ABSTRACT
Merit pay has had a long history in the U.S. civil service. Graduated pay systems were introduced in the federal civil service shortly after passage of the Pendleton Act (Van Riper 1958). Step-in-grade systems enjoyed widespread popularity among all levels of government until the 1970s when they came under increasing attack (see, e.g., Patton 1974; Savas and Ginsburg 1973). They were criticized for being automatic and for failing to differentiate employee rewards based upon performance. These shortcomings led to a search for alternatives that resulted in the merit pay provisions of the federal Civil Service Reform Act of 1978 (CSRA) (Hunter and Silverman 1980; Perry et al. 1982) and similar reforms in a variety of states and localities (Griener et al. 1981).
