Long-service awards; recognition of merit; performance appraisal
Introductory note. This section covers the following issues: (i) long-service awards or steps; (ii) merit increments and other forms of merit recognition and (iii) performance appraisal.
(1) The Salary Review Committee had proposed that two "longevity steps" should be added to the P.3 scale, subject to certain conditions. At the special CCAQ session of March 1957 (CO-ORDINATION/R.244, para. 56) the organizations thought that such steps should be added at all grades in the Professional category, but the General Assembly rejected ACC advice to this effect and adopted the Salary Review Committee recommendation. At its 19th session (1958: CO-ORDINATION/R.264, para. 10) CCAQ took note of the fact that UN and ICAO would apply the SRC formula; WHO, UNESCO and FAO were taking no steps towards its implementation, and ILO reserved its position.
(2) At meetings held concurrently with the 18th session of ICSAB in l970, CCAQ decided that the matter of long-service awards, and its relationship to meritorious service awards, should be examined at the 33rd session of CCAQ (l97l), and that the secretariat should solicit the views of organizations in the interim. The question of whether longevity steps for General Service staff should be introduced in any locality was to be determined on the basis of what was best prevailing practice in the locality (see CCAQ/SEC/114(PER), paras. 11-13).
(3) The results of the Secretariat inquiry foreseen in para. (1) above (CCAQ/SEC/197(PER)) reflected a wide variety of opinion. Since at that point the Special Committee for the Review of the UN Salary System (see section 2.2, paras.(16), (18), (19) and (20)) had begun its hearings, CCAQ did not pursue the matter of long-service awards and merit increments, believing that the Special Committee would include this item in its examination. In the event, it did not do so.
(4) At its 51st session (August 1979: ACC/1979/R.55, para. 23) CCAQ agreed that any attempt to harmonize staff regulations with regard to long-service or merit increments would best be handled in the context of ICSC's study on career development.
(5) At its 53rd session (July 1980), CCAQ reviewed a paper on performance appraisal prepared by the ICSC secretariat in the context of a comprehensive review of this subject. While endorsing the general approach, the Committee did not believe that all the concerns of the organizations were taken into account (ACC/1980/17, paras. 25-28). In order to prepare its presentation to the Commission's 13th session (March 1981), CCAQ convened in January 1981 a working party whose report was examined at the Committee's 54th session (March 1981: ACC/1981/7, paras. 90-91 and Annex V).
(6) At its 13th session, ICSC recommended a model performance appraisal form for use within the common system (seventh annual report, A/36/30, para. 226 and Annex X), effective 1 January 1982.
(7) At its 55th session (July 1981: ACC/1981/31, paras. 66-69) CCAQ initiated a review of the question of long-service and merit awards. At its 57th session (July 1982: ACC/1982/23, paras. 89-94) CCAQ agreed that the question should be sub-divided into three distinct issues: rewards for long service; compensation for staff blocked at the top of their grades; and merit awards. Long service per se could be rewarded in a number of non-financial ways, and merit awards were a subject requiring more reflection and consideration before any action was envisaged; ICSC, in its 7th (1981) annual report, had encouraged organizations to provide appropriate awards for meritorious service within the current steps and range of the salary scale.
(8) At its 58th session (March 1983: ACC/1983/9, paras. 87-91) CCAQ agreed to concentrate on the problem of staff with long service at the top of their grade. It was agreed that a paper would be presented to ICSC at its 18th session (July 1983) setting out the policy framework the organizations proposed to adopt in this regard, seeking its endorsement. The policy framework should be flexible enough so that each organization's requirements could be met.
(9) At its 59th session, CCAQ adopted for presentation to the ICSC a paper setting out a policy framework for rewards to staff with long service at the top of their grade (July 1983: ACC/1983/18, paras. 58-62, and ICSC/18/R.19). At the same time, it considered proposals formulated by the Geneva-based organizations for the introduction of some form of merit awards. CCAQ agreed to revert to this question at its 60th session.
(10) ICSC, at its 18th session (July 1983: ICSC/18/R.33, paras. 96-103), noting that the CCAQ policy framework involved the granting of additional increments above the maximum of the grade, decided to request its secretariat to elaborate criteria for the selective award of such steps. In the meantime, executive heads were requested not to take any further action in regard to the introduction of new schemes or the extension of existing ones.
