GENERAL SERVICE AND RELATED CATEGORIES

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1 Compendium Page 1 GENERAL SERVICE AND RELATED CATEGORIES SECTION METHODOLOGY FOR DETERMINING BEST PREVAILING CONDITIONS rd (February/March) and 4th (July/August) sessions: ICSC continued its review of the salary system and took up the issue of the methodology for determining the best prevailing conditions. ICSC concluded that because it had not yet examined the problems which arose in the application of the principle that the remuneration of the GS category should be established by comparison with best prevailing conditions at each duty station, it was not in a position to express any judgement on the principle itself. It therefore decided to examine the question in detail in 1977 in pursuance of its functions under article 12 of its statute and reserved the possibility to submit later recommendations to the GA about the broad principle. ICSC maintained that the allowances and other entitlements of the GS category (which are part of the remuneration) should continue to be established by comparison with local conditions in each duty station. ICSC would therefore define the methods for application of this principle, in conjunction with those for salaries, under article 11 of its statute, and would consider and determine the rates of GS allowances in particular duty stations when it recommended (or, upon request, determined) GS salary scales under article 12 of its statute in those duty stations [A/31/30, paras. 82 and 83]. In resolution 31/193 B the GA: (a) noted the requests of WHO and ILO to ICSC to assume as soon as possible the functions described in article 12, paragraph 1 of its statute, particularly with respect to the salary scales of the staff in the GS category at Geneva; (b) noted with satisfaction the ICSC decision to advance the assumption of these functions in response to these requests; (c) requested ICSC, as a matter of urgency, to establish, under the authority of article 11(a) of its statute, the methods by which the principles for determining conditions of service in the GS category at Geneva should be applied and, on the basis of such methodology and under the authority of article 12, para. 1, of its statute, to cause a survey of local employment conditions at Geneva to be made to make recommendations as to the salary scales deemed appropriate in the circumstances and to inform the GA at its 32nd session of the actions taken in this regard; (d) further requested ICSC, in its examination of conditions of service of the GS category at Geneva, to examine the basis on which recent substantial salary adjustments of staff in that category were determined and to take them fully into account in its consideration of the salaries of that category of staff and the methodology for future salary adjustments, in so far as they affected GS staff at Geneva; (e) urged ICSC, in carrying out these tasks, to take into account all aspects and especially para. 29 of the JIU report on some aspects

2 Compendium Page of the strike at the UN Office at Geneva from 25 February to 3 March 1976, the joint comments on the report received from ACC and the comments of SG on recommendations Nos. 3 and 4 of the report of JIU and invited its comments; (f) requested the UN/SG to provide to ICSC within the first half of 1977 job descriptions for the GS category at Geneva, grouped according to common job functions, in order to enable ICSC to carry out its survey task th session (February/March): ICSC noted that the number of grades into which the GS category was divided varied from duty station to duty station. It recognized that such variations reflected both differing organizational needs and differing practices in the local labour markets, and concluded that standardization of the number of grades in the scale at all duty stations should not be an absolute requirement. The aim should be to ensure that equal work was equally remunerated, whether or not the number of grades was the same. Within a single duty station (such as Geneva) it was, however, essential that there be a common grading structure and grading standards. ICSC expressed the hope that the organizations at Geneva would take steps to bring their own grading for comparable jobs into line with the grades which had been found appropriate by reference to outside salaries and so achieve the desired uniformity in grading and remuneration. ICSC also noted that the number of steps provided in each grade varied, both from duty station to duty station and from grade to grade. It recalled that steps within a grade did not reflect different levels of responsibility but were intended to provide staff members with a regular increment in remuneration reflecting increasing seniority, independently of such improvement as they might obtain through promotion to a higher grade. Advancement from step to step was normally annual, subject only to certification that the staff member's performance and conduct had been satisfactory. The number of steps per grade was thus determined largely in light of the promotion policies and prospects in different organizations, for different occupations and at different levels, the aim being to ensure that throughout the number of years a staff member could normally be expected to remain in a given grade before receiving a promotion, he or she would receive an annual increment. The number of steps in each grade should therefore not be artificially standardized for the sake of uniformity. However, appropriate overlaps between the spans of successive grades should be maintained [A/32/30, paras. 67 and 68]. ICSC considered the general principle and methodology for establishing the conditions of service of the GS category according to the following plan: (a) the basic principle, i.e., whether GS remuneration should continue to be established in relation to local conditions or by some other criterion; (b) if local conditions continued to be the basis, which local conditions should be used (best prevailing conditions, or some other); (c) the methodology for determining local conditions; (d) the translation of the data obtained concerning local conditions into internal salary scales; (e) the other benefits and allowances of the GS category [A/32/30, para. 72] ICSC also inquired whether the principle of "best prevailing conditions" remained valid

