil servants form its civil service or public service.
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Public Human Capital Management
What do governments’ human capital managers do? Their major duties, listed in the order of the most time that they devote to them, are:
recruiting and hiring;
benefits administration;
pay administration;
developing FIR policy, such as retirement plans;
position classification;
training and development;
processing grievances;
appraising and measuring employee performance;
brokering conflict; managing diversity;
and collective bargaining, among other activities.
FIR professionals also may influence the morale of their public agencies.
It seems that if FIR workers are happy in their work, then their agencies’ co-workers are happier than the overall norm.
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Grass-Roots: Recruiting Bureaucrats
Asked “which workforce issues are important to your organization?” more than nine out of ten state and local officials replied that
“recruiting and retaining qualified personnel with needed skills to public service.
State and local governments are abandoning printed media in recruiting and are going full-blast electronic.
Eighty-four percent of these governments cite “online job advertising” as their “most successful” recruitment practice in “reaching qualified candidates,”
followed by “government web sites”
and “social media;
“state/ local newsletters,”.
Those states with more usable Web sites [receive] significantly more applications per job opening.
The states are introducing major reforms designed to decentralize and simplify recruiting.
A plurality of states, twenty-two, have decentralized recruitment to the agencies, and another eighteen share this responsibility with the central personnel bureau.
Nevertheless, nearly four out of ten state agency heads think that the complexity of personnel procedures
is their most serious impediment for recruiting.
Local governments have focused on proactive recruitment.
Most solicit applications from minority and women’s organizations, state and private employment agencies, unions, professional organizations, and use internships as a recruiting tool.
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Does Washington Hire Well?
In spite of itself, Washington may be hiring fairly well.
Twenty-nine percent of federal executives and top professionals who were hired from outside the government think that the quality of federal supervisors is better than in their last place of employment and 21 percent think that the quality of their co-workers is higher.
Most of the data support these opinions. Almost half of all entering federal employees have college degrees in specifically relevant fields.
There is “little difference in the education levels and grade point averages” among applicants who accept offers of federal employment and those who take other options, an indication that Washington competes successfully in hiring.
State Hiring share at least one hiring issue with Washington: “The size of the applicant pool for career professional positions is not likely to be large [and] the quality of the applicant pool is not likely to be very strong.”
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A Caveat about Federal and State Hiring
Despite corporate managers’ contempt for working in the federal government, a solid majority of upper-level new federal hires and a dominating plurality of entry-level ones who were hired from outside the government nevertheless are drawn from the private sector.
Overwhelmingly, these sector switchers cite “job security” as their leading motivation for making the switch.
State mid- and upper-level administrators who were hired from corporations typically supervised few corporate subordinates,
and their switch often entailed a public-sector promotion.
Do these patterns imply that the public sector has a special attraction for managers whose corporate careers are stuttering, or even stuck,
and only then does government become their belated second choice?
It is an all-the-more intriguing question when we realize that only 3 percent of upper-level new federal hires and 4 percent of entry-level ones who are hired from outside the government are drawn from the independent sector—
the sector that far surpasses the other two in terms of its employees’ disdain for job security and their strong need for socially meaningful work.
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Classifying Bureaucrats
Position classification is a core tenet of the Civil Service System. Indeed, employees in the civil service are also known as “classified” employees.
Classifying Federal Employees Until 1923, when the Classification Act was enacted, federal supervisors had unlimited autonomy to determine the pay of workers,
and federal employees were growing increasingly angry about their lack of rigor and, often, fairness.
The act authorized the Civil Service Commission to group federal positions into rational classes
and pay their occupants accordingly.
A more comprehensive Classification Act was enacted in 1949.
It established the dominant classification system, the General Schedule (GS), composed of fifteen grades for civilian workers, and, within these grades, there are roughly 420 to 450 occupations, as OPM continuously revises the number.
At the very top are the 8,000 or so members of the Senior Executive, Senior Professional, and Senior Foreign services, each with its own classification system.
