[Senate Report 108-223]
[From the U.S. Government Publishing Office]
108th Congress
SENATE
Report
2d Session 108-223
_______________________________________________________________________
Calendar No. 428
FEDERAL WORKFORCE FLEXIBILITY ACT OF 2003
__________
R E P O R T
of the
COMMITTEE ON GOVERNMENTAL AFFAIRS UNITED STATES SENATE
to accompany
S. 129
TO PROVIDE FOR REFORM RELATING TO FEDERAL EMPLOYMENT, AND FOR OTHER
PURPOSES
January 27, 2004.--Ordered to be printed
COMMITTEE ON GOVERNMENTAL AFFAIRS
SUSAN M. COLLINS, Maine, Chairman
TED STEVENS, Alaska JOSEPH I. LIEBERMAN, Connecticut
GEORGE V. VOINOVICH, Ohio CARL LEVIN, Michigan
NORM COLEMAN, Minnesota DANIEL K. AKAKA, Hawaii
ARLEN SPECTER, Pennsylvania RICHARD J. DURBIN, Illinois
ROBERT F. BENNETT, Utah THOMAS R. CARPER, Delaware
PETER G. FITZGERALD, Illinois MARK DAYTON, Minnesota
JOHN E. SUNUNU, New Hampshire FRANK LAUTENBERG, New Jersey
RICHARD C. SHELBY, Alabama MARK PRYOR, Arkansas
Michael D. Bopp, Staff Director and Chief Counsel
Jennifer A. Hemingway, Professional Staff Member
Joyce A. Rechtschaffen, Minority Staff Director and Counsel
Larry B. Novey, Minority Counsel
Amy B. Newhouse, Chief Clerk
Calendar No. 428
108th Congress
SENATE
Report
2d Session 108-223
======================================================================
FEDERAL WORKFORCE FLEXIBILITY ACT OF 2003
_______
January 27, 2004.--Ordered to be printed
_______
Ms. Collins, from the Committee on Governmental Affairs, submitted the
following
R E P O R T
[To accompany S. 129]
The Committee on Governmental Affairs, to which was
referred the bill (S. 129) to provide for reform relating to
Federal employment, and for other purposes, having considered
the same, reports favorably thereon with an amendment and
recommends that the bill do pass.
CONTENTS
Page
I. Purpose and Summary..............................................1
II. Background.......................................................2
III. Legislative History.............................................10
IV. Section-by-Section Analysis.....................................10
V. Estimated Cost of Legislation...................................15
VI. Evaluation of Regulatory Impact.................................19
VII. Changes to Existing Law.........................................19
I. Purpose and Summary
S. 129, the Federal Workforce Flexibility Act, is a bill to
modernize and update certain rules relating to Federal
employment. The purpose of the legislation is to augment
existing statutory authorities and to provide additional
flexibilities to Federal agencies in the management of their
human resources. Several of the provisions are designed to
assist the Federal government in recruiting and retaining a
high quality workforce. The legislation amends current law with
regard to critical pay authority, computation of annuities for
certain individuals with part-time service, agency training
activities, annual leave, and recruitment and retention
bonuses. In addition, the legislation codifies retirement
service credit for individuals enrolled at the military service
academies, and establishes career-reserve Senior Executive
Service positions at the White House.
II. Background
The average Federal employee is 47 years old, and by 2005,
the Office of Personnel Management (OPM) reports that over 50
percent of the Federal workforce will be eligible for early or
regular retirement.\1\ Although OPM reports that those eligible
for retirement are not immediately leaving the federal
workforce and that the current retirement rate is similar to
that in previous years, the potential departure of such a large
number of Federal employees could result in the loss of
considerable institutional knowledge and skills. In addition,
fewer college graduates are expressing interest in pursuing
public sector careers, creating the possibility that Federal
agencies will not have adequate personnel to provide the
services the American people expect from their government.\2\
Among the reasons cited by young Americans for their decisions
to pursue alternate employment is the Federal government's
lengthy, impersonal hiring process and the perception that its
dense bureaucratic processes stifle the ability of employees to
realize the positive impact of their efforts or deny the
opportunity to make a difference.
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\1\ Office of Personnel Management, Central Personnel Data File,
www.opm.gov/feddata.
\2\ Partnership for Public Service/Hart-Teeter Survey: Recruitment
Problem Remains, Despite Increasing Respect for Government's Work Since
9/11, (September 12, 2002).