3 Compendium Page 3 and whether the organizations could not obtain the staff they required by offering conditions not necessarily comparable to those of the best employers. In particular, it considered whether the conditions offered by the local public service in each country would not be adequate, in other words, something like a country-by-country application of the Noblemaire principle. It was provided with information on the existing relationship between GS salaries and local public service salaries in certain headquarters countries and noted that (after making allowance for the fact that precise grading equivalencies with each of those services had not been established) there were wide variations between the margins existing for example, in New York, Geneva and Paris. Such variations were likely to be even more marked if the comparisons were made in other, non-headquarters, countries. It concluded that there was no uniform relationship between public service salaries and those of other employers (whether the best or the average) in each country. ICSC further concluded that, while the principle of comparison with local public service salaries might prove satisfactory in some duty stations, it might not be satisfactory in others. To take local public service salaries as the base and to add on to them a margin, the proportion of which would have to vary from place to place, according to the relationship of local public service rates to those offered by other employers in the locality, would avoid none of the disadvantages of comparison with best prevailing conditions and might be open to other objections. ICSC therefore concluded that a comparison based solely on local public service rates was not feasible as a general principle applicable to all duty stations. Pending possible further examination of the principle in the light of the experience it would acquire in various duty stations, ICSC saw no alternative to comparison with best prevailing conditions. In the meantime that principle remained in force until such time as it might be amended by the GA and would therefore be applied for the survey to be carried out at Geneva in 1977 [A/32/30, paras. 77 and 78]. (a) basic principle: ICSC noted that since 1946 the GA had adopted the principle that GS salaries should be established by reference to local conditions, at first in New York and subsequently in each other duty station. It considered the possibility of an international scale, similar to the Noblemaire principle for the P category, or regional scales, but observed that in either case the scale which was adequate for the country with the highest salary levels would be too high for other countries. In order to correct a single standard scale to take into account differences between national levels, it would be necessary to establish a system of adjustments similar to but distinct from the post adjustment index used for P salaries, which would be prohibitively complicated. ICSC therefore concluded that there was no feasible alternative to the determination of salaries of the GS category by reference to local conditions in each duty station [A/35/30, para. 75].

4 Compendium Page (b) which local conditions should be used: ICSC noted that the principle of comparison with "best prevailing" local conditions had been enunciated by the 1949 (Flemming) Committee of Experts and confirmed in its essence by all subsequent review bodies. Its rationale was that the organizations, in order to obtain staff of the standard required, should be able to compete with other employers of staff of equivalent qualifications, i.e. those offering the best prevailing conditions of employment in the locality. ICSC noted also that the earlier formulation "best prevailing rates" had been replaced by "best prevailing conditions", which implied that the comparison should rest not only on the rates of pay but, more broadly, on all the other conditions of employment, such as security of tenure, promotion prospects, retirement and health insurance schemes and fringe benefits [A/32/30, para. 76]. (c) the methodology for determining local conditions: ICSC noted that the 1965 "Guiding Principles" provided for three different methods: (i) for large cities, where there were reliable published data on outside salaries (e.g., New York), those data might be used, supplemented by spot checks of rates paid in key jobs by a small number of reputedly good employers; (ii) for other large cities, where there were no published data (e.g., Geneva, Paris, Rome), surveys should be made, either of the whole labour market, using statistical sampling techniques, or of a fairly large number of outside firms reputed to be among the best employers; (iii) for cities where there were smaller numbers of UN staff (e.g., field duty stations) limited surveys should be made or use made of the results of surveys made by other employers. ICSC concluded that, while the methodology it established should be sufficiently precise to ensure that the best information was obtained, some flexibility for adaptation to local circumstances was desirable [A/35/30, paras. 81 and 83]. ICSC noted that henceforth, whichever of the methods for ascertaining best prevailing local conditions was adopted in a particular case, it was ICSC itself which was responsible for deciding on the method and the details of its application and for analysing the results, drawing conclusions from them and recommending a salary scale in every duty station for which it assumed responsibility under article 12 of its statute. When a survey was to be made to collect data, that survey would necessarily be made under the responsibility of ICSC [A/32/30, paras. 80, 83 and 84]. Three possible ways of collecting data were considered: by ICSC's own secretariat; by a firm of consultants working on behalf of ICSC; or by the organization(s) in the duty station acting on behalf of ICSC under article 27 of the statute. The representatives of the organizations informed ICSC that their preference varied according to the duty station considered. ICSC concluded that whatever method was chosen should satisfy accepted statistical principles of validity to achieve the desired result of indicating conditions which were representative of "best prevailing conditions". Changes in method from one survey to

