A state workers group is seeking a one-time bonus of $1,000 for state employees who haven't had an across-the-board pay increase in more than six years.
Sterling Zearley, executive director of the Oklahoma Public Employees Association, said the bonus would go to workers who meet or exceed standards set by their state agencies.
Zearley said he expects about 90 percent of the state's approximately 34,000 state employees would qualify for the bonus. The estimated cost is between $25 million and $35 million; the bonus would not be for those who work for higher education or public schools.
The bonus would help employees deal with cost-of-living increases that have occurred since their last raise, he said, and would serve as an incentive for workers while legislative leaders move away from granting across-the-board raises to pay increases based on job performance.
“Across-the-board increases are a relic of the past,” said House Speaker T.W. Shannon, R-Lawton. “We need to really start focusing on market-driven principles in state government.
“We probably need to have a complete review of how we get there,” he said.
Shannon said he understands some state workers are underpaid, “but we need to be rewarding our very best. We need to be incentivizing good behavior and the best way to do that is to come up with a market plan that encourages good behavior and encourages best-market practices.
“This idea of continuing to pay people based on this 19th century model solely based on years of experience — we've got to get away from that,” he said. “I'm hopeful we can begin that discussion and start coming up with that model this year.”
Following the lead
Zearley said he is working with Rep. Leslie Osborn, R-Mustang, on developing legislation to develop a market as well as appropriate money to pay for a market-based pay system. She has filed House Bill 1717, but it contains no substantial language.
He is hoping Oklahoma follows the lead of states such as Utah and North Dakota that hired an outside firm to develop an employee compensation study. Oklahoma lawmakers approved developing a plan in 2008. Effects of the national recession rolled into the state the next year, funding for state agencies was cut and the plan never was developed.
“We're looking at a two-pronged approach,” Zearley said. “You've got to look at the job first and you try to get positions close to … the private sector. Once you get those individuals in there and if they perform at high standards you need to have a pay performance mechanism in place.”
Employees performing well would get a bonus, he said. Their base salary would not increase.
The plan likely wouldn't be developed until after lawmakers adjourn their session in late May, he said. It would take three to five years to implement the plan and get salaries adjusted
“We can't wave a magic wand and fix the problem overnight,” Zearley said.
The $1,000 bonus this year would provide immediate relief for state employees in crucial public safety areas, he said. The Corrections Department is seeking $12 million for pay raises and the Oklahoma Patrol is asking for $7 million to boost trooper salaries for the 2014 fiscal year, which begins July 1. It's estimated lawmakers will have an additional $170 million this year to craft the state's nearly $7 billion legislative appropriated budget.
The last across-the-board increase for state employees was a 5 percent increase in October 2006. Zearley said employees have been asked to do more since then, either because of layoffs the past couple of years as a result of an economic downturn in the state or because of agencies having trouble filling the budgeted posts they do have. About 3,800 state jobs have been cut since 2009; the 34,000 state employees are the same number of state workers as in 1983.
“Since we have had not a raise since '06, we're asking for this one-time, $1,000 pay performance payment,” he said.
Zearley, whose organization represents about one-third of the state's approximately 34,000 employees, said the state would be able to keep more qualified employees if it could bring salaries closer to what is being paid for similar jobs by private companies.
Competitive market compensation for state positions and pay for performance are essential for a trained and knowledgeable workforce, he said.
Increasing pay for state workers partially could be funded from savings by having lower turnover, he said. Oklahoma's 13 percent turnover rate costs the state about $90 million in training employees to replace workers who retired or quit.
State employee salaries are about 19 percent below those paid for similar jobs in the private sector, Zearley said.
The lack of a recent pay increase and higher pay offered by private companies are main reasons for the state's turnover rate, which is more than twice the 5 percent rate considered ideal, according to the state's personnel office.
Many state employees are leaving for the energy field, where accountants, engineers, truck drivers and oil rig workers are needed, Zearley said.
A correctional officer's starting salary is $11.83 an hour; oil-field workers can earn as much as $25 an hour, Zearley said.
Employees working in jobs that are in high demand could be given a pay differential on top of their base salaries, he said.
A new compensation plan should cover all state agencies so there is consistency in how pay raises are administered, Zearley said.
Agencies that don't receive money appropriated by legislators have had available funds and have given raises since the last across-the-board increase in 2006, he said. Some agencies have used available funds to grant an increase in pay to some of their employees since then as well.
“We're not being consistent across the state,” Zearley said. “We need a pay plan for the whole state.”