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At the request of this Committee, the General Accounting
Office (GAO) has issued a series of reports focusing on issues
affecting the government's ability to recruit, retain, and
motivate employees. One area of specific review is the
effective use of human capital flexibilities as an essential
element to acquiring, developing, and retaining high-quality
federal employees. In 2002, GAO found that the flexibilities
most effective in managing the workforce are work-life
programs, such as alternative work schedules, child care
assistance, and transit subsidies; monetary recruitment and
retention incentives; special hiring authorities; and incentive
awards for notable job performance and contributions, such as
cash and time-off awards.\3\
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\3\ General Accounting Office, HUMAN CAPITAL: Effective Use of
Flexibilities Can Assist Agencies in Managing Their Workforces, GAO-03-
2, November 2002.
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HISTORY
Since 1999, the Subcommittee on Oversight of Government
Management, the Federal Workforce and the District of Columbia
(and its predecessor, the Subcommittee on Oversight of
Government Management, Restructuring, and the District of
Columbia) [hereinafter referred to as ``OGM''] has conducted 13
hearings on the Federal government's strategic management of
human capital.
In December 2000, Senator Voinovich issued a report titled
``Report to the President: The Crisis in Human Capital,'' which
outlined two important themes on which OGM worked during the
106th Congress: empowering federal employees and highlighting
the critical importance of addressing the Federal government's
human capital challenges.
During the 107th Congress, a group of interested and
affected stakeholders began to coalesce around the need to
provide solutions to the challenges this public policy issue
presented for the Nation. In 2001, GAO designated strategic
human capital management a government-wide ``high-risk''
area,\4\ and President Bush included this issue as the first
priority in his President's Management Agenda.\5\
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\4\ High Risk Series: An Update (GAO-01-263, January 2001).
\5\ The President's Management Agenda, Fiscal Year 2002, Office of
Management and Budget, pp. 11-15.
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In March 2001, former Defense Secretary James Schlesinger
and Admiral Harry D. Train United States Navy (Ret.), members
of the U.S. Commission on National Security/21st Century,
testified before a joint hearing held by OGM and the House
Government Reform Subcommittee on Civil Service and Agency
Organization.\6\ Secretary Schlesinger discussed a
comprehensive evaluation on national security strategy and
structure that was recently undertaken by the Commission.
Regarding human capital, the Commission's final report
concluded:
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\6\ S. Hrg. 107-133.
As it enters the 21st century, the United States
finds itself on the brink of an unprecedented crisis of
competence in government. The maintenance of American
power in the world depends on the quality of U.S.
government personnel, civil and military, at all
levels. We must take immediate action in the personnel
area to ensure that the United States can meet future
challenges.\7\
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\7\ The United States Commission on National Security/21st Century,
Road Map for National Security: Imperative for Change (2001), p. 86.
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Secretary Schlesinger added further:
* * * it is the Commission's view that fixing the
personnel problem is a precondition for fixing
virtually everything else that needs repair in the
institutional edifice of U.S. national security
policy.\8\
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\8\ S. Hrg. 107-133, p. 36.
The September 11, 2001, terrorist attacks on New York City
and Washington, D.C. brought greater attention to the human
capital crisis the Commission had described. No longer the
``quiet crisis'' the National Commission on the Public Service
cited in 1989,\9\ the Federal government's human capital
challenges have received attention as potentially affecting the
manner in which the Federal government delivers services to the
taxpayer and protects the national interests of the United
States.
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\9\ ``Leadership for America: Rebuilding the Public Service,''
National Commission on the Public Service, 1989.
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Building on previous efforts on this issue, Senator George
Voinovich convened a human capital working group to define the
universe of human capital problems and work together to develop
and take action on solutions. The working group, which met four
times between June 2001 and July 2002, included Members of
Congress, officials from the Clinton and Bush Administrations,
and representatives of numerous nonprofit think tanks and
academic institutions.
In addition, the John F. Kennedy School of Government at
Harvard University played an important role in addressing the
human capital crisis by organizing a series of four executive
sessions on this topic during the 2001-2002 academic year.
Approximately 40 leaders on this issue from the government, the
private sector, think tanks and academia gathered to discuss
this important public policy issue. The executive sessions
addressed such issues as recruitment, hiring and retention at
the entry and mid-career levels, compensation reform, and
quality of life issues in the federal workplace.
As a result of the human capital working group and
executive sessions, Senator George Voinovich introduced S.
1603, the Human Capital Act of 2001, on October 31, 2001, and
subsequently S. 2651, the Federal Workforce Improvement Act of
2002, on June 20, 2002, which incorporated elements of S. 1603
and a similar Administration proposal. On March 18 and 19,
2002, Senator Daniel Akaka chaired a Governmental Affairs
Subcommittee on International Security, Proliferation, and
Federal Services hearing entitled: ``The Federal Workforce:
Legislative Proposals for Change,'' which reviewed these
bills.\10\ The hearing continued the dialogue on the proposed
reforms, including the challenges of appropriately implementing
the proposals and the needed commitment from the highest levels
of government to allocate the resources necessary to achieve a
strong and vibrant workforce. In the House of Representatives,
Representative Connie Morella introduced a companion bill, H.R.
