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Under personnel reform legislation enacted in 1995, the Administrator of the Federal Aviation Administration (FAA) implemented a new personnel management system. The system is exempt from most governmentwide personnel laws, but is subject to change only if the Administrator consults and negotiates those changes with the exclusive bargaining representatives of FAA's employees. When FAA and labor cannot reach an agreement regarding changes in the personnel management system, the legislation requires that the Federal Mediation and Conciliation Service be used to reach an agreement, and if that step is unsuccessful, FAA's proposed changes become effective 60 days after FAA transmits its proposed changes, along with labor's objections and its reasons for the objections, to Congress. FAA's first labor negotiation following the reform legislation was with the National Air Traffic Controllers Association (NATCA), which represents, among others, FAA's 15,000 Air Traffic Controllers, Traffic Management Coordinators, and Traffic Management Specialists. Congress' letter asked us to review FAA's human capital system. Congress also raised several questions, including (1) How personnel reforms have affected FAA's budget and how compensation for FAA's unionized workforce compares with other government employees? and (2) What has FAA done to ensure that the federal budget and appropriations processes are used to guide labor compensation negotiations?

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