[Federal Register Volume 77, Number 113 (Tuesday, June 12, 2012)]
[Proposed Rules]
[Pages 34854-34855]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2012-14274]
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Proposed Rules
Federal Register
________________________________________________________________________
This section of the FEDERAL REGISTER contains notices to the public of
the proposed issuance of rules and regulations. The purpose of these
notices is to give interested persons an opportunity to participate in
the rule making prior to the adoption of the final rules.
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Federal Register / Vol. 77, No. 113 / Tuesday, June 12, 2012 /
Proposed Rules
[[Page 34854]]
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OFFICE OF PERSONNEL MANAGEMENT
5 CFR Part 532
RIN 3206-AM63
Prevailing Rate Systems; Special Wage Schedules for
Nonappropriated Fund Automotive Mechanics
AGENCY: U.S. Office of Personnel Management.
ACTION: Proposed rule with request for comments.
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SUMMARY: The U.S. Office of Personnel Management is issuing a proposed
rule to establish special wage schedules for the Department of
Defense's (DOD's) nonappropriated fund (NAF) automotive mechanics.
These special wage schedules would replace the current commission pay
practice covering DOD's NAF automotive mechanics with a flat rate pay
system. Implementation of a flat rate pay system will better align the
pay practice for compensating NAF automotive mechanics with current
prevailing pay practices in the private sector.
DATES: We must receive comments on or before August 13, 2012.
ADDRESSES: Send or deliver comments to Jerome D. Mikowicz, Deputy
Associate Director for Pay and Leave, Employee Services, U.S. Office of
Personnel Management, Room 7H31, 1900 E Street NW., Washington, DC
20415-8200; email pay-leave-policy@opm.gov; or FAX: (202) 606-4264.
FOR FURTHER INFORMATION CONTACT: Madeline Gonzalez, (202) 606-2838;
email pay-leave-policy@opm.gov; or Fax: (202) 606-4264.
SUPPLEMENTARY INFORMATION: The U.S. Office of Personnel Management
(OPM) is issuing a proposed rule to establish special wage schedules
for the Department of Defense's (DOD's) approximately 80
nonappropriated fund (NAF) automotive mechanics. These special wage
schedules would replace the current commission pay practice covering
DOD's NAF automotive mechanics with a flat rate pay system.
Implementation of a flat rate pay system will better align the pay
practice for compensating NAF automotive mechanics with current
prevailing pay practices in the private sector.
Background
Since 1972, OPM (and its predecessor, the Civil Service Commission)
has been responsible for overseeing the administration of the Federal
Wage System (FWS), the pay system for the Federal Government's craft,
trade, and laboring employees. The FWS is designed to provide common
policies, practices, and job-grading standards for uniform application
by all Federal agencies. While most FWS employees are paid according to
their grade level from the regular wage schedule for their wage area,
certain agency policies and practices, including the NAF pay practice
for compensating automotive mechanics on a commission rate basis,
continued as ``set-aside'' pay practices under the FWS. The set-aside
pay practices were to be frozen in place until they could be reviewed
by the Federal Prevailing Rate Advisory Committee (FPRAC), the national
labor-management committee responsible for advising OPM on matters
concerning the pay of FWS employees. These NAF set-aside pay practices
are documented in appendix V of the OPM Operating Manual Federal Wage
System--Nonappropriated Fund. Appendix V provides the schedules,
employee coverage, basis for rates, evaluation plan, and schedule areas
applicable under the NAF set-aside schedules.
DOD has requested that the current commission pay practices
covering DOD's NAF automotive mechanics be replaced with a flat rate
pay system. FPRAC reviewed and recommended that we adopt these changes
by majority vote. These changes would be effective on the first day of
the first applicable pay period beginning on or after 30 days following
publication of the final regulations.
Current Commission Pay Plan
The commission rate special schedules compensate automotive
mechanics on the basis of a percentage of sales. Under the current
commission pay plan, management controls the shop labor rate and
determines the commission percentage. The automotive mechanic's pay is
directly linked to sales generated. Any fluctuation up or down in the
shop labor rate impacts the automotive mechanic's earnings.
Proposed Flat Rate Pay Plan
The proposed flat rate pay plan would not be linked to shop labor
rates, but would instead take into account local prevailing rates, the
mechanic's skill level, and the standard number of hours required to
complete a particular job. Since the change would de-link shop labor
rates from employee pay rates, it would permit NAF automotive
businesses to adjust retail rates as needed without having to adjust
employee pay rates.
