Will This Experimental Personnel System Impact Your Future Pay?

By on January 26, 2016 in Pay & Benefits with 77 Comments

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In December it was announced that 13,000 non-bargaining unit civilian employees at the Air Force Material Command would be coming under the aegis of the AcqDemo project.

This may lead you to ask, what is the AcqDemo project and what does it mean to those who are covered by its provisions? This article tries to answer those questions.

What is AcqDemo?

The Department of Defense (DOD) Civilian Acquisition Workforce Personnel Demonstration Project (AcqDemo), a project mandated by Congress, is designed to show that the DOD acquisition, technology, and logistics (AT&L) workforce can be improved by providing employees with a flexible, responsive personnel system that rewards employee contribution, and providing line managers with greater authority over personnel actions. Its goal then is to attract, motivate, and retain high quality acquisition, technology, and logistics professionals.

Where Did AcqDemo Come From?

The National Defense Authorization Act (NDA) for Fiscal Year 1996, as amended, authorized the DOD, with approval of the U.S. Office of Personnel Management (OPM), to conduct a personnel demonstration project that would cover civilian employees involved in acquisition activities. The DOD AcqDemo project was implemented on 7 February 1999. The demonstration project was seen as an opportunity to re-engineer the civilian personnel system to accomplish two goals: better meet the needs of the AT&L workforce, and enhance the ability of AT&L managers and employees to fulfill the DOD acquisition mission. It is one of about 17 demonstration projects approved by the U.S. Office of Personnel Management (OPM) over the past 30 years.[1]

What Does It Mean To An Employee Who Is Covered By AcqDemo?

The AcqDemo is a revised personnel system designed to retain, recognize and reward AT&L employees for their contribution, and to support their personal and professional growth. It also is designed to provide managers the authority, control and flexibility they need to achieve quality acquisition processes and quality products.

These goals are to be accomplished by establishing a new personnel system not bound by the Title 5 provisions under which most Federal civilian employees have been hired, compensated and rewarded for more than 60 years. This means the General Schedule (GS) pay system and related Title 5 performance management, hiring procedures, and reward mechanisms do not apply to employees who are part of AcqDemo.

The AcqDemo initiatives include: a simplified, accelerated hiring process; an expanded candidate selection process; a modified appointment authority; and a contribution-based compensation appraisal system (CCAS). It also includes a simplified classification system; broadbanding; academic degree and certification training; a simplified, modified reduction in force (RIF) process; sabbaticals; and a voluntary emeritus program.

What Does the Broad Banded System Look Like?

One of the most noticeable changes for employees moving into the AcqDemo project from the General Schedule is the broad-banded classification and pay system. Under the AcqDemo classification system the GS pay plan identifier will be replaced by three pay plan identifiers, one for each of the AcqDemo Career Paths. These are:

  1. NH that includes business management and technical management professional jobs. Examples of jobs in this group are Budget Analyst, Electrical Engineer, and Information Technology.
  2. NJ that includes technical management support jobs. Examples of jobs in this group are Computer Operator, Engineering Technician, and Library Technician.
  3. NK that includes administrative support jobs. Examples of jobs in this group are Secretary, Accounting Technician, and Procurement Assistant.

Within the NH group the 15 General Schedule grades are combined into four broader bands. These are: Level I is for entry level positions and includes former GS-1 – GS-4 jobs; Level II is for journeyman level positions and includes former GS-5 – GS-11 jobs; Level III is for professional or master level positions and includes former GS-12 – GS-13 jobs; and Level IV is for senior management or master level positions as well as experts within a particular functional specialty and includes former GS-14 – GS-15 jobs. The other two career paths, NJ and NK, combine the grades in somewhat different combinations, with the NJ path having four levels and topping out at the former GS-13 grade level, and the NK path having three levels and topping out at the former GS-10 grade level.

What Does the Pay Structure Look Like?

Pay within each band will not be limited to the relatively narrow range currently found in an individual GS grade level. Rather a band will include the same range of pay as included in the former GS grade levels. For example, the pay range for NH Level II, which includes the former GS-5 – GS-11 grades, begins at the equivalent of step one of the GS-5 and ends at the equivalent of step 10 of the GS-11.[2]

Besides having a broader range within which pay can be set, there are no established steps that denote a pre-determined salary. Thus, the ten steps that make up the narrow GS pay range are replaced by a broader band that is open for use. This means there is the potential to set an employee’s pay at any dollar amount with a broader band based on his or her contribution to mission accomplishment. In addition to the basic pay, the applicable locality rate will be added to the AcqDemo employee’s basic rate of pay.

How Will Pay Increases Be Calculated?

The AcqDemo system is designed to reward employees for their contributions to accomplishing the mission. To do this a new contribution based appraisal and pay increase system has been designed. It is called the Contribution-Based Compensation and Appraisal System (CCAS). CCAS, as a contribution-based appraisal system, goes beyond a performance-based rating system. Thus, it measures the employee’s contribution to the mission of the organization, and base pay adjustment decisions are linked to, and based on employee contribution.