5 Compendium Page another should be avoided as far as possible, although ICSC, in assuming its responsibilities for surveys, could obviously not be bound by the practices adopted hitherto by other bodies [A/32/30, paras. 86 and 87]. ICSC also considered the question whether local public services should always be included among the employers to be surveyed. ICSC agreed that, provided satisfactory job matches could be found, the conditions of employment of the local public services should in any case be surveyed. If they were found to be among the best, they would automatically be included in the analysis of the result. If they were found to be comparable to those of the good employers surveyed, to include them nevertheless would constitute a change in the principle of best prevailing conditions; ICSC could therefore not include them as long as that principle remained in effect but might reconsider the question when it re-examined the basic principle [A/32/30, paras. 90 and 91]. It was agreed that data should be collected on salaries and on all bonuses or allowances generally paid to all relevant staff of the outside employer, such as "thirteenth month", vacation or end-of-year bonuses, transportation allowances, etc. Until such time as ICSC might possibly be in a position to make a comparison on the basis of "total compensation", all data which might prove useful should be collected; ICSC would decide later which elements should be used for direct comparison, which taken into account in a general, non-mathematical comparison and which disregarded. Significant differences in hours of work should be taken into account; on the other hand, the entitlement to annual leave represented an aspect of the organizations' social policy which was common to both categories of staff and which, not having been taken into account in the comparison or remuneration of the P category with that of the US Civil Service, should not be used for direct comparison for the GS category, although it might be relevant to a general comparison of overall conditions of employment. In general, account should be taken of any benefits or facilities available to staff of the organizations in the same way as of those granted to outside employees. Data should be collected from each employer and for each job on the basis of rates paid to staff actually employed, in addition to maximum and minimum scales where such existed. The age of the employee, length of service with the employer and length of service in the function should also be collected, together with the sex (in order to ascertain whether there was any discrimination in pay rates on the basis of sex). Since the internal rates with which comparison was to be made were the net rates, the outside gross earnings found by the survey should be converted to net by applying average income tax paid by a single person (tax benefits available to taxpayers with dependants being taken into account in determining the level of the internal dependency allowances). However, benefits in cash and kind which were not taxable should be added at net value after the net remuneration had been arrived at (A/32/30, paras. 95 and 96). As regards the internal matching point (step of the relevant grade) with which the external salary, once established, should be compared, ICSC considered various possibilities: the mid-point of the grade, a step

6 Compendium Page determined by comparison of the average ages and/or lengths of service of staff outside and inside in the matching jobs, the average step of staff in the grade in the organizations or a graduated scale from step 1 for entry grades to the top step for senior positions. The methods using age and/or seniority or the average step of staff in the grade were criticized on the ground that they depended too much on the composition of the staff at the moment of the survey and might vary from survey to survey. The consensus of ICSC was that the step to be used as the internal matching point should be determined by the job descriptions used for the match. Thus a job defined as a beginner's job should be matched with beginners outside and equated to step 1 of the grade inside (and such matches would be particularly valuable because they were more easily identifiable); a senior job should be defined in terms of the amount of seniority required and equated to a corresponding step (near or at the top of the grade) inside. Between those extremes the step corresponding to the average step of staff members in the grade might be used. The salary scale could not be constructed solely on the basis of the rates found by outside comparison for the different grades. The scale should have a certain internal balance in the intervals between grades, the span of grades and the points of overlap between them, and those relationships must not fluctuate unduly as a consequence of differing results found outside by each successive survey. The construction of the scale must therefore be a matter of judgement, reflecting trends observed outside in the relativities between pay levels for different jobs, but preserving internal harmony and avoiding the distortions which might be produced by too rigid application of the survey results. The basis for construction of the scale should be the classification structure derived from organizational and management needs as well as from the market situation; consequently, the number of grades and the number of steps in each grade might vary from duty station to duty station [A/32/30, paras. 99 and 100]. Having been obliged by circumstances to assume its responsibility under article 12 of its statute for recommending salary scales for a particular duty station (Geneva) before it had been able to complete consideration in general terms of the principles and methodology involved, ICSC had no choice but to proceed empirically. It decided therefore that it would reach its final conclusions on the general issues involved in the light of the experience it would acquire in conducting surveys in a number of HQ duty stations. It expected that those findings would take the form of a text (or texts) to replace the 1965 "Guiding Principles" [A/32/30, para. 112].

