Mr. BARUCH. Yes, sir. Senator FLANDERS. One is crosswise within the job. Mr. BARUCH. On the merits of the employee's performance. Senator FLANDERS. And going from 1 to 2 and 2 to 3, and so forth, it is getting a new kind of a job? Mr. BARUCH. A job of greater difficulty of work or more responsibility. That is what the vertical movement consists of. Senator FLANDERS. I can imagine that there are greater difficulties in advancing from grade 6 to grade 7-that is less automatic than it is advancing from 4 to 5? Mr. BARUCH. Yes, sir; and that varies according to the grades. It is very difficult to characterize the frequency of promotional opportunity by grades. You get a lot of blind-alley jobs in almost any grade that you want to mention, particularly in the lower levels. where we have large blocks of employees all dressed up and really no place to go. There is a provision in the bill, section 703, which aims at that condition and will relieve it somewhat. Now, it will be observed, and I think this is something the committee is interested in, that the floor of the GS schedule is $2,100, which is a very slight increase above the floor in the subprofessional service, which is $2,020 and still a slighter increase above the floor in the CAF service which is $2,086. We are accustomed, Senator Flanders, as you know, to think of schedules first of all in terms of floor and ceiling, so the floor of the new proposed GS schedule is $2,100 and the ceiling is $16,000 compared with the present ceiling of $10,330. Let me repeat that the floor of the new GS schedule is $2,100 as compared to present floors of $2,020 and $2,086. The ceiling is $16,000 compared to the present ceiling of $10,330. Senator LONG. Let me ask you this: I see that in chart No. 1, you do not have anybody in the 16 and 17 grades, do you? Mr. BARUCH. That is correct. The new grades 16, 17, 18, and 19 are brand-new grades, Mr. Chairman, which do not exist in present law. There are no Senator LONG. I suppose that you propose to put someone in those grades, do you not? Mr. BARUCH. Yes, sir. Senator LONG. In your right-hand column the number of employees. in the grade-that is the number you have in there at this time, I take it? Mr. BARUCH. That is right. Senator LONG. Not the number you would have in there? Mr. BARUCH. That is right. We estimate for purely cost purposes and this is only a guess-that there would be 400 employees in grade GS-16 eventually-not initially when the bill takes effect, but eventually, and about 200 in grade 17 and about 100 in grade 18, and about 50 in grade 19. Part of those employese would be officials or scientists or professional men who are now in grades P-8 or CAF-15 and who would be getting a maximum of $10,330. Part of them also would be officials or scientists, or professional men who are not now under the Classification Act, who would be brought in under the provisions of title II, and who may be getting more than $10,330. Senator LONG. As a matter of fact, the Army, Navy, and Air Forces have about 46? Mr. BARUCH. Forty-five such positions. Senator LONG. Forty-five positions that go over $10,000 at the present time. I do not see those indicated on this chart. Mr. BARUCH. No, sir; they are not now under the Classification Act. What you are referring to, Mr. Chairman, is Public Law 313, as amended, of the last Congress, I believe. That provides that in the National Military Establishment there can be 45 positions: 13 for Navy, 13 for Army, 13 for Air Force, and 6 for the Office of the Secretary of Defense which Senator LONG. You have to give the NACA 10 positions. Mr. BARUCH. That is right, sir. Those would be authorized by pending bill H. R. 20. Public Law 313 provided that those 45 positions, sir, may be paid, as you indicated, higher than the present ceiling of the Classification Act, from $10,000 to $15,000. The Civil Service Commission must approve the salary recommended by the department and also this is important for those higher gradesthe Commission must also approve the qualifications of the proposed appointee. Actually, the National Military Establishment, up to now, is not up to its 45 quota. I might say for the record that Public Law 313 which had some possibilities of abuse on its face has been very carefully administered by the National Military Establishment and has worked out very well indeed. Senator LONG. How many do they have in the NME at the present time to fill those 45 positions? Mr. BARUCH. Probably about 30 at the present time. When I testified on H. R. 20, the NACA bill in the House, there were 25 at that time. There have been about five additional ones, I think, filled since then. Senator FLANDERS. I was just going to ask: When you get your 400, 200, 100, 50, does it include these 45 in the additional ones? Mr. BARUCH. Yes, sir; that was taken into consideration. They would be merged into this schedule, provided, Senator, that the schedule as enacted runs high enough so as not to interfere with the proper operation of Public Law 313. If these rates were not approved, we would recommend that Public Law 313 be continued and that H. R. 20 be enacted as