As noted, the premise of CCAS is that employees will be compensated based on their contributions. This means that employees who contribute at a level above the level expected based on their compensation will, in most cases, be eligible to receive compensation awards. Those who contribute at a level equivalent to what is expected based on their compensation will receive at least the annual general increase. Employees who do not contribute at a level matching their compensation may receive little or no compensation awards. When an employee is considered inadequate, i.e., is significantly below what is expected for the employee’s compensation, a Contribution Improvement Plan (CIP) will be developed that will highlight areas of inadequate contribution, and describe standards for adequate contribution. The CCAS appraisal period will coincide with the fiscal year, 1 October of one year through 30 September of the following year.

The AcqDemo project is designed to help managers carry out their responsibilities in a number of ways. One of them is that the factors used to describe work in the Position Requirements Document (PRD) and place a position in the appropriate broadband also are used to set expectations in the contribution plan, and are used again to rate the level of contribution at the end of the cycle. The PRD replaces the position description (PD) utilized by those covered by the General Schedule (GS) system. The same six factors apply to all career paths (NH, NJ, and NK):

  • Problem Solving – personal and organizational problem solving results
  • Teamwork/Cooperation – individual and organizational teamwork and cooperation for both formal and informal teams
  • Customer Relations – effectiveness of personal and organizational interactions with customers, both internal and external
  • Leadership/Supervision – individual and organizational leadership and/or supervisory contributions
  • Communications – effectiveness of oral/written communications
  • Resource Management – personal and organizational use of resources to accomplish the mission. Resources include, but are not limited to, personal time, equipment and facilities, human resources, and funds

Each factor is described using brief written statements called ‘descriptors’ at four levels. Each level is written to characterize the ‘discriminators’ that are associated with a particular factor. As an example, Level II for the Leadership/Supervision factor in the NH career path might look like the following.

Level II Descriptors Discriminators
Actively contributes as a team member/leader; provides insight and recommends changes or solutions to problems. Leadership Role
Proactively guides, coordinates, and consults with others to accomplish projects. Breadth of Influence
Identifies and pursues individual/team development opportunities. Mentoring/Employee Development

Each level in a particular factor is written using the same contribution discriminators.

Employees will be asked to provide a self assessment and all supervisors will create an assessment for each of the employees for which she or he is responsible. Supervisory assessments are to be completed by end of October/1st week of November for submission to the Pay Pool Panel (PPP). Although not described in detail, a PPP will be convened for each pay pool established within an organizational unit. After reviewing the employees’ self assessments and the assessments written by the supervisors a group consensus will be reached on each employee’s contribution.

As a result of the contribution assessments an employee may be eligible either for a Contribution Rating Increase (CRI) in basic pay or a Contribution Award (CA) when an employee is at the top of the pay range. A CRI may range up to a 6 percent increase in basic pay in most cases. The amount of a CA is not discussed, but a fund equivalent to at least 2 percent of the basic pay of the employees in the pay pool will be made available to increase employee compensation. Those who contribute at a level equivalent to what is expected based on their compensation will receive at least the annual general increase.

Where Can I Learn More About AcqDemo?

The AcqDemo project includes guidance for qualifying and hiring employees, and for setting employee pay upon appointment, at movement from a GS position to an AcqDemo position, and upon promotion from one band to another. It also includes provisions to encourage continued employee development; a simplified, modified reduction in force (RIF) process; sabbaticals; and a voluntary emeritus program. In footnote one, above, the AcqDemo website is listed. It contains lots of information about each of these program areas as well as training materials that can help you to understand the project. Browsing through this well organized and colorful website should help to answer any questions not covered in this article or that may occur to you after reading it.

[1] U.S. General Accounting Office Report GAO-04-83, Implementing Pay for Performance at Selected Demonstration Projects, January 2004; page 3. Authority for personnel research and demonstration projects was established in Title VI of the Civil Service Reform Act of 1978 (5 U.S.C. Chapter 47).

[2] Currently, each GS grade level is about 30 percent in width. This means that the step 10 rate is about 1.3 times the step 1 rate. By comparison, the pay range of each band width varies. For example, the NH Level II is about 140 percent in width. The highest rate of pay in the NH II level is about 2.4 times the lowest rate in the NH II pay range.

Wayne Coleman is a federal pay expert available to help your agency avoid premium pay claims through on-site training. Contact him for more information.

© 2016 Wayne Coleman. All rights reserved. This article may not be reproduced without express written consent from Wayne Coleman.


About the Author

Wayne Coleman’s career at various Federal agencies spanned about 32 years.  Since his retirement he has consulted on, written about, and provided training on overtime and premium pay, on the principles of FLSA coverage and exemption, and on related federal compensation issues.  He can be reached at wayneslyhouse@comcast.net.