7 Compendium Page th session (August/September): ICSC had before it: (a) the report of its working party and additional information on the preparatory stages of the Geneva survey; (b) a report on the data collected, supplemented by computer print-outs of all the salary data obtained together with details of the sex, age and length of service of the employees concerned (in most cases, individually, but in a few cases by averages for groups of similar employees); (c) analyses of the data from various standpoints and illustrations of the effects of applying different methods of interpretation of the data; (d) the views of the staff associations of six of the organizations, together with separate views presented by the staff association of the seventh organization (WIPO) [A/32/30, para. 142]. ICSC concluded that, while there were considerable variations from employer to employer in the non-cash benefits which they provided to their employees, the general level of other conditions of employment offered by the best employers in Geneva was high. When those conditions were compared with those offered by the organizations of the UN system, although no precise mathematical comparison was possible in most cases, it could be said that UN conditions were better in some respects while those of some outside employers were better in others. Given the method finally adopted by ICSC, it was obliged on this occasion to limit itself to a general judgement that the other conditions of employment existing among the whole group of 22 employers were broadly comparable to those provided by the organizations; in consequence, it decided that it would not be appropriate to single out those conditions which did lend themselves to mathematical comparison, such as hours of work, and to use them to make adjustments to the salary data obtained. ICSC intended, however, to give further study to this question in the light of its experience with subsequent surveys and to deal with it when in due course it established a general methodology for the determination of GS salaries under article 11 of its statute [A/32/30, para. 156]. The second approach would be tantamount to considering that all of the 22 employers belonged to the group of "best" employers, and using the best rates found among them for each job. There was a risk that, at least with one of the two methods envisaged under that approach, the result might be influenced by an exceptionally high rate found for one job in an employer whose rates for other jobs were not among the best. After careful consideration of the relative merits of the different approaches, ICSC concluded that, for the present survey and in light of the data obtained, the second approach would be more appropriate. It emphasized, however, that choice would not prejudge the method to be used for other surveys having regard to the characteristics of each survey; only after ICSC had carried out several surveys would it formulate a general methodology [A/32/30, paras. 168 and 169] In resolution 32/200, the GA noted with appreciation the report on the action taken by

8 Compendium Page 8 ICSC, under article 12, para. 1 of its statute and in compliance with GA resolution 31/193B of 22 December 1976, with respect to the salaries of the staff in the GS category at Geneva The GA, in resolution 35/214 A noted the surveys of best prevailing conditions for the GS and related categories carried out by ICSC under article 12 of its statute, including the second such survey at Geneva, and requested ICSC to continue to study the general principles and methodology for surveys to determine the conditions of service of the GS and other locally recruited categories, including the determination of gross salaries, taking into account the views expressed in the Fifth Committee at the 35th session of the GA th session (February/March): ICSC addressed itself, at the request of FICSA, to matters relating to the conditions of service of the GS staff at field duty stations. In particular, ICSC was requested to take up three specific questions: security of tenure and career structure; methodology for salary surveys; and dependency allowances. Concerning the development of a methodology for salary surveys in the field, ICSC recalled its thorough deliberations and the decisions taken on the subject in the context of its plan for the over-all review of the general methodology for determining the conditions of service of the GS category [A/36/30, paras. 163 and 164]. By resolution 36/233, the GA reaffirmed the importance of the application of common salary scales, as recommended by ICSC under article 12 of its statute, for all GS staff at a particular duty station and requested on, inter alia, general principles and methodology for surveys to determine the conditions of service of the GS and other categories of locally recruited staff members, including staff serving at field duty stations th session (March): ICSC adopted the provisional text of the general methodology for HQ duty stations and agreed to consider any comments on the provisional text received from CCAQ and FICSA but not to reopen the general discussion of the methodology [A/37/30, para. 152]. 16th session (July): ICSC examined document ICSC/16/R.8 on selected issues to be covered by the eventual general methodology for non-hq duty stations. ICSC noted its work on the general methodology had as a broad objective the development of a methodology which would apply the same principles at all HQ duty stations and, with some modification, to all non-hq duty stations while allowing for flexibility in the application of the principles to account for local conditions [A/37/30, para. 147].

