Government Keeps Commitment on Pay-for-Performance
PUBLIC SERVICE COMMISSION--Government Keeps Commitment on Pay- for-Performance
The Nova Scotia government is keeping its commitment to provide management employees with pay for good performance. The new compensation package will bring Nova Scotia in line with other provincial governments.
"Three years ago, we told Nova Scotians we would base a portion of compensation for senior officials on performance. Now that the budget is balanced, we have the resources to deliver on that commitment," said Ernest Fage, Minister of the Public Service Commission. "Taxpayers expect and depend on good management of all our public services, and keeping this commitment is a very tangible way of promoting that."
Pay-for-Performance will be made available this fall to eligible employees in the Management Compensation Pay Plan (MCP) and designated senior officials who had good results on their 2001-02 performance appraisals.
The plan will recognize individual performance of managers and other professionals paid under MCP, and includes the potential to earn pay for good performance of their entire department and government as a whole. Government's 2002-03 budget includes $2 million for the initiative.
"This program will reward those who perform well and are accountable for their results," noted Mr. Fage.
The amount of pay for each person who qualifies will depend on a variety of factors, including the number of people who will share the fixed budget.
"Pay-for-Performance focuses managers on both meeting individual performance targets and achieving the objectives set by their departments and government," said Mr. Fage. "The taxpayer will ultimately benefit, as every manager will be looking at specific ways to make government services more efficient and cost- effective."
The new system ensures that management employees move through their salary scales in a way that is comparable to unionized employees, who get regular step increases according to their collective agreements. Mr. Fage noted that merit pay, a precursor to Pay-for-Performance, has been offered to Government of Nova Scotia managers only three times in the past decade and about a third of managers have not had other pay adjustments.
Pay-for-Performance is intended to be an annual initiative, although government will have the discretion to adjust its overall budget every year.
The program will be a key tool to help attract and keep employees who might otherwise work in the private sector or in other public sector jobs. Pressure to recruit and retain management staff is increasing in all sectors as the aging workforce moves through to retirement.
Most provincial governments have some version of management-level performance pay. At the deputy level, a pay-for-performance system is used in three provinces, two territories and the federal government. Performance incentives are common in the private sector.