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I am pleased to present the Office of Personnel Management's (OPM's) report to Congress on the pay of Bureau of Prisons Federal Wage System (FWS) employees. This report was prepared in response to House Report 107-152, which accompanied H.R. 2590 (enacted as Public Law 107-67, November 12, 2001).In that report, the House Committee on Appropriations directed OPM to review and report to Congress on how the current wage survey instrument quantifies the cost of labor with respect to "mixed wage grade jobs" at the Bureau of Prisons (BOP), U.S. Department of Justice.The Committee expressed concern that FWS wage surveys may be inadequate with respect to setting pay for BOP employees.
Our report concludes that the FWS accomplishes its goal of setting pay rates for blue-collar Federal workers in line with local private sector labor market rates and that the FWS Job Grading Standard for Supervisors fairly and consistently addresses the correctional responsibilities of blue-collar Federal workers at BOP facilities.We believe the wage surveys conducted by the Department of Defense for FWS pay-setting purposes allow the Government to establish equitable prevailing rates of pay for BOP jobs, even though some jobs may have no exact counterpart in local private industry.
The Presidents emphasis on the strategic management of human capital in the Federal Government places a renewed focus on the need for more creative use of current human resources management flexibilities.A number of pay flexibilities are available for use by all Federal agencies to deal with any recruitment or retention problems they may experience with respect to the Governments blue-collar workforce, and our report highlights those flexibilities.
Because the Federal Prevailing Rate Advisory Committee has a longstanding interest in the pay-setting methodology for BOP wage employees, I believe it is important for that Committee to study the findings in this report before OPM considers any possible changes in the current wage survey process.We are providing a copy of this report to the Committee, and I look forward to receiving any recommendations that body may wish to make on this matter.
I want to thank the dedicated staff of OPM's Workforce Compensation and Performance Service for their hard work in drafting this report.The report can be found on the OPM Web site at Federal Wage System.
Kay Coles JamesDirectorFebruary 2002
House Report 107-152 accompanying H.R. 2590 (enacted as Public Law 107-67, November 12, 2001) directed the Office of Personnel Management (OPM) to review and report to Congress on how Federal Wage System (FWS) wage surveys quantify the cost of labor with respect to blue-collar jobs at the Bureau of Prisons (BOP), U.S. Department of Justice. The Committee expressed concern that FWS wage surveys may be inadequate with respect to setting pay for BOP employees. This report presents OPMs findings concerning the pay of FWS employees at BOP.
OPMs pay and classification policies are tailored to address the unique working conditions of BOPs blue-collar workforce. For many years, blue-collar Federal workers at BOP have been compensated through the job evaluation process for the additional difficulty and responsibility attributable to the supervision of inmates. Virtually all blue-collar positions throughout BOP are classified as Wage Supervisors (WS), even though the positions are not supervisory in the traditional sense.
BOPs wage positions are classified using the Job Grading Standard for FWS Supervisors. This standard recognizes that one of the most complex situations in terms of its application is the supervision of inmates performing craft, trade, and laboring work at correctional facilities. Under the FWS Job Grading Standard for Supervisors, an upward grade adjustment may be made in determining the grade of a supervisor responsible for work operations involving the exceptional conditions existing at correctional facilities. The effect of using the supervisory standard at the next higher grade level provides BOP wage employees with rates of pay that are more than 30 percent higher than for the corresponding nonsupervisory grade level. We believe the FWS Job Grading Standard for Supervisors fairly addresses the correctional responsibilities of blue-collar Federal workers at BOP.
This report contains background information about the history of pay for BOP wage employees, information on the current nature of work of BOP employees and the process the Department of Defense uses to measure local prevailing rates in local wage areas, an analysis of the wage rates at BOP facilities, and our conclusions concerning the pay of BOP wage employees.