9 Compendium Page ICSC approved the general methodology for HQ duty stations in its final form (A/37/30, annex II). A review would be conducted following the second cycle of surveys of HQ duty stations. As regards the study of a general methodology for non-hq duty stations, ICSC agreed with the need to consider all elements relating to the methodology in full and to postpone consideration of a final methodology until its 18th session. It provided some broad guidelines to assist its secretariat in its further studies and requested that a status report be submitted at ICSC's 17th session. In so doing, ICSC authorized its secretariat to participate in an observer status at the field level, in selected surveys, in order to collect data required by ICSC [A/37/30, paras. 152 and 153]. In resolution 37/126, the GA took note of the general methodology for surveys of best prevailing conditions of service of the GS staff and related categories approved by ICSC for application to HQ duty stations th and 20th sessions (March and July): ICSC considered a general methodology for surveys of best prevailing conditions of service at non-hq duty stations, drafted by its secretariat, following tripartite technical discussions among the ICSC secretariat, the administrations and staff representatives [A/39/30, para. 178]. ICSC approved the general methodology for promulgation with effect from 1 January 1985 (ICSC/20/R.28, Add.1). It decided to review the methodology at its 25th or 26th session in the light of experience gained in its application. It was also considered that the HQ methodology for surveys of best prevailing conditions of service should be reviewed at the same time to ensure that there was consistency between the two methodologies [A/39/30, paras. 182 and 183]. By resolution 39/69, the GA noted that ICSC had approved a methodology for surveys of best prevailing conditions of service for locally recruited staff at non-hq duty stations which was to be applied from 1985 onwards and requested ICSC to keep under review the implementation of the methodology for surveys of best prevailing conditions of service for locally recruited staff at non-headquarters duty stations and to re-examine, where necessary, the technical aspects of the methodology in the light of experience th session (July): ICSC had before it document ICSC/26/R.6, which presented relevant issues related to the general methodology for surveys of best prevailing conditions of service at HQ duty stations. ICSC's role in that regard was particularly relevant since the Vienna survey, conducted in March and April 1987, had brought to a close the second round of HQ surveys. Accordingly, it was appropriate for ICSC to review and revise, where necessary, the HQ methodology before the beginning of the third round of surveys, scheduled to begin in the spring of 1988 [ICSC/26/R.25, para. 67]. ICSC decided: (a) to exclude employers from the survey analysis with average salaries that were 10 per cent below those of the next higher employer, but to review each exclusion on a case-by-case basis; (b) to include approximately 20 employers in the

10 Compendium Page survey analysis; (c) to request classification benchmark job descriptions in support of survey jobs proposed by local administration and staff representatives for inclusion in the survey; (d) to delegate to the ICSC Chairman the responsibility for selecting survey jobs and employers. ICSC further decided to request the Chairman to bring to its attention in a timely fashion any points of contention that might arise in the planning phase of the survey; (e) to request its secretariat to develop as part of the methodology a list of data elements which should be requested from survey employers with regard to peripheral survey data, e.g., social security benefits; (f) to continue to retain one-incumbent job matches for those employers with established job classification systems and systematic salary-setting practices; (g) to continue to emphasize the collection of average salary data as opposed to individual salary data; (h) to revise the criteria used to determine whether a benefit should be quantified by eliminating the requirement that the benefit or a close equivalent should be offered by a sizeable number of surveyed employers; (i) to adopt the criteria of the non-hq methodology in determining whether a non-pensionable allowance should be established; (j) to adopt the criteria of the non-hq methodology in determining whether benefits should be quantified on the basis of market value or employer cost; (k) to make the working hours adjustment at gross salary levels consistent with the non-hq methodology; (l) to emphasize the use of the interpolated 75th percentile method in determining outside matching salaries per job; (m) to adopt the dual pay-line method in comparing net salaries per grade; (n) to include the interim adjustment process in the methodology document. ICSC requested its secretariat to make the appropriate revisions to the current methodology, in consultation with representatives of the organizations and the staff, and to provide it with the revised methodology at its 27th session for its approval [ICSC/26/R.25, paras. 75 and 76]. ICSC had before it a document prepared by CCAQ on the operation of the general methodology for salary surveys at non-hq duty stations. ICSC noted the organizations' satisfactory experience in applying the methodology to date and decided to schedule an in-depth review at a future session, at which time it would examine, inter alia, the specific points raised by the organizations regarding the determination of pensionable and non-pensionable elements of remuneration and the quantification of low-interest loans and in-kind meal benefits [ICSC/26/R.25, paras. 77 and 81] th session (March): ICSC considered the draft text (ICSC/27/R.10) of the revised methodology for HQ duty stations incorporating the changes to the general methodology adopted in 1982 that it had approved at its 26th session [ICSC/27/R.24, para. 108]. ICSC decided that it had not received any new information that would alter the decisions, it had taken at its 26th session, regarding: (a) exclusion of employers from the survey analysis; (b) quantification of benefits. As part of its consideration at its 26th session, it had also decided to maintain much of the methodology in use at that time, including with regard to the treatment of other elements of paid (cash) remuneration as

