Rewarding Performance

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Rewarding Performance Improving Productivity

• Louisiana Department of State Civil Service
• May 14, 2008
• Partnering for a Better Louisiana
• www.civilservice.louisiana.gov

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Agenda

• Performance Management considerations
• Pay for Performance overview
• Pay for Performance tools
• Current practices in government
• Roundtable discussions
• Wrap up

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Performance Management

• Traditionally have considered individual
  performance
• Increasing emphasis on organizational performance
• Shift in thought and action for employees and
  rating supervisors

4
Performance Management

• Performance Management is not just an annual
  appraisal
• Begins with organizational objectives and
  measures
• Organizational objectives are translated into
  individual or team objectives.
• These objectives are communicated to the relevant
  employees so that they can understand how their
  performance is integral to the organizations
  success.

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Performance Management

• The key to an outstanding performance management
  system is Communication
• Goals (Planning)
• Mission and goals
• Weighted factors
• Employee development
• Monitoring and Feedback
• Development
• Ratings

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Performance Management

• Communication tools
• Formal methods
• PPR Forms
• Standard form
• Alternative form
• Agency specific forms
• Position Descriptions
• Supervisory memos, performance plans, discipline
• Informal methods
• Should be reduced to writing

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Performance Management

• When to rate?
• Focused rating date
• Anniversary date
• Considerations
• employees/supervisor
• Data availability
• Factors for granting merit increase
• Agency policy

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Performance Management

• Agency Experience with Focused Rating Date
• Ann Wills, DOTD
• Phone [phone]
• E-mail AnnWills_at_dotd.la.gov
• Advantages
• Issues/Concerns
• Experience

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Performance Management

• Other types of performance incentives
• Flexible work schedules
• Alternative work arrangements
• Project development
• Training

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Pay For Performance Overview

• The Pay for Performance Trend
• PFP in the Public Sector
• PFP for Classified Employees
• Roundtable Discussions
• Variable Merits
• Focused Merits
• Contacts/Reference Material

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The PFP Trend

• Philosophy of employee compensation
• Measures individual behaviors AND individual and
  organizational results
• Sets performance standards consistent with
  strategic plans
• Rewards employees for meeting or exceeding these
  standards

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Public Sector Goals

• Improved efficiency
• Improved constituent services
• Change in organizational culture
• Old focus Length of service, entitlement
• New focus Employee value, performance

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Will PFP be effective?

• Why is a reengineered compensation program
  needed?
• How do proposed PFP elements compare with the
  previous system and why was that system
  deficient?
• What will the revised program accomplish for
  employees and the organization?
• What rewards will be meaningful?
• Will the program be funded adequately and
  consistently on a year-to-year basis? How?
• How will the programs accomplishments and
  effectiveness be measured?

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Internal Questions

• Are we ready?
• What do we have in place? Is it working?
• What types of PFP will be most effective?

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Issues to Consider

• Administrative Burden
• Human Dynamics
• Budget
• External Factors

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Types of Pay for Performance

• Individual Spot Award
• What is it?
• Advantages/Disadvantages
• Best Use

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Spot Award Example
U.S. Department of Agriculture Individual Spot
Award

• Criteria
• Award Procedures
• Rewards

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Types of Pay for Performance

• Individual Incentive Plans
• Examples
• Advantages/Disadvantages
• Best Use
• Team/Group Incentive Plans
• Examples
• Advantages/Disadvantages
• Best Use

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PFP Examples

• Alabama
• Special Merit (Exceptional Pay Increase)
• Utah
• Each agency responsible for PFP plan
• Colorado
• Achievement pay, varies by FY occup. group
• Florida
• Prudential-Davis Productivity Awards
• Center for Disease Control

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Tools for a Successful PFP Plan

• Measurable Organizational Objectives
• Public Scrutiny
• Tailor your PFP Plan according to your agencys
  needs
• Evaluate regularly and modify as needed
• Communication, Training, Transparency
• Funding

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Successful PFP Programs

• Performance Improves
• The programs engage participants (employees)
• Can attract quality employees

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Rewarding Classified Employees

• Merit System Principles PFP
• Tools for rewarding employees
• Agency policies and examples

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Career Progression Groups

• Tool for Recruitment and Retention
• Clear career path
• Memo/criteria on how employees will be moved
  through the CPG
• Based on experience, duty assignments,
  competencies, and performance

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Merit Increases Rule 6.14

• Purpose
• Reward employee for work performance
• Incentive for continuous employment
• Employee Eligibility
• Six months continuous employment
• Anniversary Date
• Based on employee performance
• 4 or 1.04 X current salary

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Rewards and Recognition (RR)Program Rule 6.16.1

• An appointing authority may implement a program
  of rewards and recognition for individual
  employees or for employee groups for significant
  achievement.
• Purpose

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RR Policy Requirements

• Approved written and posted policy
• Posting of all reward recipients
• Reported annually to the Dept. of Civil Service
• Monetary awards
• Up to 10 of employees base pay
• Lump sum payment

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RR Policy Outline

• Applicability
• Eligible employees
• Based on performance
• Provisions
• Depends on funding
• Type/amount of awards under policy
• Nomination and Selection procedures
• Posting and reporting

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RR Agency Examples

• Individual achievement awards
• Team awards
• Lump sum payments established as percent up to
  10.
• Special projects
• Innovation
• Lump sum payments established as dollar amount
• Job related training/certifications

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Innovation and Creativity

• Housing Authority
• Pay for High Performer Ratings
• 4 to 10 lump sum payment
• Other Tools - 6.3.1/6.16(d)
• DOTD
• Incentive Pilot Program

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Exceptional Performance and Gainsharing Rule
6.16.3

• Incentive program to encourage increased
  efficiency and better performance
• Employee eligibility
• Lump sum reward not to exceed 20 of employees
  annual base salary
• Approval from Civil Service Commission prior to
  distribution of awards

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Exceptional Performance

• Current law RS 3987.5
• Incentive Fund housed in Treasury Dept.
• 3.2-4 million
• Application procedures and policies
• Rewards
• 5,000.00 lump sum payment
• Individual employees and/or agency
• Elise Read, Legislative staffer, contact
  225-342-1394 or reade_at_legis.state.la.us

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Gainsharing

• Current law RS 39.87.6
• If an agency achieves monetary savings, some of
  the funds saved may be returned to the agency.
• Currently HB 1087 by Rep. Henderson seeks to
  amend the statute
• Previous administrations chose not to implement a
  procedure.

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Roundtable Discussions

• Group 1 Variable Merits
• Group 2 Focused Rating/Merits

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Wrap Up

• Performance Management
• Inspiring Excellence with Pay
• Want to do more? Contact us.
• Phone [phone] or E-mail us.
• Anne Soileau, Director anne.soileau_at_la.gov
• Ashley Gautreaux, DSCS Program Assistance
  ashley.gautreaux_at_la.gov
• Marianne Covington, DSCS Compensation
  marianne.covington_at_la.gov
• Sandy Glass sandy.glass_at_la.gov
• Becky Cresap becky.cresap_at_la.gov
• Bethany Matthews bethany.matthews_at_la.gov