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Blue-collar Federal workers have been paid according to local prevailing private sector rates since the Civil War. Until 1965, each Federal agency had authority to determine local prevailing rates and establish wage area boundaries for its employees. As a consequence, blue-collar Federal workers at the same grade level in the same city working for different agencies received different rates. In 1965, President Lyndon B. Johnson addressed this inequity by ordering Federal agencies to coordinate their wage-setting activities under the leadership of the Civil Service Commission. The Commission established the National Wage Policy Committee, made up of the heads of the major employing agencies and the heads of the major Federal employee unions, to seek advice on how to combine separate agency pay systems into a Coordinated Federal Wage System (CFWS).
In 1972, President Richard M. Nixon signed Public Law 92-392, which established the current Federal Wage System. The FWS incorporated most of the existing administrative policies of the CFWS. Since 1972, the Commission and its successor agency, OPM, have been responsible for overseeing the administration of the FWS. The FWS now covers about 230,000 craft, trade, and laboring employees. These employees are located in 132 separate wage areas throughout the country and in overseas areas. BOP has 4,287 FWS employees in 61 of these 132 wage areas.
BOP was established in 1930 to provide progressive and humane care for Federal inmates, to professionalize the prison service, and to ensure consistent and centralized administration of the 11 Federal prisons in operation at that time. Today, BOP consists of about 100 institutions, 6 regional offices, a central office (headquarters), 3 staff training centers, and 28 community corrections offices. BOP is responsible for the custody and care of approximately 154,000 Federal offenders. Approximately 130,000 of these inmates are confined in BOP-operated correctional institutions or detention centers. The remainder are confined through agreements with State and local governments and through contracts with privately operated community corrections centers, detention centers, prisons, and juvenile facilities.
It is the policy of the Federal Government to keep inmates active and productive while confined. Work is BOPs most important correctional program. Prison work programs teach inmates occupational skills and instill sound and lasting work habits and work ethics in offenders. All sentenced inmates in Federal correctional institutions are required to work (with the exception of those who for security, educational, or medical reasons are unable to do so). Most inmates are assigned to an institutional job such as food service worker, orderly, plumber, painter, warehouse worker, or groundskeeper. Approximately 25 percent of BOPs eligible sentenced inmates work in Federal Prison Industries factories. They gain job skills through specific instruction in factory operations for a variety of products and services. Inmates are compensated for their work with a subsistence wage and can receive raises based on their performance.
Correctional institution employees, including blue-collar Federal workers, must ensure the security of Federal prisons, provide inmates with needed programs and services, and model mainstream values. These employees help BOP meet its obligation to protect public safety and provide security and safety to the staff and inmates in its facilities. Even though blue-collar Federal workers are hired for one primary skill, they are also trained as security officers and perform security functions as a collateral duty. The work activities of inmates must be supervised very closely.
For many years, blue-collar Federal workers at BOP have been compensated through the job evaluation process for the additional difficulty and responsibility attributable to the supervision of inmates. Before 1958, most trade, craft, and laboring positions in BOP were considered General Schedule (GS) positions and were classified according to the standard for the Prison Administration Series, GS-007. The grade pattern in that standard was based in part on the premise that a prison constituted a hazardous work environment. However, the primary basis for grades higher than those afforded by Governmentwide standards was the supervision of prisoners. For example, a prison carpenter position involving carpentry duties, which under the Governmentwide standard warranted classification to grade GS-5, would be placed in grade GS-6 by the standard for the Prison Administration Series in recognition of supervisory responsibilities.
The Prison Administration Series standard was replaced in 1958 by one that defined the factors of security, guidance, and training of inmates and provided for classifying most GS positions involving responsibility for the work activities of inmates to grades higher than those appropriate for the non-inmate related duties of the positions. At the same time, the Department of Justice (DOJ), with the approval of the Civil Service Commission, determined that trade, craft, and laboring positions in BOP were exempt from coverage under the GS and should be classified and paid under a wage board system. Blue-collar positions were then classified according to the wage board supervisory standards published by the Department of the Army. In addition to the grade arrived at under the wage board supervisory standard, a supplemental guide developed by DOJ also was applied. This guide generally augmented the grade already established under the wage board supervisory standard by one grade.
