TODER CLASSIFICATION ACT OF 1949 the executive branch specifically referred to ze in law made by section 305 of this Act e Federal Executive Salary Schedule pursuant sa maced in the appropriate grade of the General Latif 1949, as amended, in accordance with the G PROVISIONS by this Act, the changes in existing law made fice or position existing immediately prior to es in existing law, the compensation attached 24 neumbent thereof, his appointment thereto, empensation attached thereto, until appro***nce with this Act or other law. L rsion of this Act, the rate of basic, gross, or total any officer or employee immediately prior to the a tall not be reduced by reason of enactment of -FEDERAL JUDICIAL SALARIES ere as the "Federal Judicial Salary Act of 1964". aste compensation of officers and employees in or Government whose rates of compensation are 2 of subdivision a of section 62 of the Banksection 3656 of title 18, United States Code, 3. section 604(a) (5), or sections 672 to 675, Ss Code, are hereby increased by amounts which sencreases provided by title I of this Act in estion for officers and employees subject to the mended. e or applicable law on the effective date of this ete salaries payable to secretaries and law Craigs are hereby increased by amounts which recie nereuses provided by title I of this Act in corresea for officers and employees subject to the Classive & United States Code (relating to the compensade escrier courts), is amended by striking out the existde Derein and inserting a new limitation which ppcole increases provided by title I of this Act in Compensation for officers and employees subject to the *suttenied. M. Super Act (11 U.S.C. 68(a)), as amended, relating e and part-time referees in bankruptcy, is amended smpensation limitations contained therein and inWand “$11,000", respectively. Live United States Code, relating to the salaries Cuted States and of the Associate Justices of the ted States is amended by striking out "$35,500" and v, and by striking out "$35,000" and substituting e United States Code, relating to circuit judges is Q" and substituting therefor "$33,000". United States Code, relating to district judges, is 210" and substituting therefor "$30,000", and by Faai suosetuting therefor "$30,500". United States Code, relating to judges of the Court Nrking out "$25,500" and substituting therefor De Suited States Code, relating to judges of the Court is amended by striking out “$25,500" and substi e N United States Code, relating to judges of the > griking out “$22,500" and substituting therefor ། Scheerand t i sci & #2 R Izod States Code, relating to the evergensiDa ₫ NCLssioners of the Court of Caims, is amended to read as follows: - Eid semissioner stall receive basic congensation at the rate of $27.000 a year, and dS: 1 DAYSULT INV Cræenses and a per diem allowance as provided in the thre Ares de f 1969 as amended, while traveling on ofdibszess and away from Washington, District of CommNa.” 1 Section Tess of the Internal Revenue Code of 1984 (6SA STAT. 879), as amended relating to judges of the Tax Court of the United States, is further amended by striking out "300" and substituting theever “$30,000", (5) SectionMANof title 10 United States Code, relating to judges of the Court of Millary Appeals, is amended by striking out “£25000" and sub stituting therefore "$55,000", TITLE V-EFFECTIVE DATES SEC. 501. (a) Except to the extent provided in subsections (b) and (e) of this section, this Act and the increases in compensation made by this Act shall become effective on the first day of the first pay period which begins on or after the date of enactment of this Act. (b) Section 204 of this Act, relating to increases in compensation for Moms bers of Congress, shall become effective at noon on January 3, 1965, (e) Notwithstanding any other provision of this Act (but except as other wise provided in subsection (b) of this section )—— (1) no rate of compensation which is equal to or in excess of $22,000 per annum shall be increased in any amount, by reason of this Act until the first day of the first pay period which begins on or after January 1, 1963; and (2) no rate of compensation which is less than $22,000 per annum sħall be increased to an amount per annum in excess of $22,000, by reason of this Act, until the first day of the first pay period which begins on or after January 1, 1965. The CHAIRMAN. We are limited in time by the debate in the Senate Chamber this morning. Further hearings will be scheduled for Thursday, May 7, 1964, at the same time, 9 a.m. Our witnesses this morning are the Honorable John W. Macy, Jr., Chairman of the U.S. Civil Service Commission, and the Honor able Elmer B. Staats, Deputy Director of the Bureau of the Budget, I appreciate your appearing here this morning and I hope that everybody will be on time on Thursday, too, so we may proceed immediately after 9 o'clock. The first witness will be the Honorable John W. Macy, Jr. Will you