a separate piece of legislation. Senator LONG. If this bill is passed, would there be any necessity of passing H. R. 20 or would this bill take care of it? Mr. BARUCH. This bill would take care of H. R. 20 and I think the boys from the National Advisory Committee on Aeronautics agree on that also. Senator LONG. Suppose we passed both of them? Would this supersede both of them? Mr. BARUCH. If this bill were passed. Senator LONG. H. R. 20 is on the calendar in the Senate now. Mr. BARUCH. If H. R. 20 should pass more promptly than this bill would, and this bill would come along later, this bill would supersede H. R. 20. Senator LONG. Would it also supersede Public Law 313 of the previous Congress? Mr. BARUCH. Yes, sir. The point that we make sometimes is that a general approach of this type for the higher brackets is much more beneficial to the Government service as a whole than a series of individual pieces of legislation. When we do things for the National Military Establishment and the National Advisory Committee for Aeronautics, we may wonder what about the National Bureau of Standards and what about the research organizations under the Agricultural Research Administration of the Department of Agriculture? A series of movements for piecemeal legislation eventually means that someday all that has to be brought together in one general piece of legislation to avoid confusion and destructive competition among the departments. This bill proposes to tackle the same problem that gave rise to Public Law 313 and H. R. 20 on a more generalized basis. Now, you will observe in the GS schedule, particularly by reference to the summary at the end of table No. 3, a considerable variation in the individual rate increases. It is on page 5, table No. 3, the first dittoed table. The middle block of the columns is entitled "Individual increases." If you look there, you get a pretty clear picture of the variation of individual rate increases. You will observe that the individual rate increases vary from $1.72 a year to $670 a year within grades GS-1 to GS-15. Also, if you will look at the column entitled "Average", meaning the average initial individual increases, you will observe that as you go toward the top of the schedules, the average increase becomes larger. For example, between GS-1 and GS-8, the average varies from $10.55 a year to $95.60 a year. Then, in the next block of grades from GS-9 to GS-14, the individual rate increases vary from $119.63 to $230.68. The average in GS-15 is $482.11. Senator LONG. Let me ask you a question. This would have the effect, then, would it not, generally speaking, to broaden the gap between those positions. In other words, usually the tendency is over a period of time, everybody gets on the same pay scale-what you are trying to do is telescope it out and have more steps. Mr. BARUCH. Yes; that is because of what the previous salary adjustment acts have done. So you get the picture very clearly, Mr. Chairman, that the general theory back of these schedules is to take hold of them about the middle somewhere and stretch them out toward the top, holding the bottom part of the rubber band about where it is. Senator LONG. You propose to give them a small increase? Mr. BARUCH. It is small compared to the increases in the middle and the upper brackets. Senator FLANDERS. The reason for that is that? what is the reason for Mr. BARUCH. The reason for favoring the middle and the higher brackets is the past adjustments that have taken place. Now, if I may go over the recent history of pay adjustments of the rates of pay under the Classification Act, and show briefly what their effect has been in terms of percentage increases. This act was passed on March 4, 1923, and the initial pay scales became effective July 1, 1924. There were some changes in 1928 and 1930. Coming up to recent times, the only increase between 1930 and July 1, 1945, a period of 15 years, including wartime, was a small increase in grades SP-1 and SP-2, which was designed to bring up the minimum rate of the scales from $1,020 and $1,080 to $1,200, and increases in grades 1 to 8 of the CPC service. The rest of the CPC service, the rest of the subprofessional service, the whole CAF, the whole professional and scientific service, were not increased so far as basic salary rates were concerned between 1930 and July 1, 1945, although there was increased take-home pay between December 1942 and July 1945 because of overtime based on longer hoursgenerally a 48-hour week. On July 1, 1945, the Federal Employees Pay Act of 1945 became effective. That had a formula for pay increases which ran like this: There should be added to each existing rate of pay 20 percent on the first $1,200, 10 percent on the next $3,400 and 5 percent on the remainder, with a proviso that by reason of that law nobody should have his salary increased beyond $10,000. The average increase under that law was 15.9 percent. The range of the increases was from 20 percent at the floor to 8.9 percent at the ceiling. So you can see there was a sliding scale squeezing the top toward the middle and toward the bottom. In 1946, the