After the CFWS was established in 1965, supervisory wage employees at BOP were graded according to the CFWS supervisory standard and a DOJ supplemental guide. In 1972, with the establishment of the current FWS, these positions were graded under the FWS supervisory standard and the DOJ supplemental guide. The DOJ guide continued to provide employees with one additional grade above that attained under the CFWS or FWS supervisory standard.
In 1982, OPM issued the FWS Job Grading Standard for Supervisors, and this new guide was then used for classifying FWS positions in BOP. OPM revised this guide in 1992. Both the 1982 and the 1992 Job Grading Standard for FWS Supervisors continued the practice of allowing BOP to add a grade to wage positions in recognition of their correctional responsibilities and consistent with criteria set forth in the standard.
The practical effect of placing BOPs wage employees under the current FWS compensation structure is to set their rates of pay at least 30 percent higher than for the corresponding nonsupervisory grade level. For example, WS-10 rates are 30 percent higher than WG-10 rates. The differential is more than 30 percent at lower grade levels. In addition, the BOP practice of placing its wage employees one grade level higher than would be allowed in other agencies gives BOP employees an additional 3 to 5 percent boost in pay, depending upon geographic location. At Attachment 1, we have included a copy of Subchapter S5 of the OPM Operating Manual Federal Wage System, Prevailing Rate Determination. This subchapter provides instructions for conducting wage surveys and establishing wage schedules. Section S5-11f(3) of this subchapter contains information on how wage supervisory pay schedules are computed.
BOP classifies all of its employees in blue-collar positions as Wage Supervisors. These WS employees supervise prison inmates working in manufacturing, mechanical maintenance, utilities operations and maintenance, food service functions, and related operations or other WS employees. Although inmates normally work only on the day shift, WS employees frequently work rotating shifts to perform their work assignments.
In addition to their primary responsibilities as supervisors of blue-collar work performed by inmates, WS employees receive law enforcement training and are considered law enforcement officers for retirement and pay purposes. In this respect, BOPs WS employees are in jobs that have mixed duties and responsibilities. However, this is not a unique requirement for BOPs wage employees, since all BOP employees, from file clerks to dentists, must have law enforcement training to cope with any correctional situations that may arise in their work environment.
Some examples of mixed occupations for BOP wage employees are described below. All of these positions are designated as law enforcement officers.
The primary duties of a cook supervisor include the supervision and instruction of inmate workers in all phases of the preparation, presentation, and timeliness of all food items that are placed on the serving line. Duties also include the supervision of inmates in the serving of all meals and the sanitation of the Food Service Department. The supervisor must familiarize the inmates assigned to the Food Service Department with the overall operation of the department and train them in the various aspects of its operation.
The maintenance mechanic supervisor is a major contributor to the planning and operation of the prisons maintenance system, work programming, major work orders, and engineering design and drafting. The supervisor supervises staff and inmate personnel who perform construction and/or maintenance repairs of buildings, landscape, utilities, and facility vehicles. The maintenance mechanic supervisor is responsible for the security of the institution and performs correctional worker duties.
The electrical worker supervisor trains and supervises inmate workers involved in electrical installation, construction, and maintenance work. The supervisor may be called upon to perform some electrical work due to security concerns or lack of skilled inmate workers. The supervisor must possess skill and knowledge in the operation and installation of complete wiring systems found in industrial complexes. The supervisor must have the ability to interpret and apply the National Electrical Code, local codes, building plans, blueprints, wiring diagrams, engineering drawings, and trade formulas. The work performed by the supervisor must be at or above the journey level to train unskilled inmate workers effectively.