4580, the Good People, Good Government Act, in April 2002.
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\10\ S. Hrg. 107-470.
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At the same time, the second National Commission on the
Public Service was created to focus attention on the need for
comprehensive reform in the federal public service. On July 18,
2002, Senator Daniel Akaka and Senator George Voinovich
testified before the Commission along with other members of
Congress and discussed the need for certain reforms to the
federal service. In the Commission's final report, issued in
January 2003, the Commission recommended that more flexible
personnel management systems should be developed to meet
agencies' needs.\11\
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\11\ National Commission on the Public Service, Urgent Business for
America: Revitalizing the Federal Government for the 21st Century,
January 2003, pp. 27.
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During the Governmental Affairs Committee's July 24-25,
2002, business meeting to consider S. 2452, the National
Homeland Security and Combating Terrorism Act of 2002, Senators
Voinovich and Akaka offered an amendment to add several major
provisions of S. 2651 to S. 2452. The Committee agreed
unanimously to the amendment. On November 22, 2002, Congress
enacted the Homeland Security Act of 2002,\12\ which included
11 government-wide human capital reform provisions from S.
2651. The enactment of this legislation marked the first major,
government-wide revisions to civil service law since the
enactment of the Civil Service Reform Act of 1978.\13\
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\12\ Public Law 107-296.
\13\ Public Law 95-454.
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To further improve the federal government's ability to
recruit and retain a world-class 21st century workforce,
Senator George Voinovich introduced in the 108th Congress the
Federal Workforce Flexibility Act of 2003, S. 129, which
included some of the remaining provisions in S. 2651. The
sections that follow discuss the various elements of S. 129, as
amended, as well as their significance.
ENHANCED BONUS AUTHORITY
S. 129 would allow federal agencies to use recruitment,
relocation and retention bonuses in a more strategic manner to
help the government improve its competitiveness in maintaining
a high quality workforce. The current bonus authorities already
offer agencies important tools for recruiting and retaining key
employees to perform critical functions. The existing
authorities were authorized by the Federal Employees Pay
Comparability Act of 1990 (FEPCA).\14\ Under FEPCA, agencies
are authorized to pay a lump-sum recruitment or relocation
bonus of up to 25 percent of the annual rate of basic pay to an
employee newly appointed to a difficult-to-fill position. FEPCA
also authorized agencies to pay a retention allowance of up to
25 percent of basic pay to an employee if the unusually high or
unique qualifications of the employee or a special need of the
agency for the employee's services makes it essential to retain
the employee, and the agency determines that the employee would
be likely to leave the Federal service without the allowance.
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\14\ Public Law 101-509.
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A 1999 OPM evaluation found that limited funding and
limited opportunities for recruitment because of downsizing
contributed to restricted agency use of these bonus
authorities. Allowing flexibility in the methods of payment and
raising the maximum amounts were among the suggestions raised
by agencies in responding to the report.\15\ S. 129 would allow
an agency head to waive the 25% limitation based on a critical
agency need, subject to OPM's regulations. Under a wavier, the
amount of the bonus could be up to 50% of the employee's annual
basic pay rate at the beginning of the service period,
multiplied by the number of years in the service period, not to
exceed 100% of the employee's annual basic pay rate at the
beginning of the service period. Agencies would be required to
establish plans for paying recruitment and relocation bonuses
before paying such bonuses. By expanding the circumstances in
which recruitment, relocation and retention bonuses may be paid
and by enabling agencies to make the payments in more strategic
ways that enhance their desired effect, this section would help
federal agencies recruit and retain the kind of workforce they
will need in the 21st century. These changes are particularly
appropriate to the current environment in which federal
agencies are engaged in keen competition for the most qualified
candidates.
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\15\ U.S. Office of Personnel Management, Office of Merit Systems
Oversight and Effectiveness, Report of a Special Study; The 3Rs:
Lessons Learned from Recruitment, Relocation, and Retention Incentives
(Washington: OPM, 1999), p. 33.
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S. 129 would amend current law to add an additional basis
for paying a retention allowance. Specifically, the legislation
would amend current law to state that agencies which determine
that an employee would likely leave for a different federal
position, in the absence of a bonus, would be authorized to pay
a retention bonus to the employee. Prior to receiving a
retention allowance, an employee would have to enter into a
written service agreement to complete a period of employment
with the agency.
The enhanced bonus authority could not be used to pay an
employee in a position to which an individual is appointed by
the President, by and with the advice and consent of the
Senate; a non-career appointee position in the Senior Executive
Service; or a position that has been excepted from the
competitive service by reason of its confidential, policy-
making, or policy-advocating character.