effective date being July 1, the Federal Employees Pay Act of 1946 was enacted. That provided an almost uniform increase of 14 percent across the board. It provided that the 14 percent rate should not give a man any less than $250 except that no rate was to be increased more than 25 percent. It also provided a $10,000 ceiling. The average increase was 14.2 percent and the range of increase was from 25 percent at the very bottom to 2 percent at the ceiling. Thus again there was a sliding increase with the lowest percentage at the top. On July 11, 1948, the Postal Rate Revision and Federal Employees Salary Act of 1948, Public Law 900 of the Eightieth Congress, became effective. That provided a $330 flat increase which was an 11-percent average increase; but the increase ranged from 30.6 percent at the very bottom to 3.3 percent at the ceiling. A sliding scale again with the lowest percentage up toward the top. The over-all effect since 1945 on the full range of the pay scales from the bottom of CPC-1 to the top of P-8 or CAF-15, is a series of increases varying from 95.8 percent at the floor to 14.8 percent at the ceiling. Or if we do not take the very bottom of the schedules— which is grade CPC-1, for messenger boys and girls, if we start at the adult floor, as we call it, CPC-2, the range of over-all increases since June 30, 1945, is from 68.3 percent at the bottom to 14.8 percent at the ceiling. Now, the objective of the bill is to undo or adjust, not entirely but to an extent regarded as feasible, the squeezing effect of previous salary adjustments since 1945. Senator LONG. If you divide these pay grades, I would say just about in the middle, you have GS-9, or if you would leave the GS-9 out, you would have just about the same amount being given those below GS-9 as those above, even the great majority above that. Mr. BARUCH. The great majority. Senator LONG. Taking GS-1 through 8. Mr. BARUCH. The majority are below GS-9. As a matter of fact, in terms of salary, half of the employees get less than $2,874 and half get more than $2,874. That is the middle point at which the group splits. GS-9 under this schedule would pay a minimum of $4,600. According to our present distribution. figures, 85 percent of the employees would be below $4,600; 15 percent above. So the great bulk would be below the GS-9 level. Senator LONG. That is right. In other words, they are GS-1 through 8. Mr. BARUCH. That is right, sir, and almost all of the employees in CPC would be below the pay level for GS-9. Senator LONG. Out of the aggregate amount of increases, it would appear to me that starting at GS-9 and coming forward, that is the area where most of the amount of increase takes place. Mr. BARUCH. That is right, sir, because that is where the lesser part of the increases took place between 1945 and 1948. Senator LONG. Let me see if I understand the logic of this now. Your position is that these lower-paid employees have been pretty well taken care of now, that their salaries are pretty much in line with what they ought to have. I notice their increases vary anywhere from an average in the lowest, you might say, $1.72, to the highest of $96.60. Mr. BARUCH. That is right, in grades GS-1 to 8. Senator LONG. Yes. Those average fairly low, it would appear to me. Is the theory of that that these people are being pretty well paid the way it is now, is that the idea? Mr. BARUCH. No, sir; the Commission has not taken that position. The Commission's position is that this is not a cost-of-living-increase bill. Mr. Winslow can probably testify more reliably than I can on the attitude of the administration on this point; but my understanding is that the administration's viewpoint is that any increase which is to recognize the change in the cost of living since 1939, or any other date, should, so far as Classification Act employees are concerned, be worked into this bill. In that way we would get both whatever the committee regarded as a fair increase for both lower-paid and higherpaid employees, and also the very desirable administrative contribution which the committee could make, namely, a complete revision of the Classification Act and its operating provisions. Senator FLANDERS. This is primarily a revision proposal that you are presenting? Mr. BARUCH. Yes, sir. If I may offer a suggestion, this would be the basic structure for the committee to consider in deciding what other pay scales might be more appropriate. Senator LONG. I see. Let us see if I understand you further. Your idea would be, then, that if this committee was to attempt to make some cost-of-living adjustment, that the adjustment Mr. BARUCH. Within the structure. Senator LONG. You should first get this structure into effect where each person, to your way of looking at it, would be getting proportionately what you thought they should receive and from that point forward you should proceed to spread over the whole group. But that in effect, each pay scale, and each pay scale getting their proportional increase instead of one group getting, let's say, a 30-percent increase, and another group getting a 3-percent increase. You feel |