The electrical equipment repairer supervisor is responsible for the technical and administrative supervision of an all-inmate workforce accomplishing trades and labor work in the manufacture of a finished product according to the requirements of a production schedule. The supervisor assigns, directs, and reviews the work of the inmates on the work crew. The supervisor must be able to plan, schedule, and coordinate work operations under the supervision of the Factory Manager and solve work-related problems in addition to determining the materials and equipment necessary to produce the final product. The supervisor supervises the inmates involved in the manufacture of various types of harnesses and cable assemblies ranging from simple single conductor cable to highly complex multi-conductor harnesses, missile cable assemblies, and sub-assemblies.
The air conditioning equipment mechanic supervisor is a member of the Facilities Department and serves as a supervisor who trains, motivates, and directs an inmate work crew in the maintenance, repair, modification, installation, and troubleshooting of refrigeration, heating, ventilation, and air conditioning equipment. Specific duties include installing, dismantling, recognizing the cause of faulty equipment, and making necessary repairs on refrigeration and heating and air conditioning units and systems. The supervisor performs routine preventive maintenance on switches, chillers, ice machines, freezers, exhaust fans, and climate controls. The supervisor is responsible for maintaining security and control of the work area by maintaining key and inmate accountability. Other security measures may include shakedowns of inmates, visual searches, participation in fog or escape patrols, and the use of self-defense techniques or firearms.
BOP assigns grades to the positions of WS employees under OPMs FWS Job Grading Standard for Supervisors. WS employees receive full credit for planning, assigning, instructing, motivating, and counseling employees; reviewing completed work and work in progress; maintaining discipline and enforcing rules and regulations; and administering management programs such as safety and cost reduction. OPMs standard also recognizes that one of the most complex situations in terms of its application is the supervision of inmates performing craft, trade, and laboring work at correctional facilities.
At correctional facilities, special staffing requirements may impose a substantially greater responsibility on the supervisor for training, counseling, and maintaining security than that which is normally encountered in orienting, training, and supervising civil service employees in accomplishing work. Work at correctional institutions also involves situations with exceptionally difficult attitudinal, control, and security problems. Under the FWS Job Grading Standard for Supervisors, an agency may make an upward grade adjustment in determining the grade of a supervisor responsible for work operations involving such exceptional conditions that affect the majority of the subordinate workforce when all of the following are present:
Each FWS wage area consists of a survey area and an area of application.
One of the key statutory principles underlying the FWS is that pay rates are to be maintained in line with prevailing levels of pay for comparable levels of work in the private sector within a local wage area. To carry out this statutory principle, the Department of Defense (DOD) conducts annual wage surveys of private sector employers in each local wage area to determine local prevailing rates. By law, representatives of employee labor organizations are involved in all aspects of the prevailing rate pay-setting process. Please see Attachment 1 for a full description of the procedures DOD uses to determine prevailing rates and establish wage schedules for FWS employees.
In each local wage survey, a labor-management local wage survey committee collects wage rate data for a prescribed list of survey jobs which cover a wide range of occupations common in skill and responsibility in both industry and Government. Please see section
S5-6b(4) of the OPM Operating Manual in Attachment 1 for a list of the 21 standard survey jobs used in every FWS wage survey. DOD may add an additional survey job(s) in a wage area if DOD finds that the additional survey job(s) represents significant numbers of employees in private sector establishments or Federal installations.
FWS surveys determine prevailing rates through procedures developed over years of labor-management cooperation. First, a selected sample of FWS jobs is surveyed in each wage area. Then the survey results are analyzed statistically to produce a 15-grade payline that forms the basis for the new FWS wage schedule. In combination, the FWS job-grading system and survey process efficiently maintain internal equity among Federal jobs and external equity with prevailing private sector rates.
The FWS pay structure consists of a 15-level job-grading system that includes the full range of non-supervisory trade, craft, and laboring jobs in more than 250 occupational series. Occupations often cover more than one grade level, and many occupations typically are represented at each grade. This pay structure makes it possible to establish equitable prevailing rates of pay for Federal jobs that are classified at the same level of work, even though some Federal jobs may have no exact counterpart in local private industry. For example, many BOP positions have no exact counterpart in private industry. While State and local government prisons may have positions similar to those of BOP positions in some parts of the country, current law provides only for surveys of positions in private sector establishments.