11 Compendium Page described in paragraphs 42 (a) and (b) of document ICSC/27/R.10. ICSC was not convinced that there was a need to change its decision as proposed by CCISUA. With regard to the clarification of the proposed text of the methodology ICSC decided that: (a) the description of a subsidized meal should be maintained; (b) the description of data based on minimum/maximum or average salaries could be further revised; (c) for interim adjustments between comprehensive surveys, the reference period should be so selected as to avoid the need for retroactive payments; (d) background and explanatory material should be deleted from the final text of the methodology; (e) an explanation of selected aspects of the data and analysis process should be provided in annexes to the methodology (specifically with regard to the 75th percentile method, logarithmic weighting and the dual pay-line method). With regard to the survey questionnaire ICSC agreed to certain minor revisions as proposed by FICSA. ICSC also decided to include in the methodology a number of annexes on selected aspects of the data analysis process. Some of ICSC's decisions, particularly the deletion of background and explanatory material, had a consequent effect on the text of the methodology [ICSC/27/R.24, paras ]. The final text of the revised methodology for HQ duty stations was issued in document ICSC/27/R nd session (July/August): ICSC addressed a point of clarification in the application of the interim adjustment procedure for use between surveys, which had arisen in the context of the New York survey in This involved the date when the interim adjustment procedure, approved by ICSC at the time of the previous GS survey, should cease to operate. ICSC was informed that the secretariat normally discouraged interim adjustments on the survey reference date or between the survey reference date and ICSC consideration of the survey results. It was noted, however, that the issue was not explicitly dealt with in either the HQ or the non-hq survey methodology. ICSC decided to review the issue in the context of the review of the HQ survey methodology at its 35th session [ICSC/32/R.24, paras. 31 and 38] In resolution 45/241, the GA noted that ICSC would review in 1991 the methodology for the conduct of salary surveys of the GS and related categories and requested ICSC to present a report on this matter to the GA at its 47th session (1992). In the same resolution, the GA, recalling that the work programme of the JIU included a study on the question of grade overlap between the P and higher categories and other categories of staff in the UN common system, requested ICSC to consider the relativities between the terms and conditions of service of staff in the P and higher categories and those in other categories as well as the broader question of the recruitment and retention of staff.

12 Compendium Page th session (August): ICSC considered a document containing proposed arrangements for the review of the general methodology for surveys of best prevailing conditions at both HQ and non-hq duty stations (ICSC/34/R.10). It decided: (a) to request its secretariat to carry out consultations with representatives of the administrations and the staff at an informal working group prior to its 35th session to prepare a preliminary document which would enable it to provide policy guidance to a formal working group; (b) to establish a formal working group to be convened after that session, including members of ICSC and representatives of the administrations and staff to report to the 36th session; (c) to complete the review of the methodology for HQ duty stations in 1992 and to address the issue of the methodology for non-hq duty stations in 1993 [A/46/30, vol. I, paras 176 and 184]. By resolution 46/808, the GA noted the decision of ICSC to complete in 1992 its review of the methodology for conducting surveys of best prevailing conditions of employment for the GS and related categories of staff at HQ locations. It requested ICSC to conclude this review and to report thereon to the GA at its 47th session th session (March): ICSC considered the report of the above-mentioned informal working group on the review of the methodology for surveys of best prevailing conditions at HQ duty stations. Following an exchange of views on the issues highlighted in the report, ICSC decided to establish a working group, consisting of three ICSC members, three representatives of CCAQ and two representatives each of FICSA and CCISUA. Its terms of reference were to review the material provided to ICSC at the 35th session in the light of the views expressed, and to report to the 36th session its views on the Flemming principle, the modalities for its application and the survey methodology. Where revisions were required, they should be presented in the form of options for consideration by ICSC [ICSC/35/R.17, para. 121] th session (August): On the basis of a consideration of the report of the abovementioned working group, ICSC undertook a review of the general methodology for surveys of best prevailing conditions at HQ duty stations. ICSC noted that the Flemming principle used as a basis for determining the conditions of service for locally recruited GS staff and the manner of its interpretation had been the subject of several reviews since its adoption by the GA in The conditions of service of staff in the GS and related categories had been based on best prevailing conditions of employment in a given locality. Various efforts to define that principle further had not necessarily resulted in greater clarity. ICSC observed that the principle had evolved from "best prevailing rates" to "best prevailing conditions". Based on that evolution, the survey process allowed for the consideration of the conditions in a broader context. ICSC felt that comparisons of such conditions should not be limited to salaries