(11) At its 60th session (March 1984: ACC/1984/9) CCAQ decided to concentrate its efforts on measures to alleviate the situation of staff blocked at the top of their grade. At its 19th session (March 1984: ICSC/19/R.22) ICSC, having considered further information on the matter, provided inter alia by CCAQ, decided to recommend that a single additional step above the maximum of the grade be granted to staff, up to grade P-5, whose service was entirely satisfactory, and who had had (a) 20 years of service in the common system organizations and (b) five years of service at the top of their grade and (c) that the amounts should be non-pensionable.
(12) This decision fell far short of what had been advocated by CCAQ, and in particular the non-pensionability caused concern. CCAQ agreed therefore at its 61st session (June-July 1984: ACC/1984/16) to raise the issue again with ICSC. This was done at the ICSC's 20th session (July 1984), and on the basis of CCAQ's representations, ICSC reversed its decision on pensionability (10th annual report, A/39/30 para. 197).
(13) The recommendation of the Commission to introduce one long-service step was, as far as General Service staff was concerned, addressed to the Executive Heads. At its 63rd session (July 1985: ACC/1985/14, para. 90) CCAQ was informed that the recommendation had been accepted, with effect from 1 January 1985, by the United Nations and by all organizations.
(14) In respect of staff in the Professional and higher categories, ICSC's recommendation was addressed to the governing bodies. The General Assembly did not, however, act upon this recommendation; it requested the Commission, in resolution 39/69, to review the matter, with a view to achieving uniformity on this matter within the common system. Responding to the General Assembly's request, the Commission advised the Assembly that it maintained its recommendation (A/40/30, para. 174). It informed the Assembly that the position of ILO and WHO was that their current practices concerning long-service steps (which involved more than one step, granted under different conditions) should be maintained. At the same time, the Commission decided to request the executive heads of ILO, WHO and UPU to consider ways of harmonizing their practices with those of other organizations of the common system, along the lines recommended by the Commission, and to place this matter before their governing bodies. The General Assembly did not take specific action on the issue, but expressed its concern over actions taken by some of the participating organizations which had led to disparities in the UN common system (resolution 40/244, IV, para. 4).
(15) At its 24th session (July 1986), the Commission reviewed a progress report by its secretariat on the subject of performance appraisal and merit recognition, based, inter alia, on the findings of a tripartite working group which had met in April 1986. The Commission decided to review selected aspects of this subject at its 26th (summer 1987) and 28th (summer 1988) sessions (12th annual report: A/41/30, para. 217). CCAQ's views on this matter are recorded in the report of its 65th session (ACC/1986/10, paras. 115-117).
(16) At its 65th session (ibid., para. 138), CCAQ decided that the long-service step for General Service staff should be taken into account in determining the salary mid-point for the children's allowance (see section 2.7, para. (27)).
(17) At its 67th session (July 1987: ACC/1987/10, paras. 122-125) CCAQ discussed a set of performance appraisal principles proposed by ICSC. Although in general agreement with the approach reflected in the principles, the Committee could not accept all the detailed guidelines developed on the basis of the latter. It felt that final and detailed implementation aspects should be left to organizations. CCAQ agreed that the determination of tasks and the evaluation of performance were a responsibility of management and as such were not negotiable with the staff. The discussion in ICSC, and the Commission's recommendations, are contained in paragraphs 297-305 and annex XV of the Commission's twelfth annual report (A/42/30). The General Assembly took note of the principles and guidelines for performance appraisal and recognition of merit which it had recommended (resolution 42/221, section V, para. 3).
(18) In the terms of reference of the study which it commissioned in the early stages of the comprehensive review of conditions of service of staff in the Professional and higher categories (General Assembly resolution 42/221) CCAQ called attention to the need for the remuneration package to promote productivity through the recognition of merit (68th session, February-March 1988: ACC/1988/4, annex III). The study duly recommended explicit provision for "merit pay" (ACC/1988/12, annex IV, para. 62).
(19) Elaborating on its request of the previous year, the General Assembly (resolution 43/226) stated that in the comprehensive review consideration should be given to enhancing productivity through merit incentives and rewards on promotion linked to a more rigorous performance appraisal system.
(20) The tripartite working group on the comprehensive review, set up by ICSC in 1989, recommended that motivation and productivity be enhanced by adjusting relativities within the salary scale (reducing the percentage value of step increments and reducing the overlap between grades), increasing the financial benefit to staff members on promotion, providing non-monetary merit awards and environmental motivators, and introducing lump-sum merit awards. Although CCAQ had reservations about the latter proposal, it generally agreed with the others (71st session, July-August 1989: ACC/1989/14, paras. 74-81).