Under the flat rate pay plan, DOD would conduct a special flat rate
survey of similar jobs in the local area annually. An hourly flat rate
would be established for each of the covered grades. The flat rate
would be de-linked from the sale. Fluctuations up or down in the shop
labor rate would not impact the automotive mechanic's earnings.
Employees Covered
NAF automotive mechanics who would be changed to a flat rate pay
system are employees in pay plans NA, NL, and NS, series 5823, grades 8
through 10, who are currently paid based on commission. Employees
currently being paid hourly rates would not be moved to the flat rate
pay system; they will continue to receive hourly rates. No current
employee will have his or her pay rate reduced as a result of
implementing these new special schedules.
Effect on Employee Benefits
The flat rate pay plan would not change how premium pay, paid
leave, and holidays are paid nor would it change the employee's
retirement calculation.
FPRAC Oversight
The automotive mechanics flat rate pay plan would be re-evaluated
by FPRAC every 3 years, beginning 3 years after OPM issues final
regulations to implement the special wage schedules for NAF automotive
mechanics. In preparation for this evaluation, OPM staff would prepare
a report on the impact of the plan on recruitment, retention, and
workers' earnings.
[[Page 34855]]
Regulatory Flexibility Act
I certify that these regulations would not have a significant
economic impact on a substantial number of small entities because they
would affect only Federal agencies and employees.
Executive Order 13563 and Executive Order 12866
This proposed rule has been reviewed by the Office of Management
and Budget in accordance with Executive Order 13563 and Executive Order
12866.
List of Subjects in 5 CFR Part 532
Administrative practice and procedure, Freedom of information,
Government employees, Reporting and recordkeeping requirements, Wages.
U.S. Office of Personnel Management.
John Berry,
Director.
Accordingly, the U.S. Office of Personnel Management is proposing
to amend 5 CFR part 532 as follows:
PART 532--PREVAILING RATE SYSTEMS
1. The authority citation for part 532 continues to read as
follows:
Authority: 5 U.S.C. 5343, 5346; 532.707 also issued under 5
U.S.C. 552.
2. Subpart B is amended by adding Sec. 532.287 to read as follows:
Sec. 532.287 Special wage schedules for nonappropriated fund
automotive mechanics.
(a) The Department of Defense (DOD) will establish a flat rate pay
system for nonappropriated fund (NAF) automotive mechanics. This flat
rate pay system will take into account local prevailing rates, the
mechanic's skill level, and the standard number of hours required to
complete a particular job.
(b) DOD will issue special wage schedules for NAF automotive
mechanics who are covered by the flat rate pay system. These special
schedules will provide rates of pay for nonsupervisory, leader, and
supervisory employees. These special schedule positions will be
identified by pay plan codes XW (nonsupervisory), XY (leader), and XZ
(supervisory), grades 8-10, and will use the Federal Wage System
occupational code 5823.
(c) DOD will issue special wage schedules for NAF automotive
mechanics based on annual special flat rate surveys of similar jobs
conducted in each special schedule wage area.
(1) The survey area for these special surveys will include the same
counties as the regular NAF survey area.
(2) The survey jobs used will be Automotive Worker and Automotive
Mechanic.
(3) The special surveys will include data on automotive mechanics
that are paid under private industry flat rate pay plans as well as
those paid by commission.
(3) In addition to all standard North American Industry
Classification System (NAICS) codes currently used on the regular
surveys, the industries surveyed will include--
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2007 NAICS codes 2007 NAICS industry titles
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441110............................ New Car Dealers.
441310............................ Automotive Parts and Accessory
Stores.
811111............................ General Automotive Repair.
811191............................ Automotive Oil Change and
Lubrication Shops.
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(4) The surveys will cover establishments with a total employment
of eight or more.
(5) The special schedules for NAF automotive mechanics will be
effective on the same dates as the regular wage schedules in the NAF
FWS wage area.
(d) New employees will be hired at step 1 of the position under the
flat rate pay system. Current employees will be moved to these special
wage schedules on a step-by-step basis. Pay retention will apply to any
employee whose rate of basic pay would otherwise be reduced as a result
of placement in these new special schedules.
[FR Doc. 2012-14274 Filed 6-11-12; 8:45 am]
BILLING CODE 6325-39-P