11/14/07: As you know, on September 4, Arbitrator James Harkless issued a decision on NTEU's national grievance with respect to the 2003 merit pay distributions, ruling that the SEC’s subjective pay for performance program violated Title VII of the Civil Rights Act, as well as the Age Discrimination in Employment Act (ADEA). NTEU and the SEC have now submitted briefs to the arbitrator regarding an appropriate remedy.

NTEU has requested that the arbitrator award full monetary and equitable relief to all affected employees, and also order the SEC to make appropriate modifications to its merit pay system to safeguard against future discrimination and other problems. The SEC, by contrast, has requested individualized reexamination of the merit pay distributions received by each of the hundreds of individual affected employees.

NTEU strongly believes that the SEC's remedy proposal makes little sense. In effect, the SEC is requesting a "do-over" in a context in which the agency appears to be incapable of avoiding the same problems the second time around. Indeed, in a case like this one, in which the agency relied entirely upon subjective criteria and procedures in rendering its merit pay decisions in the first place, it would be entirely inappropriate to return to the same managers and ask them to revisit their subjective decisions when the agency still does not have objective standards in place to guide the managers through that process.

NTEU will press ahead with its position on the remedy. At the same time, the union is also continuing to move ahead with the arbitrations on the 2004, 2005, 2006 and 2007 national merit pay grievances. NTEU remains open to the possibility of a global resolution of the issues that have plagued the the SEC's pay for performance process since its inception. We hope that the SEC will learn from its past mistakes and take the necessary steps to correct fundamental problems in its merit pay system.