(21) In its recommendations to the Assembly on the basis of the comprehensive review ICSC similarly declined to make new proposals for lump-sum awards for merit (A/44/30, vol. II, para. 353), but its recommendations on structural improvements to the salary scale and on promotion, later endorsed by the Assembly (resolution 44/198), were along the lines suggested by the working group and supported by CCAQ (A/44/30, vol. II, paras. 356, 357 (a)). The Commission reiterated its 1987 recommendation on cash awards (see para. (17) above), urged that groups as well as individuals be eligible for such awards, and recommended the introduction of non-monetary awards and environmental motivators. Finally, it resolved to monitor the granting of cash awards on the basis of information provided by the organizations (ibid., paras. 357 (b)-(e), para. 358; for General Assembly action in both 1989 and 1990, see resolutions 44/198, section I F and 45/241, section VI).
(22) In its report for 1990 ICSC recommended that for staff in the ILO and WHO merit be rewarded by one-time non-pensionable cash awards rather than through extension of salary scales (A/45/30, paras. 143-162; see also sections 2.3 and 2.15).
(23) CCAQ returned to the question of productivity or merit pay at its 75th session (July-August 1991) in the context of a range of issues relevant to the structure of the Professional salary scale. It observed that the reflection in pay levels of different levels of performance was becoming an "urgent need" in the UN system, and it agreed to review approaches that might be applied in the organizations, drawing as necessary on arrangements introduced elsewhere (ACC/1991/17, para. 51).
(24) In 1991, the General Assembly (resolution 46/191) again called on ICSC to develop proposals on enhancing productivity through the recognition of merit.
(25) At its 78th session (March 1993: ACC/1993/6, paras. 104-108) the Committee welcomed the results of an ICSC secretariat study on the appraisal and recognition of performance and supported a proposal to develop a prototype for adaptation by the organizations. ICSC requested its secretariat to continue its work programme in this area (ICSC/37/R.18, para. 198).
(26) At its 79th session (July 1993: ACC/1993/22, paras. 85-91) the Committee considered proposals by the ICSC secretariat designed to enhance performance management in the United Nations system. CCAQ recognized that rigorous performance appraisal systems must form a core element in its overall strategy for enhancing productivity, effectiveness and accountability and confirmed the principles for performance appraisal and management (ibid., annex III). CCAQ concurred with the emphasis on the importance of developing a performance-related management environment and agreed that there should be some limits on the proportion of staff with ratings at levels above full performance. The Committee appreciated the proposed framework for reward and recognition programmes, together with a timetable for their introduction. It also endorsed modules for training in performance appraisal and management, which developed with CCAQ's Sub-Committee on Staff Training.
(27) At its 80th session (February 1994: ACC/1994/4, paras. 37-43) CCAQ considered performance review in the context of its discussions on a strategy to improve effectiveness and accountability and against the backdrop of a symposium on Performance Management which took place immediately prior to the session. The Committee considered that the creation of management competencies, which codified the knowledge, skills and abilities required for effective performance, would help provide a more objective and sound basis for measuring managerial performance. The Committee agreed on four principles - in addition to those being adopted by ICSC - which were pertinent to the evaluation of performance of managers in all organizations of the common system (ibid. para. 38) and four levels of performance which could be assessed through performance review, as well as an expected distribution of the ratings for the group (ibid. paras. 39-41). The Committee felt that the determination of who the evaluator would be was pivotal to the success of introducing greater rigour and avoiding "political" or other inconsistencies and that organizations would have to consider how best to ensure the necessary objectivity and transparency (for the different means suggested, see ibid. para. 43).