MODIFICATION OF CRITICAL PAY AUTHORITY
Under current law, the Office of Management and Budget
(OMB), in consultation with OPM, may, upon the request of an
agency head, grant authority to fix the rate of basic pay for
one or more critical positions in an agency at not less than
the rate that would otherwise be payable for that position, but
not greater than the rate payable for Level I of the Executive
Schedule, except upon the President's written approval.\16\ In
order to apply critical pay authority, the position must
require a very high level of expertise in a scientific,
technical, or administrative field and be crucial to the
accomplishment of an agency's mission. Although the federal
government is authorized to fill up to 800 critical pay
provisions, at present only 13 have been filled.
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\16\ 5 U.S.C. Sec. 5377.
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S. 129 would shift oversight of the federal government's
critical pay authority, from the Office of Management and
Budget (OMB) to the Office of Personnel Management (OPM), in
order to encourage increased application of this underutilized
flexibility as a means of attracting talented individuals to
critical positions in the federal government for short periods
of time. As the agency charged with assisting the executive
branch to meet its growing human capital demands, OPM currently
works directly with other agencies to ensure that they
strategically use the broad range of existing human resource
management tools to recruit, retain, and manage a high-
performing workforce. OPM is committed to increased use of this
authority, which would allow the federal government to realize
the benefits of talented individuals whose expertise could
improve agencies' efficiency and effectiveness.
CORRECTION OF A RETIREMENT ANOMALY FOR PART-TIME SERVICE
The Federal Workforce Flexibility Act would also change the
computation of Civil Service Retirement System (CSRS) annuities
involving part-time service by correcting an anomaly that is a
disincentive for employees nearing the end of their careers who
would like to phase into retirement by working part-time
schedules. Specifically, the legislation would clarify that
CSRS annuities based in whole or in part on part-time service
should be pro-rated for the period of service that was
performed on a part-time basis. The correction allows agencies,
as part of their succession planning efforts, to retain the
expertise of senior staff who wish to work on a part-time basis
at the end of their federal careers.
CSRS annuities are computed based on an average of an
employee's highest three years of salary, multiplied by a
factor representing their years of service. Before 1986,
employees who worked part-time could switch to a full-time
schedule in the last three years of service and thereby reap a
benefit equal to that of an employee who worked full-time for
an entire career. In 1986, Congress decided to reverse the
computation formula so that the computation of part-time
service performed after April 6, 1986, is based on a deemed
full-time high-three average salary, multiplied by the factor
representing years of service. The resulting benefit is then
reduced by a fraction representing the actual time worked over
the equivalent full-time service. Because this new computation
applied only to service performed after April 6, 1986, the old
formula continued to apply to service performed before that
date. Consequently, if an employee with substantial full-time
service before 1986 switches to a part-time schedule at the end
of his career, the high-three average salary that is applied to
service before 1986 is the pro-rated salary or, if higher, the
full-time salary from the years before the employee began
working part-time. This often results in a disproportionate
reduction in the employee's benefit.
Under current law, the adverse impact of working part-time
just prior to retirement results from the requirement to use
the actual salary received in computing the pre-April 1986
average salary. This results in using a pro-rated, or lower,
salary even though all service before 1986 may have been full-
time.
The following is an example of the change in part-time
annuity computations that would result from enactment of S.
129. Assume an employee worked full-time from April 1976
through April 2001, converted to part-time status in April 2001
and worked 20 hours per week until retirement in April 2006,
the employee's full-time and (part-time) salary rates are as
follows:
2000--$40,000
2001--$41,000
2002--$42,000
2003--$43,000 ($21,500)
2004--$44,000 ($22,000)
2005--$45,000 ($22,500)
2006--$46,000 ($23,000)
Under current law, using the salary rates listed above, the
employee would receive an annual benefit of $22,412, based on
an average salary of $41,000 applied to pre-1986 service. Under
S. 129, the employee would receive an annual benefit of $23,062
because the person's highest salary, including his or her
deemed full-time salary for years of part-time work, would be
used in computing the benefit derived from the pre-1986
service. The degree of difference in the computations in any
particular case is dependent upon the employee's actual tour of
duty, the length of part-time service before retirement, and
the true salary progression. The computation follows:
Computation under current law
Annuity computation
Pre-April 1986: $41,000 .1625 = $6,662
Post-April 1986: $45,000 .40 = $18,000
.875 (Proration factor) = $15,750
Annual benefit (Add pre- and post-April 1986 benefits)
$6,662 + $15,750 = $22,412
Computation under S. 129
Pre-April 1986: $45,000 .1625 = $7,312
Post-April 1986: $45,000 .40 = $18,000
.875 (Proration factor) = $15,750
Annual benefit (Add pre- and post-April 1986 benefits)
$7,312 + $15,750 = $23,062
RETIREMENT CREDIT FOR CADETS AND MIDSHIPMAN
Under current law, a federal employee who served in the
armed forces can count his or her military service toward a
civilian retirement annuity, provided that the employee makes a
deposit tothe Civil Service Retirement and Disability Fund
equal to the amount that would have been withheld from his or her
military pay if military service had been covered under the civilian
retirement system. S. 129 would ratify the long-standing practice of
OPM (and, previously, the Civil Service Commission) of granting credit
under the CSRS and the Federal Employees' Retirement System (FERS) for
time spent as a cadet or midshipman at one of the military service
academies, provided that he or she makes a deposit to the Civil Service
Retirement and Disability Fund equal to the amount that would have been
withheld from his or her cadet or midshipman stipend if the service had
been covered. Granting retirement credit recognizes that some members
of the armed services begin their federal service at the academies, and
can serve as an incentive for those considering an extended career in
the federal government.
