Foreign Relations of the United States, 1977–1980, Volume XXVIII, Organization and Management of Foreign Policy

154. Memorandum of Conversation¹

Washington, June 9, 1978, 4 p.m.

PARTICIPANTS

• Mr. Sugarman
• Mr. Messner
• Mr. Read
• Mr. Galloway
• Mr. Gershenson

SUBJECT

• Civil Service Reform

Mr. Sugarman began by saying this was the first of a series of meetings he would hold with various government agencies to discuss the implications of the FPMP. The Senate markup of the bill is almost complete and no significant modifications have been made in the proposed bill. In the House, the Democratic caucus initially modified the bill to add unacceptable labor/management proposals to it. The feeling is, however, that once the bill reaches the floor, it will be passed without the major changes. The only major issue they have little hope for is the modification of veterans’ preference.

Based on this optimistic appraisal, Mr. Sugarman gave Mr. Read a letter, pointing out a number of areas in which agencies should begin to work immediately in order to permit them to make the implementation timetable in the legislation. In principle, and with the exception of merit pay, the entire system is expected to be operable 9 months after the President signs the bill (expected to be in October of this year).

In the wide-ranging discussions that followed, a number of specific issues were raised:

—Mr. Messner asked our views on the percentage of senior executives in the government we expect might opt to enter the Executive Corps. Mr. Sugarman said he would anticipate some 80% would join. Mr. Messner said he had signals that it would be a much lower percentage. Mr. Messner mentioned the high priority given to Civil Service Reform by the Administration and its high visibility in terms of future political campaigns. It was thus important that everything possible be done to encourage a high percentage of Executive Corps acceptance.

In this connection, the group discussed the Foreign Service’s earlier experience with conversion programs, particularly the Wriston program² and lateral entry under Diplomacy for the 70’s.³ Mr. Read asked Personnel to pull together a brief review of our conversion programs in terms of the inducements given, the impediments to each effort, and the results.

The following timetable for transfer to the Executive Service was anticipated: approximately 90 days after passage of the legislation, agencies would be required to identify the positions that would become a part of the Executive Service. Sometime within a month or so thereafter, offers would be made to the incumbents of those positions to join the Executive Service. Mr. Messner made clear that the President was determined to have people encouraged to join, not compelled to do so.

Then there was a discussion of a number of specific points in Mr. Sugarman’s letter, attached:⁴

—On establishing performance standards for all employees, a deadline of next March 31 would be set for agencies to have their systems in place. Mr. Read indicated we are probably in a better position than most in this area.

—In terms of a system to establish critical job elements in order to determine if performance was unsatisfactory (Item 7), Mr. Sugarman pointed out this task would take 3 to 5 years and would be related to job descriptions.

—Mr. Sugarman indicated that agencies would have approximately 6 months in which to seek from the new central personnel management authority to take over certain CSC personnel management programs.

—Mr. Sugarman indicated that it would be at least one year before they would be able to develop the merit pay system.

A number of points mentioned in the letter will take effect immediately upon passage of the bill; i.e., a new arbitration system will be in place, but agencies will have to develop their own procedures to use it. Similarly, agency adverse action systems will have to be modified to conform with the new system.

Mr. Read asked if we might not briefly discuss the possibility of an interrelationship between the Foreign Service system and the new FPMP. Specifically, could we phase change in our system in such a way as to bring it into agreement with the FPMP and still remain an excepted service?

Mr. Messner indicated he did not understand the reason for doing something like this. He felt the Department would have a hard time getting legislation to align itself with an already established system (FPMP). He said it would be very difficult for the Department to get OMB support for its own legislation as it did not have a very solid justification for not participating in the general system.

There was a discussion of the possibility that some, but not all, of the Foreign Service system might become part of the FPMP. The problem was that while all Foreign Service officers now in executive level jobs would remain in them, new people for these jobs could only be selected after certification by the central personnel management authority. A qualified list of candidates from throughout government would be provided and the agency could make the final selection.

There was also a discussion of classification questions and how the classification of the Department’s positions could be managed. In response to a question on the control of the number of executive positions, Mr. Sugarman indicated that the initial number would be entirely in the hands of the agency itself. Subsequent changes in that number would be managed by the Office of Personnel Management.

A number of other points were made on the pros and cons of FPMP for the State Department. There was a clear consensus that a great deal of work would have to be done before we could intelligently evaluate the situation. Mr. Read indicated that we would form a small, high-level task force to look into the pros and cons of the entire issue and develop our position. He indicated we would have a group in place and operating by early July.

1. Source: National Archives, RG 59, Records of the Under Secretary for Management (M), 1978–1979, Box 1, Chron June 7–9, 1978. No classification marking. Drafted by Gershenson. The meeting took place in Read’s office.
2. The Wriston program, 1954–1958, brought several hundred officers into the Foreign Service through lateral entry. See also footnote 4, Document 206.
3. Reference to U.S. Department of State, Diplomacy for the 70’s: A Program of Management Reform for the Department of State (Washington: U.S. Government Printing Office, 1970). See also Foreign Relations, 1969–1976, vol. II, Organization and Management of U.S. Foreign Policy, 1969–1972, Document 312.
4. Not found attached.