Blue-collar and Postal Service employees, and about twenty agencies, also have their own systems.
Classifying at the Grass Roots All state governments have position classification systems.
Eight states have decentralized classification from their central personnel office to the agencies, and another eight distribute this duty between their HR and line agencies.
A dozen states require their cities to adopt classification plans, although almost all local governments of any size have them.
Most cities and counties use a single classification system, although, oddly, the smaller the jurisdiction, the more likely that there will be multiple systems.
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Training
Training workers to improve their workplace skills is closely and clearly linked with organizational productivity.
“The most effective private firms” spend from 3 to 5 percent of their budgets on training.
Training heightens nonprofit, federal, and state and local employees’ job satisfaction, engagement, and organizational commitment, and lowers their inclination to consider quitting their jobs—
not a surprising correlation in light of the fact that, as government training expenditures rise, so do promotion rates, and significantly so.
Evidence also suggests that a greater investment in training reduces public employees’ discrimination charges.
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Training Feds
Most federal training emerged when the Government Employees Training Act was enacted in 1958, and
today there are Management Development Centers and a Federal Executive Institute dedicated to training federal administrators.
Washington spends a modest 1.3 percent of its “personnel budget” on training, and, still worse, federal administrators are prone to focus on training programs when they need to cut budgets,
and to cut them back more than other programs.
This need for more training seems to be present at every level of the federal service, from top, to middle, to bottom.
Nearly two-thirds of the Senior Executive Service has not received “formal executive coaching,” a rising proportion, even though those with fewer than ten years of experience ranked training and development third as “the key driver of satisfaction and commitment, not pay.”
The Secret Service’s uniformed officers received a
average of just twenty-five minutes of training over the course of a year;
A promising innovation is the growing use of training via computers. Seventy percent of “federal leaders” (GS 13 and higher) think that “digital technology has improved access to training relevant to agency mission.”
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Training at the Grass Roots
Nearly three-quarters of state and local officials report that they receive “regular training,” a proportion that is far higher than that of the feds.
State administrators spend an average of twenty-five hours a year in “formal classroom training.”
It appears that most training for these administrators is conducted by universities.
State governments devote, on average, “more than 1.3 percent” of their annual payrolls to training, a conservative calculation,
with some states spending “upwards of 5 percent.”
“Unfortunately, many states report that
the training budget is the first thing eliminated in spending freezes or budget cuts.”
More than nine-tenths of the states impose training requirements on municipal and county employees, focusing on police and fire fighters;
only a small minority of states requires training for “other” local employees.
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Bolstering Bureaucrats’ Bravery
Whistleblowers, who are found in all sectors, are a courageous (some would say crazy) class of employees who “blow the whistle” on their organizations
for engaging in shoddy or corrupt practices.
Persons who expose governments’ security secrets—all national governments have such secrets, and they have them for the same reason that middle-aged people wear clothes
—do not qualify as whistleblowers.
Encouraging Whistle Blowing
The federal, state, and local governments have enacted laws that encourage whistle blowing.
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Whistleblower: A Risk Worth Taking- Maybe
A whistleblower is a person who exposes any kind of information or activity that is deemed illegal, unethical, or not correct within
an organization that is either private or public.
The typical whistleblower in the public and private sectors is a well-educated family man in his late forties who has been in his organization about seven years
and has a strong belief in “universal moral codes.”
Those who become whistleblowers can choose to bring information or allegations to surface either internally or externally.
Internally, a whistleblower can bring his/her accusations to the attention of other people within the accused organization such as an immediate supervisor.
Externally, a whistleblower can bring allegations to light by contacting a third party outside of an accused organization such as the media, government, law enforcement, or those who are concerned.
Whistleblowers, however, take the risk of facing stiff reprisal and retaliation from those who are accused or alleged of wrongdoing.
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Federal Encouragement
The most significant legislation that Congress has passed is the 1986 amendments to the False Claims Act of 1863.