13 Compendium Page and allowances, but should encompass best prevailing overall conditions of employment of comparable employers. ICSC noted the importance of focusing on all aspects of the Flemming principle, which called for consideration of best prevailing practices. Both the "best" and the "prevailing" aspects of the principle should be borne equally in mind when applying the principle. ICSC had received no indication that organizations encountered recruitment and retention problems for this category of staff and concluded that the Flemming principle had been effective. ICSC concluded that the current methodology was basically sound, but required fine-tuning on a number of points as regards both the methodology itself and its application [A/47/30, paras. 218 and 219]. ICSC made a number of observations in that respect, as set forth in paras of its eighteenth annual report [A/47/30], and took decisions as follows in respect of the Flemming principle and the methodology: (a) basis for the determination of the conditions of service of the GS and related categories: the Flemming principle: to reaffirm the Flemming principle, as enunciated at ICSC's 15th session [A/47/30, para. 231]; (b) preparation phase: to instruct its secretariat prepare a training manual, along the lines of the existing manual for field surveys, to form the basis for an improved training programme on all aspects of applying the survey methodology; the secretariat should provide, as an integral part of the preparatory activities for each survey, a check-list of the relevant criteria pertaining to proposed employers for approval by the ICSC Chairman. Any comments received from representatives of administrations and staff would be submitted concurrently to the Chairman; (i) role of the secretariat: to revise the relevant provisions of the current methodology to reflect the role of the secretariat; (ii) selection of employers: to amend the condition in the current methodology as regards the inclusion of public service or parastatal institutions in the sample of employers; to set the minimum number of clerical and support employees per employer at 100 (where transitional measures were required to maintain reasonable continuity of employers between surveys, the requirement concerning the revised minimum number of employees would be applicable only to employers not previously surveyed; in any case, employers with less than 50 employees would be excluded); to modify the provisions of the methodology concerning the geographical location of employers; to maintain the current criterion regarding the requirement for length of establishment of employers, but to modify the methodology to read "and should have been established in the locality for at least several (that is, around five) years"; to reaffirm the requirement for systematic pay policies and to amend the text of the methodology concerning the desirability of a job evaluation system; to amend the definition of an employer so as to ensure, that when an employer had multiple sites in the locality that followed the same personnel policies, all staff at those sites should be considered in the data analysis. Questions regarding the

14 Compendium Page definition of an employer should be handled pragmatically in each survey; to maintain the current number of 20 employers to be retained for final analysis and to confirm the need for continuity in the group of comparator employers; to confirm that multinational employers could continue to be included in the sample of employers surveyed; (iii) selection of jobs: that the CCOG should form the basis for the relevant statistics of the GS workforce; to confirm that every effort should be made to include all grades in the benchmarks and that a large number of incumbents in each grade should be covered; to confirm that the typical number of survey job descriptions should be between 14 and 20, and that job descriptions should cover only one grade and that linked grades should not be considered; that controversial jobs should remain excluded from the survey process, and to confirm its expectations that recommendations to the Executive Heads to address the anomalies identified would be implemented; to confirm that grades with only a handful of common system incumbents should be excluded from the survey process; to include it its work programme a review of the application of the job classification standards at HQ duty stations; (iv) development of benchmarks: to instruct its secretariat to develop a set of typical benchmarks, to serve as a model for use in salary surveys; to provide additional information to employers, together with the benchmarks, which would show the position of the job in the hierarchy, as well as an overall description of the UN structure, including a description of the existing two categories of staff; (c) data collection phase: (i) job matching: that additional information, such as qualification requirements, should carry similar weight to the statement of duties and responsibilities in the matching process; (ii) educational qualifications: that, in cases where outside employers required a university degree for survey jobs, such matches could be accepted if the comparator jobs were held by staff who, like the senior GS staff in the common system, had reached this level of responsibility on the basis of extensive experience and knowledge. If such posts, however, were held by university graduates in the relatively early stage of their career, job matches would continue to be disallowed; (iii) disagreements: with regard to the handling of disagreements between members of the survey team, that if no consensus were reached among the team members, the matter would be brought to the Chairman for decision; (iv) type of salary data to be collected: that average salary data was the most appropriate data to collect and that individual salary data should be collected only where necessitated by local conditions; (v) cooperation of employers: to encourage administrations and staff organizations to explore means to improve the cooperation of employers; (d) data analysis phase: (i) elimination of employers: to delete the current rule in the methodology, whereby an employer would be excluded if the base salary plus other elements of remuneration for the lowest ranking employer resulted in average salaries 10 per cent or more below the next higher average salary for each job; to amend the