please proceed, Mr. Macy? STATEMENT OF HON. JOHN W. MACY, JR., CHAIRMAN, U.S. CIVIL SERVICE COMMISSION Mr. MACY. Thank you very much. Mr. Chairman and members of the committee, I appreciate the opportunity to appear before you again in support of much needed adjustments in Federal pay. In order to conserve your time I shall not repeat my earlier presentation, on September 4, 1963, of the detailed factual information showing the gap between Federal and private enterprise salaries and the manner of developing Federal salary schedules which would close this gap. I shall certainly be glad to answer any questions you may have on this matter, but my principal objective at this time is to stress the urgent need for early action on appropriate pay legislation to meet legislative commitments and operating requirements. This urgency was forcefully expressed by President Johnson in his letter of March 17 to the Speaker of the House urging the House to reconsider and approve legislation to adjust Federal salaries. He emphasized that failure to act would undercut the principle and the promise of comparable pay-Federal career pay scales comparable to those in private industry-adopted by the Congress just a year and a half ago in the historic Federal Salary Reform Act of 1962; thwart our efforts to strengthen professional and technical leadership and step up productivity of Federal workers and make it harder than ever to recruit and hold the outstanding people we need for our top policy jobs. Again, at his news conference on April 16, 1964, the President stated that the pay bill is one of the most important pieces of legislation to continued good government in this country. I have on my desk today a number of resignations from some of the very best men in Government who tell me that they cannot stay any longer-they've been here 3 years and cannot stay any longer at present salary. *** I think that we're going to lose some of the best men in Government. Like sergeants that run the Army, some of the Under Secretaries and Assistant Secretaries are the men who do not get the notoriety but do the hard work from day to day. I think they're entitled to a raise, and I hope the Congress will consider the bill in hoth committees. During the past week, Mr. Chairman, an Under Secretary has departed, and the President has confirmed that the Chairman of the Council of Economic Advisers is planning to leave at a later date. With respect to the four career, statutory salary schedules, the Federal Salary Reform Act of 1962 prescribes the twin principles that (a) There shall be equal pay for substantially equal work, and pay distinctions shall be maintained in keeping with work and performance distinctions; and (b) Federal salary rates shall be comparable with private enterprise salary rates for the same levels of work. I wish to emphasize, as I have many times, that the career schedules which became effective in January as schedule II of the 1962 Salary Reform Act provided limited comparability, extending only through grade GS 7 of the Classification Act schedule and based upon the Bureau of Labor Statistics survey of 1961. Thus these schedules do not now represent comparability and until these schedules are corrected the vital principle of the Salary Reform Act is not being carried out. The Administration has endorsed the provisions of H.R. 11049 which is being reported by the Post Office and Civil Service Committee of the House of Representatives, as an effective move toward comparability in career pay levels and rates. Schedules proposed in H.R. 11049 for the four statutory systems represent comparability at the lower career levels and substantial progress toward comparability at the upper levels. Enactment of these schedules would reaffirm congressional support for the sound principle that Government pay should be kept comparable with pay like work in the private economy, and for the process of periodic re for VIEW KNÈ KONĽopriate ac iustmem that is essential if the principle is to TAMENT LIVALIing more than a few lines of print, Last Servzember. I presented the 1962 surver findings and analyses of dana which were the basis for the schattles that the late President Kennedy had transmrad to Congress on April 29, 1968, under proceCares established by the 1982 Reform Act. Although hased on those schedules, the rates proposed TL 1.2. 