They permit the federal government to award whistleblowers from 15 to 30 percent of any money recovered from fraudulent practices, with the exception of tax fraud, that they report in any federally funded contract or program.
These amendments have been quite effective.
Prior to their passage, only three out of ten federal workers who observed an illegal or wasteful activity reported it, but, following their enactment, fully half did so.
A decade after their passage, more than 1,100 companies were exposed by whistleblowers for defrauding the government, compared with just twenty during the previous decade.166
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Securing Bureaucrats’ Jobs
The popular image of the Civil Service System is one of a job for life; 58 percent of Americans think that government offers better job security than business, compared with 13 percent who say
the same for business versus government, or a factor of better than four.
Do, in fact, government employees actually have more secure jobs than private-sector employees?
You bet they do.
Americans commonly assume that the long tenures that job security brings equate with mediocre performance. This is far from the case, at least in government, for two reasons.
First, multiple studies have found that greater job security correlates clearly and positively with higher productivity in governments,
Second, even when there is relatively little job security in the public sector, there is no “strong evidence” that managers take advantage of it by dismissing low-performing employees at a significantly accelerated rate.
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Civil Service Slippage at the Grass Roots
For more than thirty years, Congress encouraged state and local governments to adopt merit systems.
The 1939 amendments to the Social Security Act of 1935 mandated that states establish systems for their unemployment-security and public- assistance employees, or lose their Social Security funds.
All states quickly complied.
The Intergovernmental Personnel Act of 1970 offered grants to subnational governments to expand and refine their civil services, but, as Congress grew disenchanted with merit systems,
funding vanished within a decade.
As in Washington, the Civil Service System’s grass-roots’ reach peaked in the 1980s, when about three-fourths of the states had comprehensive merit systems, and 60 percent of all state employees worked in them.
Eighty-eight percent of cities with populations of more than 50,000 had merit systems, and an estimated 95 percent of all municipal employees worked in them.
These numbers would soon wither. By the 1990s, literally hundreds of grass-roots’ personnel reforms were in the offing.
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Civil Service Reform in the States
At the end of the first millennium, “the general picture that emerges [in state governments] is one of administrators trapped by rigid, slow, and cumbersome systems that are incapable of meeting government’s human resources needs.”
This was especially unfortunate since personnel is the single largest consumer of revenue in the states; “almost everything a state does is labor intensive.” But change was afoot.
In 1996, Georgia initiated civil service reforms that were the most sweeping of any government at the time; other states followed
Sixteen states have contracted out at least some of their personnel services to the private sector
There has been a discernible decline in state-employee job security in thirty-one states, twenty-eight of which have adopted, in whole or part, at-will employment —that is, employees serve at the sufferance of their supervisors sans protection by the merit system.
Arizona, Colorado, Florida, Georgia, Tennessee, and Texas have, for all intents and purposes, eliminated their civil services.
States most likely to implement these reforms tend to have
relatively weak public unions, Republican-controlled governments, high administrative and legislative professionalism, low unemployment, and plentiful resources.
Has the stature of state merit systems been diminished by these reforms? Yes.
In 1983, the heads of personnel agencies in thirty-nine states reported directly to the governor, but two decades later, this held true in only twenty states.
Georgia’s personnel reforms, cited as the “most dramatic reforms” of any state, were hailed by prestigious professionals as “likely the best in the country.
There are, however, some benefits for civil services in reformed states.
The more that governments decentralize human resource activities, the more that “positive relationships” develop between “senior line managers” and human capital executives, and these relationships increase HR’s influence and performance.
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Civil Service Reform in Communities
As with the states, personnel is localities’ largest single devourer of dollars, so it follows that civil service reform is at the heart of local governmental reform; perhaps 70 percent of all local reforms relate to personnel policies.
