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Performance-based pay raise system is sought for Oklahoma's state employees

Legislative panel is urged to develop performance appraisals for Oklahoma's 34,000 state employees and to work to bring each state job up to at least 80 percent of what workers are paid in the private sector.
BY MICHAEL MCNUTT Modified: October 23, 2012 at 9:56 pm •  Published: October 24, 2012

Pay increases for state employees should be based on performance appraisals instead of across-the-board increases, a legislative panel was told Tuesday.

Rep. Leslie Osborn, who conducted Tuesday's study before the House of Representatives Appropriations and Budget Committee, said she plans to file legislation to be considered next year that would establish performance appraisals and evaluate jobs so that state positions are paid 80 percent of what is paid by private companies.

“We need to look at are we paying our employees something that is relatively close to market, something where we can recruit and retain the best members to run our core services,” said Osborn, R-Mustang. “I personally believe we can find the dollars to fund it.”

The last across-the-board increase for state employees was a 5 percent increase six years ago, and benefits since then have been gradually reduced, said Sterling Zearley, director of the Oklahoma Public Employees Association.

Many state employees are asked to do more 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, Zearley said.

About 3,800 state jobs have been cut since 2009, he said. About 34,000 employees, or the same number of state employees as in 1983, work for various state agencies. That number does not include those who work for higher education or public schools.

Osborn said she also likes the idea of a $1,000 bonus in the next fiscal year for state employees who meet or exceed standards.

Osborn, who filed legislation this year to cut the state's top personal income tax rate of 5.25 percent to 2.25 percent and eventually eliminate it, said she plans to try again next year to lower income taxes.

“It can all work together,” she said.

Osborn said she's working on a more moderate version, which would reduce the income tax rate to 4 percent if there is certain growth in state revenue.

Committee Chairman Earl Sears said the state, which saw actual revenue growth for this fiscal year's budget for the first time in four years, should consider increasing employee pay.

Sears, R-Bartlesville, said he is optimistic revenues again will increase for the 2014 fiscal year, which starts July 1. Lawmakers will get their first idea of how much money is available to spend when the first revenue estimate is made in December.

“At least if we have some money, we need to start looking at what we can do for salaries, benefits,” he said. “I personally would like to tie it to performance merit, not across-the-board. The days of just straight across-the-board raises are just no longer the standard.”

Sears and Osborn said they would consider an across-the-board cost-of-living increase until a performance appraisal system is fully in effect.

Focus on performance

State Finance Secretary Preston Doerflinger said he opposes across-the-board raises and longevity-based pay but supports an appropriate level of compensation based on performance appraisals.

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