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STATEMENT OF THE HONORABLE DANNY K. DAVIS
AT THE SUBCOMMITTEE ON CIVIL SERVICE
AND AGENCY ORGANIZATION
HEARING ON

Federal Law Enforcement Personnel in the Post 9/11 Era:
How Can We Fix An Imbalanced Compensation System.

Wednesday, July 23, 2003

Chairman Davis, federal officers, in varying degrees and capacities, uphold the Constitution and protect the public welfare. Over the years, however, there has been much debate and controversy, with no permanent resolution, on which types of federal employees should be classified as “law enforcement officers," and as such, should receive enhanced pay and retirement benefits.

In 1988, the Anti-Drug Abuse Act established the National Advisory Commission on Law Enforcement (the Commission) which studied the pay, benefits, and other issues related to the recruitment and retention of employees defined as "law enforcement” under federal retirement laws. The Commission's report, which was released in April 1990, made several recommendations for interim pay enhancements for law enforcement officers and suggested that the Office of Personnel Management (OPM) conduct a further study on the need for a new pay system for federal law enforcement.

The Commission's report did note, however, that the statue defining "federal law enforcement officer" was broad, encompassing both traditional positions within the field and less traditional positions not generally considered part of the law enforcement

community.

As recommended by the Commission, Congress enacted the Federal Employees Pay and Comparability Act of 1990 (FEPCA), which enhanced law enforcement pay and

directed OPM to conduct a study of the pay and job evaluation for federal law enforcement officers. OPM, along with a 45-member advisory committee drawn from law enforcement agencies and employee groups, produced in September 1993 a report entitled, “A Plan to Establish a New Pay and Job Evaluation System for Federal Law Enforcement Officers. Two months later, the Subcommittee on Post Office and Civil Service held a Subcommittee hearing on the report and its findings.

At that hearing, Ms. Barbara Fiss, who testified on behalf of OPM stated, “OPM determined at the outset that the definition of law enforcement officer used in the FEPCA

provisions, based on retirement law, needed to be examined because it covers employees whose primary duties included such diverse jobs as health care, accounting, and cooking; but excluded employees whose primary duties include maintaining law and order and protecting, property and the civil rights of individuals. OPM's fact-finding visits confirmed OPM's belief that the coverage issue had to be reconciled."

In a hearing this Subcommittee held on this same subject in 1999, OPM said much the same thing. William Flynn, at that time Associate Director for Retirement and Insurance at OPM, testified at the hearing that, "We believe that to simply consider whether to add certain specified groups to coverage under the existing provisions is much too limited an inquiry. Instead, it is time to reexamine the program and its history. We must first determine what human resources management needs should be addressed. Then, we must analyze how those needs can best be addressed in a cost-effective manner that is fair to both employees and the taxpayers."

This subcommittee is again holding a hearing on the classification and pay of federal law enforcement officers with no comprehensive solution to the problem.

Determining the definition of a federal law enforcement officer is clearly a very complex

and controversial issue. This hearing is an opportunity for us to revisit this issue and

find permanent solutions to concerns that have been raised in the past and that are still

lingering today.

Question:

Answer:

"Federal Law Enforcement Personnel in the Post 9/11 Era:
How Can We Fix an Imbalanced Compensation System?”

OPM's Responses to Follow-up Questions from the
House Subcommittee on Civil Service and Agency Organization

I understand that OPM has traditionally insisted that pay enhancements
should be used to compensate for the hazards employees face and that
special retirement benefits should not be used for that purpose, but rather
to encourage earlier retirements, which in turn benefits the organization by
ensuring a young and vigorous workforce. If this is still the case, please
explain your thinking in this area.

There are various forms and degrees of hazard encountered by different
employee groups. Because of these variations, OPM has consistently
stated that the best way to compensate employees for hazards encountered
in employment is through the pay-setting process. The legislative history
on law enforcement retirement benefits clearly indicates that law
enforcement retirement benefits were intended to be a workforce
management tool to maintain a young and vigorous workforce through
youthful career entry, continuous service, and early separation. Several
provisions in the law work in combination to accomplish these goals.
These provisions include the authority for agency heads to set a maximum
entry age (typically 37) for law enforcement officers (LEOs), early
retirement with an enhanced annuity computation, and a mandatory
separation age (typically 57). The enhanced annuity formula, which
consists of a higher per year accrual rate than applies to regular
employees, was added to the law in 1974 to enable application of a
mandatory retirement requirement without economic hardship to affected
individuals.

If the statutory scheme (i.e., maximum entry age, early retirement with an
enhanced annuity, and mandatory separation) is altered, this raises the
issue of whether the LEO early/enhanced retirement program is serving as
a workforce management tool or merely as a reward for certain types of
work. If, for example, LEOs are expected to enter employment beyond
37, to work longer, or are not subject to early retirement or mandatory
separation, it becomes increasingly difficult to explain an enhanced
formula designed to compensate an employee for a shortened career.
Rather, it becomes a reward for certain types of work. Therefore, if LEO
retirement benefits are to be retained as a viable program, the goal of the
program must remain the management of law enforcement workforces for

swer

Question:

Answer:

Question:

Answer:

You have stated that the purpose of law enforcement retirement is the maintenance of a “young and vigorous” workforce. Does the statutory scheme of maximum entry age, mandatory retirement, and early retirement actually create a young and vigorous law enforcement workforce?

Yes. The retirement section of OPM's June 30 report to Congress
(Appendix I) contains a statistical analysis of selected employee groups
with and without LEO retirement coverage. The statistical analysis
indicates that groups with LEO retirement coverage are, on average,
younger than groups without LEO retirement coverage. OPM's analysis
indicates that 75 percent of selected employee groups with LEO coverage
are younger than 45, while only 57 percent of the selected employee
groups without LEO coverage are under age 45.

We have a continuing problem, as you know, with piecemeal solutions to Government-wide issues. If Congress were to require from OPM a report with options and recommendations for a comprehensive solution to the current pay and benefits disparities of law enforcement personnel across Government, could you do it and do you think that would be helpful?

Your interest in options for a comprehensive solution to the current pay and benefits disparities applicable to Federal law enforcement personnel coincides with OPM's current joint responsibility with the Department of Homeland Security (DHS) to develop a new pay system that will cover many LEOs. Section 881 of the Homeland Security Act of 2002 (Public Law 107-296, November 25, 2002) required that the Secretary of Homeland Security, in consultation with the Director of OPM, submit a plan to Congress for ensuring the elimination, to the maximum extent practicable, of unwarranted disparities in the pay and benefits of employees being transferred to DHS. In response to this requirement, DHS submitted a report to Congress on March 5, 2003, providing information on possible disparities warranting further review.

That report pointed out that the issue of pay and benefits disparities is
integral to the design and establishment of a new Human Resources
Management (HRM) system for DHS employees, as authorized under 5
U.S.C. 9701 (enacted by Section 841(a)(2) of the Homeland Security Act).
The report further stated that it would be premature to make

recommendations regarding the resolution of possible disparities, since
DHS and OPM intend to propose new HRM systems for DHS later this
year, after collaboration with key stakeholders, including employee
representatives.

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