Five percent (precisely the percentage it was thirty years earlier256) of cities and counties contract out their “personnel services” to a for-profit corporation, more than 1 percent are delivered by another government, and half a percent contract with a nonprofit organization. Nearly 9 percent of local governments deliver personnel services via “public employees in part,” meaning that corporate or non-profit employees are involved, as well as the government’s own employees.257
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The Impact of Civil Service Reform
As with the states, personnel is localities’ largest single devourer of dollars,
so it follows that civil service reform is at the heart of local governmental reform;
Civil service reform has been remarkably successful.
The states, where reforms have been relatively radical, provide the best examples of this.
Hiring, promoting, reassigning, and firing have been streamlined, and, although at-will employees are dismissed more expeditiously than are employees who are protected by civil service regulations, at-will employment does not associate with greater numbers of employees being fired.
State employees who serve at will are “significantly less negative about the full range” of civil service reforms than are their co-workers who are in the civil service,
but state personnel managers display, at best, only a rueful acceptance and some distrust of at-will reform.
An understandable concern among traditionalists was that reform would re-introduce unfettered patronage to state government,
but this has not happened.
We must note that a sad consequence of public personnel reform is that HR directors, and the enterprise of public human capital in general, often are sidelined, ignored, or dissed.
This seems especially true at the federal level, where morale in most agencies has been in decline for years, a decline that may be linked to the corresponding decline of HR management.
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The Collective System: Birth Of Organized Labor
Public human capital system is the Collective System, and it refers primarily to
blue-collar workers and white-collar professionals whose jobs are administered via agreements between management and organized workers.
The core of the Collective System is worker solidarity; in a word, unions.
Efforts to organize public employees first surfaced in the 1830s, and with reason:
wages and working conditions typically were abysmal.
With the passage, in 1935, of the National Labor Relations Act (the Wagner Act), which guaranteed private-sector workers the rights to unionize, bargain collectively, and strike, unions surged forward.
At its apex, in 1953, organized labor included almost a third of all nonagricultural employees in the nation.267
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Bargaining with Governments
Collective bargaining, or collective negotiations, is a method in which representatives of employees and employers jointly
make policies about employees’ working terms and conditions.
Historically, collective bargaining has largely been the preserve of the private sector, but, in 2009, this relationship reversed for the first time,
and the public sector had over 9 percent more workers covered by negotiated agreements than did the private one.
By 2013, the traditional pattern had reestablished itself, and businesses had nearly 10 percent more workers who bargained collectively than did governments.
Of those public employees who are covered by a negotiated agreement,
59 percent work for a local government,
27 percent for the states,
8 percent are federal civilian employees,
6 percent are Postal Service workers.
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Striking Government
There is scant agreement on whether public employees have a right to strike, with some arguing that striking is an act of insurrection, and others contending that it is a fundamental freedom.
The courts have held that there is no constitutional right of public workers to strike, but neither has the judiciary prohibited the enactment of laws permitting them to strike.
Striking Washington The Taft-Hartley Act of 1947 was the first legislation to prohibit strikes by federal employees. In 1970, more than 210,000 postal workers violated the law by staging an unprecedented walkout;
the Labor Department met almost all their demands, and the strike was over in just two weeks.
A nonplussed Congress soon divested itself of its postal problem by passing the Postal Reorganization Act of 1970, which transformed the Post Office Department, a federal agency, into the Postal Service, a federal corporation.
More broadly, Congress reasserted its anti-strike policy with the Civil Service Reform Act of 1978, which forbids strikes and slowdowns by federal employees.
In 1981, however, 95 percent of the 13,000 members of the Professional Association of Air Traffic Controllers (PATCO), possibly justifiably, probably arrogantly, and certainly foolishly, struck.
President Ronald Reagan promptly decertified PATCO—that is, the federal government no longer recognized PATCO as the official representative of its members—
and dismissed more than 11,000 air traffic controllers, breaking their union in the process. Reagan’s decertification was historic, and arguably strengthened the hand of all governments in dealing with unions.
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Why Do Incompetent Federal Employees Hang On?
