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Merit system morphs into monster

By Joel Peyton

A commission created by former Gov. Brereton Jones in the early 1990s recognized what current Frankfort politicians know but refuse to seriously address: Kentucky’s merit system simply doesn’t work.

Originally, this system sought to make qualifications – not political-party affiliation – the determining factor in hiring and promotion decisions involving state workers. A system designed to serve taxpayers well has morphed into one in which longevity and an aversion to risk are the primary requirements to sustain annual pay raises.

Ironically, the central theme of the merit system – to eliminate political hiring and firing – never matured. Over the years, a continuing degradation of the original system’s principles has created a merit-system “monster” – an entangled thicket of rules and regulations that have created an unrecognizable facsimile of its creators’ original intent.

The current state-employee system denies advantage to good workers and insulates unproductive ones. Exceptional workers have little chance of getting a better raise than their lazy cohorts. Plus, no real consequences follow a poor performance … and too many state workers know it.

What incentives motivate front-desk clerks at Kentucky State Parks to provide guests with Hilton-like quality service? While any job will naturally attract some good workers, Kentucky’s system has difficulty retaining them. If workers know there is no penalty for not providing quality service on a particular day, this irresponsible behavior over time will negate the good intentions of responsible workers.

Protecting state workers from political discrimination – not prohibiting the firing of irresponsible employees – was the goal of policymakers in creating Kentucky’s merit system in 1960.

A remedy recommended by former Gov. Jones’ commission suggested making the evaluation system for measuring employee performance more rigorous and meaningful. Instead, as it now stands, nearly every state worker receives a favorable rating. Jones’ report stated: “‘Merit’ has come to signify a narrow and negative focus on positions and jobs, rather than competence, accountability and effective public service.”

Charles Wells, executive director of the Kentucky Association of State Employees, strongly defends the current system, claiming recently on a radio talk show that the state personnel board upholds nearly 90 percent of all appealed terminations.

But Wells neglects to mention that the current evaluation process forces even the best supervisors to jump through so many hoops to terminate an employee that most just tolerate incompetence and look the other way. It is a lot easier to write “work is satisfactory” on a meaningless evaluation form and maintain the status-quo.

Jones’ commission also recommended simplifying the laws pertaining to employee layoffs. Currently, merit-system employees who get laid off remain on the state’s employment registers for five years. This squashes competition from the private sector because the law guarantees former state workers a job when vacancies occur – whether or not they qualify for the opening.

A recent preliminary report by Gov. Ernie Fletcher's Merit System Blue Ribbon Task Force also recommends eliminating “seniority” as a basis for promotion and instead incorporating performance-based incentives.

Government can always depend on the private sector to supply good ideas that could boost productivity and increase worker motivation.

For example, Kentucky’s legislature approved 10 four-year pilot projects in 1994 that introduced performance-based pay incentives into some government agencies. The results were positive, if predictable.

After the introduction of these incentives at the Department of Social Insurance, employee productivity ballooned from 23rd to seventh in the nation while the accuracy of claims jumped from 33rd to 12th. Part of the process involved re-tooling the agency’s evaluation process to identify areas in which employees could improve – a process essential to the private sector that is virtually unknown to Frankfort today.

Another pilot program at the Kentucky Department for the Blind resulted in savings of more than $62,000 during the same four-year period by grouping classifications for 54 different jobs into three career tracks that allow for career advancement based on education and experience. Instead of embracing each success, Frankfort’s politicians chose not to renew the pilot programs in 1998.

As surely as the moon rises in the east, when an ephemeral sighting of a real merit system rises from its grave, its friendly spirits are driven back underground by fearful insiders who value politics over the care and feeding of those who do the peoples’ work.

A real “merit” system would be good for Frankfort workers, and great for Kentucky.

– Joel Peyton is a research analyst for the Bluegrass Institute, Kentucky’s free-market think tank.

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