SENIOR EXECUTIVE HIRING AUTHORITY
The Federal Workforce Flexibility Act would provide
authority for the White House Office of Administration to
employ senior executives. S. 129 would require that any
permanent Senior Executive Service positions established be
career reserved positions. The hiring process for career
appointees to the Senior Executive Service is a merit-based
selection process under existing law.\17\ All statutory rights
and protections that apply generally to senior executives in
career reserved positions in agencies would be applicable. The
employment of career senior executives will help build the
capability needed to address administrative, knowledge and
other challenges important to the analysis of current and
future issues before the executive branch, while providing an
opportunity for individual civilian employees to further
develop their management skills.
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\17\ 5 U.S.C. Sec. 3393.
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This new section also would ensure that the ceiling
applicable to General Schedule positions does not apply to the
new senior executive positions, and it updates a reference to a
grade of the General Schedule that no longer exists.
TRAINING COORDINATION
Continuous investment in training and workforce development
is essential for improving the performance of the federal
government. S. 129 contains several provisions that are
designed to assist agencies in coordinating their training
programs. The legislation would amend current law \18\ to
require agencies to link training activities with performance
plans and strategic goals in performing the agency mission, in
order to help ensure that the federal government's training
resources are appropriately used. S. 129 would require each
agency to appoint or designate a training officer, who would be
responsible for developing, coordinating and administering
agency training. The individual could be the same person as the
Chief Human Capital Officer. Agencies would also be required to
institute comprehensive management succession programs designed
to develop future leaders; and provide special training to
managers to help them deal with poor performers. The training
plans would be developed in consultation with OPM. Several
agencies already have such initiatives, such as the Defense
Leadership Management Program at the Department of Defense.
Combined, the provisions create a renewed emphasis on the
importance of training.
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\18\ 5 U.S.C. Sec. 4103.
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ANNUAL LEAVE ENHANCEMENTS
Current law provides for accrual of annual leave at four
hours per biweekly pay period for individuals with less than
three years of federal service, six hours of leave for any
employee with between three and 15 years of service, and eight
hours of leave for any employee with a minimum of 15 years of
service.\19\ The Federal Workforce Flexibility Act would reform
the annual leave accrual policy for new mid-career federal
employees, allowing agency heads to deem a period of qualified
non-federal career experience for an individual an equal period
of service performed as a federal employee. The legislation
also provides that all senior executives and other senior level
employees accrue annual leave at the maximum rate of eight
hours for each bi-weekly pay period.
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\19\ 5 U.S.C. Sec. 6303.
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Individuals with substantial private sector experience may
be hesitant to enter government service if they have to
surrender a considerable amount of vacation time. By allowing
them to accrue annual leave at the rate of six or eight hours
per biweekly pay period (i.e., 20 and 26 days per annum,
respectively) instead of the four hours (i.e., 13 days per
annum) currently specified by law, agencies will have a greatly
enhanced capability to recruit qualified mid-career
individuals.
COMPENSATORY TIME FOR TRAVEL
Under current law, the time that an employee spends in a
travel status away from his or her official duty station is not
considered to be hours of employment unless specific
requirements are met.\20\ The requirements are that (1) the
time spent is within the days and hours of the employee's
regularly scheduled workweek, or (2) the travel involves the
performance of work while traveling, is incident to travel that
involves the performance of work while traveling, is carried
out under arduous conditions, or results from an event that
could not be scheduled or controlled administratively. In light
of the fact that work-life programs are among the most
effective recruitment and retention tools,\21\ the Committee
believes that federal employees should receive compensation
while traveling on the government's business. S. 129 would
require federal agencies to provide employees compensatory time
off for time spent by employees in travel status away from
their official duty stations, to the extent the time spent in
travel status is not otherwise compensable. Employees receiving
compensatory time off for travel would not be entitled to
payment for unused compensatory time earned under this new
statutory requirement. OPM would prescribe regulations to
implement the provision no later than 30 days after enactment.