15 Compendium Page methodology regarding the elimination of employers; to provide for the elimination of an employer who followed personnel practices that were deemed to be unethical, illegal or improper; (ii) elimination of jobs: to confirm that the current criteria for the elimination of jobs remain unchanged, except that all jobs matched should have more than one incumbent, unless the job in question was clearly one-of-a-kind so that a larger number of incumbents could not reasonably be expected; (iii) quantification of fringe benefits: to replace the provision of the methodology concerning performance payments with one to the effect that performance payments of an exceptional nature based on the merit or productivity of individuals and not paid as part of salary should not be taken into account; adjustments should be made both upwards and downwards in the quantification of meal benefits; to confirm that no adjustments to the methodology were required regarding the quantification of low-interest loans; that, with regard to the basis for evaluating a benefit, the relevant provisions of the methodology should be revised to provide that a benefit should be evaluated at the cost to the employer and not at its normally recognized or computed market value; (iv) social security provisions: to note that the current practice regarding the collection of data on social security provisions should be continued; to confirm that no further specificity was required in ICSC decisions and recommendations regarding such issues as the separation payments in Vienna and Rome; (v) Netting down: that the netting-down procedures should be maintained and that the secretariat should continue to bring to the attention of ICSC any anomalous tax calculations; (vi) Employers not subject to taxation: to continue the current practice of excluding special tax provisions applicable to such staff of the surveyed employers; (vii) seventy-fifth percentile: to confirm the use of the 75th percentile method; (viii) Dominance: to confirm the use of logarithmic weighting to avoid dominance; (ix) Language: to discontinue inclusion of the language factor at the time of the next survey. Should this lead to a freeze of salaries, ICSC should consider a phased approach to the elimination of this element; (x) sex discrimination: that no amendments in the methodology were required on the issue of sex discrimination; (xi) internal matching points: that, in view of the use of the job classification system and dual pay-line methodology, no adjustments in respect of internal/external differences in length of service/seniority should be made to internal salary levels; to include salary data for staff in receipt of the extra longevity step approved by ICSC in 1984, at the next lower step; to include salary data for staff at steps beyond those approved by ICSC, at their actual step; (e) Decision phase, including construction of salary scale: (i) in order to satisfy rule 33.2 of the rules of procedure estimates should be made available to ICSC prior to adoption of any recommendation of a new scale to organizations; to confirm the need to keep the process transparent for all parties; (ii) periodic adjustments between surveys: to establish a uniform factor of 0.9 by which the index movement should be governed for purposes of periodic adjustments between surveys; interim adjustments should not take place for a six-month period prior to the reference date of a survey. Any payments due to staff as a result of this postponement would be applicable retroactively if this were justified by the survey results;

16 Compendium Page (f) Recruitment, retention and grade overlap: (i) that further study on the issue of recruitment and retention was not warranted at this time; (ii) to note the current extent of the grade overlap between the remuneration of the GS and related categories and the P category as identified by JIU and to recall in this regard that the salaries of the two categories of staff were based on two distinctly different methodologies [A/47/30, para. 251]. Following the decisions taken by ICSC on the above item, the representatives of FICSA and CCISUA informed ICSC that they had decided not to continue their participation in the ICSC deliberations on this subject [A/47/30, para. 9 and annex I]. Also during the course of the 36th session, an extraordinary Staff Assembly was held, in which the staff of various common system staff associations took part. The Assembly adopted a resolution which strongly urged that no change be made in the methodology for determining the pensionable remuneration of GS staff, or to the salary survey methodology for that category of staff. It also urged ICSC to recommend to the GA measures to restore the competitiveness of UN salaries [A/47/30, para. 10]. The GA, in resolution 47/216: (a) took note of the ICSC decisions in respect of the refinements and modifications to the methodology, on the understanding that such modifications would be taken into account beginning with the salary survey being carried out in Paris; (b) called upon all organizations to ensure that interim adjustments to salaries were not resumed until the ICSC recommendations based on the comprehensive GS salary survey were acted upon by the organizations; (c) regretted that it had not so far received the report on procedures to be taken in the event that the implementation of a GS salary survey was at variance with the ICSC recommendations; (d) welcomed the intention of the UN/SG to implement resolution 45/241; and (e) requested the UN/SG to provide the report no later than its 49th session th session (March): Review of the general methodology for surveys of best prevailing conditions of employment at non-hq duty stations. ICSC had requested its secretariat to carry out consultations with representatives of the administrations and staff and to present a document which would enable ICSC to review the non-hq methodology and to report thereon to the GA at its 48th session. It considered document ICSC/37/R.10 and Add.1, in which its secretariat reported on the conclusions of an informal working group. The report included background information on the development and application of the methodology, and a comparison between the methodologies for HQ and non-hq duty stations, as well as the experience of the organizations with the use of the current methodology. Also included in this review was the methodology for surveys in respect of NPOs [ICSC/37/R.18, paras ] ICSC decided to review the methodology once every 4 years at the end of each completed