State should drop routine longevity pay

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Now that the state’s revenue picture has brightened ever so slightly, Gov. John Baldacci and Democratic legislators are thinking about restoring longevity pay for state workers.

Longevity pay was one of several wage-and-hour cuts imposed on state employees as the full effect of the recession took hold last year.

However, with the Legislature still wrestling with a $350 million budget gap, and with schools and municipalities slashing budgets to make up for cuts in state funding, now is not the time to begin rolling back austerity measures.

The proposed method for restoring this cut is particularly objectionable. The governor and legislative leaders have discussed pushing one state employee payroll into the next fiscal year in order to transfer the cost of this benefit to the next governor and Legislature.

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That’s just wrong, and the governor should shelve that idea.

When the state does get back on stable footing, legislators should seriously question the idea behind the longevity pay benefit.

While there’s something to be said for maintaining a steady work force, there is no productivity advantage in automatically rewarding poor and mediocre employees.

Under Maine’s system, most state workers received a 30-cent-per-hour increase after 15 years; 40 cents after 20 years and 50 cents after 25 years.

These raises were automatic, and they came on top of wage increases reached through collective bargaining.

As anyone who works for a living can tell you, time spent filling a seat does not necessarily mean an individual has improved his or her job knowledge or job performance.

All employees are different. Some learn new skills and become more valuable as time goes on.

Others may show improvement for a short time and then become steady but unremarkable employees.

Then there are always a few people in any group who actually become poorer performers as time goes by, often because they become bored, discouraged or lose interest in their work.

The state’s longevity pay plan treats them all the same: Everyone gets a small but guaranteed raise at regular intervals.

There are several downsides to this plan. First, the small raises might not be enough to retain truly valuable employees. Second, the small raises might be just enough to discourage poor performers from leaving.

To remedy this problem, many employers have developed performance-based compensation systems. These allow them to judge employees on a year-to-year basis, evaluate their performances and adjust their pay accordingly.

These systems are often based upon bonus payments or are tied to meeting specific objectives.

The state does have a merit-pay system, but this was also suspended last year. When the time comes, it would be better to revive that system and dump the outdated longevity pay.

Under a true merit system, supervisors have the latitude to truly reward and retain top employees.

This, of course, runs counter to the traditional public-employee philosophy of annual raises for everyone, regardless of distinctions in performance.

But, when the average state worker earns nearly $53,000 per year, including all benefits, compared to about $44,000 for the average private-sector employee, automatic longevity may be a benefit the state’s taxpayers can no longer afford.

editorialboard@sunjournal.com

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