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\20\ 5 U.S.C. Sec. 5542(b)(2).
\21\ General Accounting Office, HUMAN CAPITAL: Effective Use of
Flexibilities Can Assist Agencies in Managing Their Workforces, GAO-03-
2, November 2002.
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III. Legislative History
S. 129 was introduced on January 9, 2003, by Senator George
V. Voinovich and was referred to the Senate Committee on
Governmental Affairs. On March 21, 2003, the bill was referred
to the OGM Subcommittee. A hearing on S. 129 was held before
the Subcommittee on Oversight of Government Management, the
Federal Workforce and the District of Columbia on April 8,
2003.
On June 11, 2003, the Subcommittee on Oversight of
Government Management, the Federal Workforce and the District
of Columbia favorably polled out S. 129. On October 22, 2003,
the Committee on Governmental Affairs met in open session and
by voice vote agreed to a manager's amendment to S. 129,
offered by Senator Voinovich and cosponsored by Senator Akaka,
and by voice vote, ordered S. 129 reported favorably with the
amendment. The manager's amendment differed from the original
bill by, among other things--(a) prohibiting the use of the
enhanced bonus authority for political appointees; (b)
requiring OPM to submit an annual report to the Senate
Governmental Affairs Committee and the House Government Reform
Committee describing agency use of the enhanced bonus
authorities; (c) providing compensatory time off for federal
employee travel during hours not otherwise compensable; (d)
granting retirement credit for cadet or midshipman service at
military service academies; (e) authorizing the White House
Office of Administration to establish and fill career reserved
senior executive positions, and (f) omitting provisions, which
were in the original bill, involving streamlined personnel
management demonstration projects and law enforcement officer
relocation payments. Senators present: Akaka, Bennett, Coleman,
Collins, Fitzgerald, Lautenberg, Levin, Pryor, and Voinovich.
IV. Section-by-Section Analysis of Bill as Amended
Sec. 101. Recruitment, relocation and retention bonuses
Subsection (a) adds new sections 5754a and 5754b to title
5, U.S. Code, to allow the Office of Personnel Management to
authorize the head of an agency to pay a bonus to an individual
appointed or moved to a position that is likely to be difficult
to fill in absence of such a bonus in certain cases. The new
Sec. Sec. 5754a and 5754b are in addition to existing bonus
authority (5 U.S.C. Sec. 5753 and 5 U.S.C. Sec. 5754), which
remains in effect. Agencies can use either or both existing and
new authority.
New Sec. 5754a. is entitled, ``Recruitment and retention
bonuses.''
Subsection (a) of new Sec. 5754a defines the term
``employee.''
Subsection (b) of new Sec. 5754a states that OPM may
authorize the head of an agency to pay a bonus to an individual
appointed or moved to a position that is likely to be difficult
to fill in absence of a bonus.
Subsection (c)(1) of new Sec. 5754a states that the bonuses
shall be contingent upon the employee entering into a written
service agreement to complete a certain period of employment,
not to exceed four years.
Subsection (c)(2) of new Sec. 5754a states that the written
service agreement must include the length of the required
service period; the amount of the bonus; the method of payment;
and the terms and conditions under which the bonus is payable,
including the conditions under which the agreement may be
terminated before the agreed-upon service period has been
completed.
Subsection (c)(3) of new Sec. 5754a states that the
agreements shall be made effective upon employment or
relocation, unless an exception is made to allow for an initial
period of formal basic training.
Subsection (d)(1) of new Sec. 5754a states that bonuses
shall not exceed 25 percent of the annual rate of basic pay of
the employee at the beginning of the service period multiplied
by the number of years of the service period, not to exceed 4
years.
Subsection (d)(2) of new Sec. 5754a states that bonuses may
be paid as an initial lump sum, in installments, or as a final
lump sum upon the completion of the service period, or in a
combination of these forms of payment.
Subsection (d)(3) of new Sec. 5754a clarifies that bonuses
under this section are not part of the basic pay of an
employee.
Subsection (d)(4) of new Sec. 5754a states that the Office
of Personnel Management may prescribe regulations to allow
recruitment bonuses to be paid to an eligible individual before
that individual enters on duty.
Subsection (e) of new Sec. 5754a states that the Office of
Personnel Management may authorize an agency head to waive the
25 percent cap under subsection (d)(1), allowing the amount of
the bonus to be up to 50 percent of the employee's annual rate
of basic pay multiplied by the number of years of the service
period, not to exceed 100 percent of the employee's annual rate
of basic pay at the beginning of the service period.
Subsection (f) of new Sec. 5754a states that the Office of
Personnel Management shall require that each agency establish a
plan for paying recruitment and relocation bonuses before such
bonuses are paid.