Nonperformers are deeply entrenched in their jobs, and average an astonishing fourteen years in the federal employ. How could this be? There are several reasons.
A Little-Used Probationary Period
An Awful Appeals Process
Taking Unsatisfactory Action
Regrettably, supervisors often take “disciplinary” action that effectively rewards incompetents and sanctions productive employees.
A Supine System
Federal supervisors receive little support from above
Congress Intervenes (Temporarily)
State administrators seem to be doing a better job of dealing with incompetents than
their federal counterparts.
Although a third of state agency heads think that personnel rules make it difficult to discipline or discharge poor performers,
they nevertheless terminate classified workers in a speedy twenty-nine days, on average, for “performance issues,” and an even briefer eighteen for “behavioral issues.”
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Some Helpful Hints on Dealing with Incompetents
Not all is lost in the battle against incompetents. Research has found that, regardless of sector, some underused techniques can be effective. These include:
■ Confront with clarity, empathy, and privacy. When supervisors deal with a poor performer quickly, directly, issue more warnings and formal sanctions more frequently, fire (when possible) promptly when warnings fail, and do so while treating the underperformer with dignity, their units’ productivity is higher than those of supervisors who do not.510 Of course, any conferences with poor performers should be done in private.
■ Put all the rotten apples in the same barrel. Not only does isolating them reduce their ability to infect good apples, but a bunch of egocentric, energetic, destructive, overbearing people often can come up with excellent, creative ideas.511
■ Make accountability human. When radiologists saw photographs of patients whose X-rays they were examining, their diagnostic accuracy quintupled relative to when they did not see their patients’ photographs.512
■ Let the sunshine in. Employees are less honest and more selfish when they work in dark recesses or wear sunglasses in their office.513 Light up the workplace and beware the employee who sports shades in it.
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The Attributes of Effective Classification
One is the identification those attributes that an effective public job classification system should have. These include the following:
■ Equity: All employees with comparable qualifications and responsibilities should be assigned to the same grade level and be paid within ranges that are comparable to similar qualifications and responsibilities in the private sector.
■ Transparency: The classification system should be predictable and comprehensible to management, employees, and taxpayers.
■ Flexibility: The classification system should allow for adjustments in pay (among other potential adjustments) within a uniform, government-wide system so that agency needs and missions may be fulfilled.
■ Adaptability: Fundamental reviews of the entire classification system should be undertaken periodically so that the system’s adaptability to changing workplace and workforce characteristics is assured.
■ Simplicity: The classification system should enable employee mobility among agencies, maintain a rational number of occupations and meaningful differences in skills and performance within those occupations, and be cost-effective and easily managed.
■ Appropriateness: Positions should be classified based on mission needs, and employees should be classified according to their unique abilities so that those positions may be filled appropriately.
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Lessons Learned
There are some organizational factors that encourage, indirectly but clearly, more effective performance management. These include:
employees who are engaged in their jobs; organizational and managerial flexibility; high levels of trust and professionalism in the organization; and useful performance appraisals.
More proactively, public and nonprofit administrators also can act in ways that will result in better performance management. These include the following.
■Evaluate the effectiveness of the agency’s current performance appraisal system.
■Establish a separate budget for the performance pay system.
■Involve employees, including union officials, in building a high performance organization and in revising the pay system.
■Assure that there is a “clear separation of interests,” such as separate career paths, “between politicians and senior civil servants.”
■Communicate goals clearly.
■Link individual objectives with organizational goals.
■Make sure that rewards are high and clearly differentiated.
■Link performance pay with additional incentives, such as promotion.
■Select supervisors who are flexible and who will effectively manage performance.
■Hold every supervisor accountable for effective performance management.
■Arrange so that the system can be reviewed both internally and externally.
■Provide supervisors with the training, resources, and managerial support they need to improve their employees’ performance.
■Say “thank you” when it is warranted.
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The Rise of the White House Loyalty Test
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