1749 are somewhat higher for the lower grades and some vihta iz wer for the higher grades. Specially, EL 24 renses by 7 percent over President KonDACT'S PROPOSE the rites for levels PPS through PFS 4 of the postad schedule and G-1 through GS3 of the Classification Act schedule. Increases of 2 and 1 percent, respectively, at the next two levels of each schedule taper of the b-percent increase of the lower levels. This increase at the lower grades is intended to take into aðcout the rise in private enterprise salary levels that has occurred since the 1962 Bureau of Labor StaDSUS SKIVEN, The bill has a single rate of $24,500 for GS-18, less by $2,000 than the $25,000 rane the Presidenti had recommended in April 1968. Decreases at the other higher levels are of smaller amounts, do¤% TO ŠIJA for example, a grade GS-S From an operating and administrative standpoint, the lack of a salary adjustment in 1965 has resulted in an exceptionally critical need for relief at the upper grades. When schedule II of the Salary Reform Act became effective in January of this year, it created an intolerable situation at the top three Classification Act grades. The act did not provide increased schedule II rates for grades GS 16 GS-17. and GS-15 as it did for all other grades. The omission was deliberate, in anticipation that legislation based on consideration of the entire executive pay problem would be enacted in 1963 before schedule II took effect. Since schedule II became effective: -The top three rates of GS-15 exceed the highest rate of GS-46 -The highest rate of GS-15 is more than the third rate of -The maximum of GS-15 is only $730 less than the maximum. These extraordinary pay relationships have some startling effects. For one, supervisors are paid less than their subordinates-niore than 2,000 employees in GS-15 receive salaries in excess of the top rate of GS-16. In the Department of the Army, for example, 413 persons are paid at GS-15 rates higher than the top rate of GS-16. In that National Bureau of Standards 18 scientists and engineers in GS-13 receive sal aries above those received by the 15 who are at the top of GS 16 and more than those received by 20 of the 21 top Bureau scientists in grade GS-17. There is an even more startling result of freezing the salary rates for grades GS-16, GS-17, and GS-18 at the schedule I level: a person promoted from the upper GS-15 rates to grade GS 16 would have to take an actual cut in pay. The Comptroller General has ruled, and I see no reason for questioning the ruling, that individuals promoted to Grade GS-16 from the top three rates of GS-15, which are $18,240, $18,755, and $19,270, must have their salaries reduced to the $18,000 maximum rate of GS-16. I am sure you will all agree that it is an incredible situation in which the assignment of heavier responsibilities to an individual, and his promotion to a higher grade, is accompanied by a slash in his pay. One effect of the GS-15 overlap of depressed GS-16 rates in schedule II explains the need for the special rule in section 102 of H.R. 11049 for conversion of certain rates when new rates for GS-16 take effect. Under schedule II, all those who may have been promoted from the third, fourth, fifth, sixth, seventh, and eighth rates of GS-15 cluster at the fifth rate, which is the top, of GS-16. To remedy this unpremeditated pay compression of those who had widely varying lengths of service in GS-15, the special conversion provision would place all those promoted to GS-16 while schedule II is in effect at the rate of the new schedule to which they would have gone if the new schedule had then been in effect. In connection with proposed salary rates for the upper GS grades I cite again the findings of a special study in the Commission last brought up to date in 1962, which covered 88 positions in 19 large corporations. The following were the middle rates of those paid by the corporatons for positions equivalent in responsibility to Federal positions in the top three GS grades: For positions equivalent to GS-16_. $28,000 35, 500 44, 500 Although these are illustrative rather than statistically derived national average rates, they demonstrate that the proposed rates for grades GS 16, GS 17, and GS-18 are far below those commonly paid today by large business organizations. And these comparisons from private industry are not for top corporate officer jobs; they represent stead the regular career salaries for such posts as plant manager or chief engineer, well below the officer level. A continuing solution for the upper grade salary problem of the Classification Act and other statutory schedules is dependent on executive pay reform; that is, adoption of more adequate salary levels for Cabinet officers, agency heads, and related Presidential appointees. Any approach omitting reform of top executive pay is at best a very short range stopgap and merely postpones a solution. Action on executive pay is essential not only to alleviate the immediate situation at the very top GS grades, but also to overcome the sag below private enterprise comparability levels which now extends down through tu previous testimony, Mr. Chairman, before your committee in September, I mentioned the recommendations of the President's Advisory Panel on Federal Salary Systems, the Randall Panel. The principal recommendations for the executive agencies were a six-level Salary schedule and salary rates ranging from $50,000 for Cabinet secretaries, who wou'd be at level I, to $30,000 for heads and board members of sana "ler agencies, who would be in level VI. |