Subsection (g) of new Sec. 5754a authorizes the Office of
Personnel Management to issue regulations to carry out Section
101, including regulations relating to the repayment of
recruitment or relocation bonuses when the agreed upon service
period has not been met.
Subsection (h)(1) of new Sec. 5754a states that, at the
request of the head of an Executive agency, the Office of
Personnel Management may extend coverage under this section to
categories of employees otherwise not eligible.
Subsection (h)(2) of new Sec. 5754a states that none of the
bonuses authorized under Section 101 may be paid to an
individual who holds a political appointment (Senate confirmed,
non-career Senior Executive, or General Schedule) in an
executive branch agency.
Subsection (i) of new Sec. 5754a requires OPM to report
annually to Congress on the bonuses paid under this authority
to the Committee. The report must include the use of each
agency of recruitment and relocation bonuses, including the
number and amount of bonuses by grade.
Subsection (j) of new Sec. 5754a makes it clear that
individuals may not be paid a recruitment or relocation bonus
under this section if they are receiving the same category of
bonus under 5 U.S.C. Sec. 5753.
New Sec. 5754b is entitled, ``Retention bonuses.''
Subsection (a) of new Sec. 5754b defines the term
``employee.''
Subsection (b) of new Sec. 5754b states that the Office of
Personnel Management may authorize the head of an agency to pay
a retention bonus to an employee if the employee possesses
unusually high or unique qualifications make it essential for
the employee's retention. Additionally, the agency is required
to make a determination that in the absence of a retention
bonus the employee would be likely to leave the federal service
or take a different position in the federal service, as
described in regulation.
Subsection (c) of new Sec. 5754b states that the Office of
Personnel Management may authorize the head of an agency to pay
retention bonuses to a group of employees in one or more
categories of positions in certain geographic areas, if the
agency perceives a high risk that a significant portion of
employees in the group would be likely to leave without such
bonus.
Subsection (d) of new Sec. 5754b states that except as
provided in new Sec. 5754j, a retention bonus under new
Sec. 5754b may be paid only to an employee covered by the
General Schedule pay system established under subchapter III of
chapter 53, title 5, United States Code.
Subsection (e) of new Sec. 5754b states that payment of a
retention bonus is contingent upon the employee entering into a
written service agreement with the agency to complete a period
of employment.
Subsection (e)(2) of new Sec. 5754b states that the
agreement must include the length of the required service
period; the amount of the bonus; the method of payment; and the
terms and conditions under which the bonus is payable,
including the conditions under which the agreement may be
terminated before the agreed-upon service period has been
completed.
Subsection (e)(3) of new Sec. 5754b states that a written
service agreement is not required if the agency pays a
retention bonus in biweekly installments and sets the
installment payment at the full bonus percentage rate
established for the employee, with no portion of the bonus
deferred.
Subsection (e)(4) of new Sec. 5754b states that a retention
bonus for an employee may not be based on any period of service
which is the basis for a recruitment or relocation bonus under
5 U.S.C. Sec. 5753 or Sec. 5754a.
Subsection (f) of new Sec. 5754b states that a retention
bonus may not exceed 25 percent of the employee's basic pay if
the bonus is paid to an individual under subsection (b), and 10
percent of the employee's basic pay if the bonus is paid to a
group of employees under subsection (c).
Subsection (f)(2) of new Sec. 5754b states that a retention
bonus may be paid to an employee in installments after
completion of specified periods of service or in a single lump
sum at the end of the full period of service required by the
agreement in subsection (e).
Subsection (f)(3) of new Sec. 5754b makes it clear that a
retention bonus is not part of the basic pay of an employee.
Subsection (g) of new Sec. 5754b states the Office of
Personnel Management may, at the request of the head of an
agency, may waive the percentage limit under subsection (f)(1)
and permit the agency head to pay an otherwise eligible
employee or group of employees retention bonuses of up to 50
percent of basic pay, based on critical need.
Subsection (h) of new Sec. 5754b states that the Office of
Personnel Management shall require that, before paying a bonus
under this section, an agency shall establish a plan for paying
retention bonuses.
Subsection (i) of new Sec. 5754b authorizes the Office of
Personnel Management to issue regulations to carry out this
section.
Subsection (j) of new Sec. 5754b states that a retention
bonus under this section may not be paid to an individual who
holds a political appointment (Senate confirmed, non-career
Senior Executive, or General Schedule) in an executive branch
agency.
Subsection (k) of new Sec. 5754b requires the Office of
Personnel Management to submit an annual report to the
Committee on retention bonuses paid under this section. The
report shall include the use by each agency of retention
bonuses, including the number and amount of bonuses by grade.
Subsection (l) of new Sec. 5754b states that an employee
may not be paid a retention bonus under this section and a
retention allowance under 5 U.S.C. Sec. 5754.
