Air Force print news (July 13, 2006): second phase of NSPS begins in October.

WASHINGTON -- The Defense Department announced plans July 12 to transfer more than 66,000 additional DoD civilian employees into the new National Security Personnel System beginning in October.

The plan, delivered to Congress earlier this week, ushers in the second phase in implementing the new pay-for-performance personnel system and affects organizations throughout DoD.

The first 11,000 DoD civilian employees were converted to the new system under "Spiral 1.1" of the phase-in on April 30. Defense officials are taking cues from this group to help smooth the way for the "Spiral 1.2" transition.

Mary Lacey, NSPS program executive officer, recently met with senior leaders from the Spiral 1.1 transition to identify what worked well and what improvements are needed.

"We are already assessing implementation for the first group of employees," she said.

The transition for the first group ran smoothly. Officials reported a 99.9 percent accuracy rate in completing affected employees' personnel actions and no glitches in processing their pay through the Defense Finance and Accounting Service.

"We are pleased with what we are seeing thus far, at least with the technical aspects of the conversion," Lacey said.

The Spiral 1.2 roll-in will take place over a four-month period through January 2007, and will include civilian employees from organizations throughout DoD, including some overseas.

Affected components will have the discretion to convert their workforce anytime between October 2006 and January 2007 to ensure enough time to train their employees, Lacey said.

"Training is critical to the successful transition to NSPS," she said. "We want to give organizations sufficient time to train employees, do it right, and implement when they are ready."

Ultimately, the system will apply to more than 650,000 DoD civilian employees.

Employees being converted to the new system will receive new performance plans that are clearly linked to their organization's mission and strategic goals. They will also be converted to pay bands that replace the grade ratings under the general schedule.

Officials emphasized that no employee will lose pay during the conversion to NSPS. Most will receive an initial pay bump to account for time already earned toward their next within-grade increase. A conversion tool in the NSPS 101 course, posted on the NSPS Web site, helps employees estimate the value of their within-grade increase, as well as their career group and pay band under the new system.

The performance appraisal cycle for Spiral 1.2 employees will begin on the actual day of their conversion to NSPS and continue through Sept. 30, 2007. These employees will receive their first performance pay increase in January 2008.

The ongoing NSPS conversion includes only the human resources parts of the system, which include job classification, compensation, performance management, staffing, and workforce-shaping elements.

It does not include elements of the new system involving labor relations, collective bargaining, independent third-party review, adverse actions, and the National Security Labor Relations Board.

DoD and the Office of Personnel Management have appealed a late February court decision blocking implementation of these provisions. U.S. District Judge Emmet Sullivan ruled that they would fail to protect civilian employees' ability to bargain collectively. The decision was based on a lawsuit filed by the American Federation of Government Employees and 12 other labor unions.

Defense officials hope for a decision on the appeal by the year's end as they continue implementing parts of the new personnel system not caught up in litigation.

NSPS is one of Defense Secretary Donald H. Rumsfeld's key initiatives designed to transform DoD operations to better meet 21st-century needs. It is replacing what officials call an outdated, 50-year-old civilian personnel management system that rewards employees for length of service rather than performance. The new program, in development since 2003, replaces the current general schedule personnel system with broad pay bands.

"NSPS is critical to the department's transformation to a results-oriented, mission-focused culture," said Michael Dominguez, principal deputy assistant secretary of defense for personnel and readiness. "The performance-based system will create an environment where our employees will be focused on outcomes that support our national security mission, and they will be rewarded for the results."