In response to the request of the House Committee on Appropriations, Attachment 2 lists the FWS local wage areas where BOP facilities are located, identifies the BOP facilities located in each of those wage areas, and shows the average weighted hourly wage rate for each facility. We note that different facilities have employees in different mixes of occupations and grade levels. Therefore, the differences among average wage rates shown in this attachment are not wholly indicative of differences in the prevailing rates of pay among the wage areas involved.
Because the FWS is a prevailing rate system, its wage schedules are very market sensitive. It is the policy of the Federal Government to pay its blue-collar workers a fair wage that is comparable to what an employee could expect on average to earn for work at a similar level of skill in local private sector companies. The differences in rates of pay among wage areas reflects the fact that the prevailing cost of labor varies by wage area. It is not unusual for FWS employees who work in different wage areas to receive sometimes substantially different rates of pay even though they may have similar grade levels and job duties.
The average quit rate over the last 5 years (September 1996 to September 2001) for BOP wage positions was 1.86 percent. For the FWS as a whole, the average quit rate for wage positions during the same period was only slightly lower1.74 percent. In FY 2001, the overall quit rate for BOP wage positions was only 1.60 percent, which was slightly lower than the overall quit rate for all FWS positions1.65 percent. The Department of Justice does not believe it has widespread recruitment or retention problems for its BOP wage employees. Where the facts have warranted the use of current pay flexibilities, BOP has used them. If BOP experiences localized recruitment or retention problems in the future, several flexibilities exist under the FWS to address such problems.
Agencies have considerable discretionary authority to provide additional direct compensation in certain circumstances to support their recruitment, relocation, and retention efforts. The following summarizes some of these compensation flexibilities as they apply to the FWS:
OPMs pay and classification policies are tailored to address the unique working conditions of BOPs blue-collar workforce. For many years, blue-collar Federal workers at BOP have been compensated through the job evaluation process for the additional difficulty and responsibility attributable to the supervision of inmates. Virtually all blue-collar positions throughout BOP are classified as Wage Supervisors. These positions are classified using the FWS Job Grading Standard for Supervisors. This standard specifically addresses supervisory jobs with correctional responsibilities. Under the FWS Job Grading Standard for Supervisors, an upward grade adjustment may be made in determining the grade of a supervisor responsible for work operations involving the exceptional conditions existing at correctional facilities. We believe the FWS Job Grading Standard for Supervisors fairly and consistently addresses the correctional responsibilities of blue-collar Federal workers.
As a whole, we believe the FWS accomplishes its goal of setting pay rates for Federal blue-collar workers in line with local private sector labor market rates. The policy of paying blue-collar Federal workers according to local prevailing rates is an equitable policy that ensures these workers receive fair wages, that Federal agencies can recruit and retain an effective workforce, and that the Government does not lead local labor markets by paying rates to its employees that are higher than local private sector employers can afford. By design, the FWS establishes rates of pay that are different in different labor markets. It is normal for wage rates in a wage area to be substantially different from wage rates in adjacent wage areas.
We have found little evidence of widespread recruitment and retention problems at BOP facilities. When labor market conditions affect the Governments ability to attract and retain qualified employees, several pay flexibilities are available to alleviate such problems, such as recruitment and relocation bonuses, retention allowances, and increased minimum rates or special rates. If we receive a request from BOP to use pay flexibilities that require our prior approval, we will work to address any recruitment and retention problems that are brought to our attention.
We conclude that the current method used to quantify the cost of labor is adequate to set pay for mixed jobs at BOP, even though some jobs at Federal prisons may have no exact counterpart in local private industry.
OPM Operating Manual - Federal Wage System, Subchapter S5, "Prevailing Rate Determination"
Source: OPM Central Personnel Data File, September 2001