National Security
          Personnel System

In the wake of the September 11th terrorist attacks, Congress granted the Department of Defense authority to revamp personnel rules governing federal workers.  Congress specifically called for workers’ rights and union rights to be protected, but the Department of Defense went beyond what was approved and ignored both the intent and letter of the law.

Instead of protecting workers, the proposed National Security Personnel System (NSPS) would strip civil service protections against cronyism in government. It would also remove most collective bargaining rights and protections for fair pay standards, job assignment procedures, veterans preferences, and protection from unfair discipline.

On November 7, 2005, 10 federal employee unions jointly filed suit in the United Stated District Court for the District of Columbia. On February 27, 2006, Judge Emmett G. Sullivan released his decision.  Considered an absolute win for the unions, Sullivan ruled illegal several key labor-management components of the new personnel system. 

Despite Judge Sullivan’s ruling establishing the unlawfulness of the NSPS regulations, DoD is pushing forward with implementation.  On April 30, 2006, a group of 11,000 employees were moved over to a watered-down version of NSPS covering performance management, compensation, classification, staffing, and workforce shaping provisions of the human resources component.  According to Mary Lacey, the Pentagon’s program executive overseeing NSPS, the agency has plans to move an additional 75,000 to 100,000 Defense workers under the new system in the fall of 2006.

According to a February 14, 2005 report in the Federal Register, NSPS will cost $158 million through 2008 to design and implement.  As high as this figure is, Defense worker unions have argued that this number is unrealistically low. 

Given the legal issues surrounding the NSPS regulations and the high cost of implementing the personnel system (when Defense budgets are already spread extremely thin), it does not make sense to continue funding the NSPS program at this point in time.  Why fund the implementation of a personnel system that has largely been deemed illegal by the courts when there are so many other needs going unmet? 

The Office of Management and Budget (OMB) has announced its own overhaul of domestic federal agency personnel rules.  Like NSPS, this plan contains a subjective pay-for-performance system.  OMB claims that the recent court decision will have no impact on its ability to proceed with its plan. 

Entitled the "Working for America Act", this program would strip employees of their rights in the event of emergency, with "emergency" being defined broadly enough to include changes in workload.   OMB denies that it is taking NSPS and applying it to the entire federal workforce.

In May, 2007, a bitterly divided 2-1 opinion, the U.S. Court of Appeals for the District of Columbia Circuit, reversed the U.S. District Court, which enjoined DoD from implementing regulations on labor relations, adverse actions, and employee appeals.  The Court determined that the National Defense Authorization Act of 2004 (NDAA) gave the Secretary of Defense, in conjunction with the Director of the Office of Personnel Management, the authority to “curtail collective bargaining” until the law sunsets in November 2009.

The Court noted that while the NDAA ensures collective bargaining as a system requirement, statutory phrases such as “as provided in this chapter” and “subject to the provisions of this chapter” allowed the Secretary essentially to ignore the mandate. The majority thus found that DoD has this “temporary, experimental period” to set up a labor relations system essentially unfettered by collective bargaining requirements.

The majority also found that the law explicitly allows the Secretary to issue implementing issuances that abrogate collective bargaining agreements at any time. The Court also rejected our arguments that the National Security Labor Relations Board was not an independent third-party as required under the law, however, it never addressed whether the internal labor board constituted a third party. Finally, the Court dismissed arguments that conduct expectations imposed on employee representatives, such as union officials, would chill vigorous advocacy.


Union representatives, including IAM/NFFE Federal District 1 President Richard Brown (2nd from left), explain their walkout from talks with the Defense Department over the National Security Personnel System

Several days later, the Senate Armed Services Committee released the contents of the Defense Authorization Bill for fiscal year 2008.  Included in the bill was a provision to do the following:

“To repeal the existing authority of the Department of Defense to establish a new labor relations system under the National Security Personnel System (NSPS). This would guarantee the rights of DOD employees to union representation in NSPS. This provision would permit the Department to continue its effort to develop a new pay-for-performance system, if the system is implemented in a manner that is consistent with existing federal labor relations law.”

In response to this release, National Federation of Federal Employees (NFFE) National President Richard N. Brown issued the following statement: “We are very pleased to see the Senate Armed Services committee take a stand against DoD’s effort to eliminate collective bargaining."

UPDATE: The efforts of NFFE and other labor organizations to protect workers' rights have proven to be fruitful.  

On January 29, 2008, NFFE issued this press release: 

Yesterday, President George W. Bush signed the National Defense Authorization Act for Fiscal Year 2008 (H.R. 4986) into law.  Included in the bill was language to fundamentally alter the National Security Personnel System (NSPS), a controversial personnel reform at the Department of Defense (DoD).


“We are glad to see this process finally come to an end,” said NFFE President Richard N. Brown, referring to the drawn out path the bill took to reach passage.  “It has been almost two months since we learned what was in the conference report.  We fought very hard for changes to NSPS, and we are happy these reforms are finally signed into law.”


Section 1106 of the bill includes language modifying NSPS.  The language will restore collective bargaining rights and employee appeal rights for Defense workers under NSPS.  It also exempts blue collar workers from NSPS entirely.  The language left in place DoD’s authority to create a pay for performance system.  However, the measure would guarantee that NSPS employees get 60 percent of the annual pay raise given to most federal workers if they perform at a satisfactory level or above.  Only the remaining 40 percent of the pay adjustment, which is set annually by Congress, would go toward performance pay.  Defense workers will also continue to receive locality pay when performance is satisfactory.


“We believe these NSPS reforms greatly improve DoD’s personnel system,” said Brown.  “It was unrealistic for the agency to think that the rank and file Defense workers would embrace a new system when their workplace rights, such as the rights to bargain and have a fair system of appeals, are taken away under that system.  With these changes, NSPS has a much better chance of being a success.  This reform is without a doubt a victory for Defense workers.”


While the new rules for NSPS are an improvement over the previous plan, unions are careful not to be too enthusiastic about the personnel system.


“We believe these changes greatly improve the personnel system over its previous form, but NSPS is still far from perfect in our opinion,” said Brown.  “But at least some common sense has been restored.”


NFFE applauds Congress for getting this important bill passed.


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