(28) At its 81st session (June 1994: ACC/1994/14, paras. 58-69) CCAQ recognized the need to introduce more objectivity and rigour in the performance appraisal process for all categories of staff in order to improve organizational performance. Performance should be appraised against pre-determined result-oriented job goals or objectives and the competencies required to achieve them. Some core behavioural competencies, such as those in the code of conduct, applied to all staff, other core competencies would vary by occupation and category. Managerial competencies applied to all managers, not just the Director category. CCAQ supported the developmental work on management competencies, which would lay the groundwork for improving managerial skills at all levels. The Committee concluded that the performance appraisal process should be the basis for any type of recognition scheme, whether in the form of cash or non-cash awards, geared to suit the culture, size and structure of each organization. In addition to tangible awards, the Committee underlined the importance of other ways to recognize performance, such as praise for a job well done, increased responsibility, etc. Greater recourse also had to be made of sanctions for unsatisfactory performance. CCAQ also decided to develop a prototype performance appraisal system and guidelines for the introduction of the system, which would provide the mechanism for introduction of a performance management culture. The Committee focused especially on the size of potential cash awards. The Committee foresaw the amount being the equivalent of half a month's pay for performance above the full performance level and the equivalent of a month's pay for outstanding performance but such awards should be paid in the form of non-pensionable lump-sum bonuses and their numbers limited in percentage terms. The Committee also acknowledged the importance of a full array of non-cash awards and other less tangible elements of recognition which were equally if not more important for some organizations (ibid., paras. 152-157). ICSC decided, inter alia, to approve the proposed training modules, the revised guidelines for performance appraisal and management and the recognition of levels of performance and measures for dealing with unsatisfactory performance and recommended them to organizations. ICSC also recommended parameters for introduction of merit pay (A/49/30, paras. 347-348).
(29) At its 82nd session (April 1995: ACC/1995/5, paras. 124-129) in discussing performance management issues, CCAQ reaffirmed that managerial and organizational performance had to be upgraded and institutional cultures had to be created which valued effective performance, efficiency and accountability but acknowledged that performance appraisal was only one element of the inter-related components which made up human resources management. To be successful, appraisal had to be introduced within the framework of a positive performance management environment in which staff could see the benefits of improved performance. Organizations should invest in developing programmes to provide managers with the skills for managing people. ICSC noted the actions taken by ILO and WHO with regard to long-service and merit increases to bring their practices into line with those of other organizations and reiterated its recommendations that organizations granting merit increases should discontinue them in favour of lump-sum bonuses (ICSC/41/R.19, para. 371).
(30) Also at its 82nd session, CCAQ considered the work that had been done in its Sub-Committees on Job Classification and Training on defining the elements of a core management competency framework, against which managers would be selected, appraised and training would be developed. The Committee reaffirmed the view that management competencies should be introduced into the common system as part of an integrated human resource strategy to improve overall organizational performance. The Committee also listed ten elements which should be considered for incorporation in appraisal system redesign and requested its secretariat to revise the draft guidelines and complete work on an appraisal form (ibid., paras. 130-136).
(31) At its 86th session (April 1997: ACC/1997/6, paras. 43-52) CCAQ, in response to an initiative of the General Assembly, reviewed the possibility of introducing performance awards or bonuses which could be tailored to the needs and priorities of each organization, maintaining common system parameters and hence ensure inter-agency coherence whilst allowing for flexibility. The Committee, recognizing that the starting point for the designation of any performance award had to be an effective system for differentiating levels of performance, concluded that as a first step each organization had to ensure that its performance appraisal and other systems were generally perceived to be objective, fair and viable management tools. CCAQ reiterated its endorsement of the ICSC principles relating to performance management but considered that the framework and guidelines for recognition and award programmes were unduly prescriptive and restrictive. CCAQ recognized that certain guarantees must be the corollary to granting greater flexibility to organizations so that they might tailor their systems to their individual needs and proposed a number of parameters for the development of performance awards. ICSC concluded that its exchange of views should give its secretariat sufficient guidance to develop a framework for performance management schemes in the common system, including the treatment of under-performance (ICSC/45/R.13, para. 193).
(32) At its 87th session (July 1997: ACC/1997/13, paras. 44-47 & annex IV) CCAQ expressed appreciation for the non-prescriptive guidance provided by the ICSC secretariat on parameters for the development of performance awards, which would be particularly useful in the development of approaches tailored to their individual cultures and the different stages of development of their performance management systems. The Committee underlined the potential for using non-monetary awards in the development of recognition and reward systems and concluded that ICSC should exercise caution in avoiding any finite determination which might in the long run jeopardize the introduction of performance management systems, such as by determining prematurely whether cash awards for the Professional category should be based on net base salary or on net remuneration (i.e. including post adjustment) or by recommending the introduction of quota systems. Each organization's governing body would exercise its responsibility for ensuring rigour when reviewing proposals and approving funding for such programmes. ICSC, noting that differing organizational strategies and cultures called for a flexible approach to performance management, decided to replace the recommendations on cash awards contained in its 1994 annual report. Any pay-based approach to performance management should be introduced on a pilot basis and developed in close consultation with the ICSC secretariat. It added to its earlier recommendations on the management of underperformance and requested its secretariat to complete and circulate as soon as possible a portfolio of best practice in the area of performance management (A/52/30, paras. 213 & 219). The General Assembly by its resolution 52/216 III B welcomed the information provided by ICSC and invited the executive heads of the organizations of the common system to develop their performance management programmes within the parameters set by the Commission.
