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SEC, Union Remain at Odds Over Raise

July 10, 2002

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WASHINGTON (AP) _ Securities and Exchange Commission employees will get a long-awaited raise next month, but a salary controversy may be decided by a federal panel with scant experience in performance-based pay.

Pay has been a sore point at the SEC, and President Bush announced plans Tuesday to provide another $100 million to expand SEC hiring and raise pay. Bush provided $25 million earlier this year, shy of the $76 million needed to bring SEC pay in line with bank regulators.

SEC chairman Harvey Pitt’s offer of a 6 percent raise was attacked by the National Treasury Employees Union, which represents 1,800 SEC employees. The union wants a 12 percent raise and one-time 5 percent bonus for members, which SEC managers say would cost $19 million, leaving little for the SEC’s 1,200 non-union employees.

Extra pay for high-cost areas such as San Francisco and New York is another sticking point, with the union proposing heftier increases than management.

Management and the union also clashed on Pitt’s proposal to create a new, 31-step merit pay system to reward high achievers. The union wants a 19-step plan similar to one at the Federal Deposit Insurance Corp., and a process to appeal managers’ decisions on merit-based raises.

Employees haven’t seen a penny yet, due to delays as payroll computers are retooled. Pitt told them to expect back raises on Aug. 16, and higher pay thereafter. He dropped earlier threats to raise pay for managers only, saying the SEC needed to provide raises for all employees to fulfill its mission.

Although the union can’t stop Pitt from raising pay for managers, it can challenge him if he does the same for union members, and has warned him a unilateral change in pay for bargaining unit employees would constitute an unfair labor practice.

NTEU president Colleen Kelley said the dispute is unfortunate since both sides favor higher pay. The NTEU petitioned the Federal Service Impasses Panel in May, saying talks stalled due to the SEC’s ``take-it-or-leave-it″ attitude.

The SEC rejects suggestions of an impasse, telling the panel the two sides haven’t spent enough time bargaining and should resume, with a mediator, if needed. The union wants binding mediation-arbitration, allowing each side to submit a last, best offer to an independent third party.

Both sides requested a quick decision by the seven-member Republican panel. All are new to the job this year and have little experience in merit pay, since federal salaries generally aren’t negotiable.

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