(33) At its 91st session (July 1999: ACC/1999/13, para. ) CCAQ received an updated report on status of implementation of ICSC's recommendations on performance awards and noted that there were a large number of developments in the current status and thinking on the introduction of performance-related awards and that the picture across organizations was more dynamic than might be reflected in the document which would be submitted to ICSC. It encouraged organizations to present this fuller picture to ICSC at its current session and, in particular, to underline the concerns which had been expressed within organizations and indeed in governing bodies for the introduction of performance-related awards. These included the overriding need to ensure that, before rewards were introduced, the performance appraisal systems on which they were based would have to be more robust and transparent than in a number of instances was currently the case. ICSC took note of the oral presentations and an informal document provided and decided to keep the matter on its agenda, noting that it would receive a report on implementation of its decisions and recommendations in 2000 (ICSC/50/R.5, para. 31).
(34) At its July 2002 meeting (CEB/2002/HLCM/14, para. 3) the HR Network considered performance management systems in the context of a system of reward for contribution. The discussion and decision of the ICSC is recorded in section 2.16, para. (18).
(35) At its March 2003 meeting (CEB/2003/HLCM/12, para. 4) the HR Network again considered performance management systems in the same context. The Network's discussion and decision of the ICSC are recorded in section 2.16, paras. (26)-(32).
(36) At its July 2003 meeting (CEB/2003/HLCM/20, para. 3) the HR Network once again considered performance management systems in the same context. The Network's discussion and decision of the ICSC are recorded in section 2.16, paras. (34)-(37).
(37) At its March 2004 meeting (CEB/2004/HLCM/14, para. 12) the HR Network agreed that the concept of strategic bonuses was of interest but that it would require significantly more discussion. It decided to ask ICSC to defer consideration of the item until after the completion of the pilot study on broadbanding, particularly as many of the issues being examined in the pilot were intrinsically linked. The Network reiterated the importance it placed on the issues of recruitment, retention and relocation whilst recognizing that there was a need to manage the social, and not just financial, elements of these areas, such as motivation, job satisfaction and work/family issues, which were increasingly important for all global employers. Empirical research had established that dual careers and access to work permits for spouses were major impediments to hiring and relocating a high quality expatriate workforce. This research had also shown this to be a global problem and not restricted to people coming from any one continent. It expressed concern that, in the absence of an updating of the Noblemaire Principle, introduction of such bonuses could open the door to nationality based pay and noted that, while a few organizations remained interested, no organization would be willing at this time to pilot such bonuses. ICSC decided to defer its consideration of this issue and requested that its secretariat prepare a document for its 59th July 2004 session that would look at strategic bonuses in tandem with the mobility and hardship scheme(ICSC/58/R.12, para. 105).
(38) At its July 2004 meeting (CEB/2004/HLCM/25, para. 4) the HR Network again considered performance management systems. Its discussion and the decision of ICSC are recorded in section 2.16, paras. (43)-(44).
(39) At the sixteenth session in New York (CEB/2008/HLCM/HR/35, paras. 63-64), the HR Network:
* Thanked UNFPA for the interesting and comprehensive presentation and expressed its general support for this innovative and effective performance appraisal system;
* Recalled the OIOS recommendation from 2005, which calls for coordination and collaboration in performance appraisals and incentives. The Spokesperson requested that organizations report on their performance appraisal systems in order to develop guidelines for a common framework taking into account best practices.
(40) At its twenty second session (CEB/2011/HLCM/HR/19, paras. 31-33), the HR Network thanked the ICSC Secretariat for their work and noted that the framework on performance management to guide organizations. It requested clarification in the areas of non-financial and team rewards as well as the issue of dealing with rebuttals and demoting non-performing staff members. It agreed that some areas needed more details, especially on their legality.
The Commission decided:
(a) To submit the revised framework to the General Assembly for its approval;
(b) To consider the use of merit steps at a future session.
(41) At its twenty third session in September 2011 (CEB/2011/HLCM/HR/23, paras. 16-17), the HR Network agreed that the harmonization of key elements of performance appraisal systems, which was led by WHO, needed more work before submission to HLCM. A Working Group, comprised of UNWRA, UNOPS, FAO and WHO, would look at the different performance appraisal systems and identify common elements. Their work should be completed by February 2012.