The new bonus authorities under section 101 will take
effect on the first day of the first applicable pay period
beginning on or after 180 days after the enactment date. It
further provides that a recruitment or relocation bonus service
agreement in effect prior to the changes would continue in
effect. Additionally, payment of a retention allowance
authorized previously shall continue in effect until
reauthorized or terminated, but for no longer than one year.
Sec. 102. Streamlined critical pay authority
This section would amend 5 U.S.C. Sec. 5377, by shifting
oversight and the current statutorily requiredreporting
authority from the Office of Management and Budget to the Office of
Personnel Management.
Subsection (f) of amended Sec. 5377 would limit the Office
of Personnel Management's authority to offer critical pay to no
more than 800 positions at any one time.
Subsection (g) of amended Sec. 5377 would require the
Office of Personnel Management to consult with the Office of
Management and Budget before making any decision to grant or
terminate any critical pay authority.
Sec. 103. Civil Service Retirement System computation for part-time
service
This section would amend section 5 U.S.C. Sec. 8339(p) by
adding a new subsection (3) to provide a special annuity
computation formula for employees who performed part-time
service after April 7, 1986. For these employees, this section
would extend application of full-time rates of pay in computing
average salary to all service, regardless of when it was
performed.
New Sec. 8339(p)(3) would state that subparagraph (a) of
Sec. 8339(p)(1) would apply to any service performed before, on
or after April 7, 1986; subparagraph (b) of Sec. 8339(p)(1)
would apply to all service performed on a part-time or full-
time basis on or after April 7, 1986; and subparagraph (c) of
Sec. 8339(p) would that any service performed on a part-time
basis before April 7, 1986, would be credited as service
performed on a full-time basis.
Sec. 104. Retirement service credit for cadet or midshipman service
Subsection (a) would amend 5 U.S.C. Sec. 8331(13) to
include an individuals service as a cadet or midshipman for the
purposes of calculating an annuity under the Civil Service
Retirement System.
Subsection (b) would amend 5 U.S.C. Sec. 8401(31) to
include an individuals service as a cadet or midshipman for the
purposes of calculating an annuity under the Federal Employees
Retirement System.
Subsection (c) provides the effective date and
applicability of this section. The section shall apply to (1)
any annuity, eligibility for which is based upon a separation
before, on, or after the date of enactment; and (2) any period
of service as a cadet or midshipman at the military service
academy of the Army, Air Force, Coast Guard, or Navy occurring
before, on, or after enactment.
Sec. 105. Senior Executive Service authority for White House Office of
Administration
This section would amend chapter 2 of title 3, United
States Code, by adding a new section to provide authority for
the White House Office of Administration to establish Senior
Executive Service positions. The new section would state that
the positions are expressly designated as career reserved,
restricting the use of limited appointments to temporary
positions. This new section also would ensure that the ceiling
applicable to General Schedule positions does not apply to the
new senior executive positions, and it updates a reference to a
grade of the General Schedule that no longer exists.
Sec. 201. Agency training
Subsection (a) would amend 5 U.S.C. Sec. 4103 to require
agencies to link training activities with performance plans and
strategic goals, and clearly articulate how their training
programs help to accomplish the agency's mission.
Subsection (b) would amend chapter 41 of title 5, United
States Code, by adding a new section to require each agency to
appoint or designate a training officer, who would be
responsible for developing, coordinating and administering
training for the agency.
Subsection (b) also would require agencies to work with the
Office of Personnel Management to institute comprehensive
management succession programs designed to develop future
managers for the agency. Subsection (b) would also require
agencies, in consultation with the Office of Personnel
Management, to provide special training to managers to help
those employees exhibiting unacceptable performance.
Sec. 202. Annual leave enhancements
Subsection (a) would amend 5 U.S.C. Sec. 6303 to reform the
policy which dictates the accrual of annual leave for newly-
hired mid-career federal employees. This section would add a
new subsection (e) to 5 U.S.C. Sec. 6303, that would allow the
head of an agency to deem a period of qualified non-federal
career experience for an individual an equal period of service
performed as a federal employee. This subsection would take
effect 120 days after the date of enactment of S. 129, and
shall only apply to an individual hired on or after the
effective date.
Subsection (b) would amend section 5 U.S.C. Sec. 6303(a),
to provide that all senior executives and other senior level
employees accrue annual leave at the maximum rate: one day
(eight hours) for each bi-weekly pay period. It also would
authorize OPM to extend coverage of this section to other
equivalent categories of employees. This subsection would take
effect 120 days after the date of enactment of S. 129.
Sec. 203. Compensatory time off for travel
Subsection (a) of this section would amend 5 U.S.C.
Sec. 5550, to require federal agencies to provide employees
compensatory time off for time spent by employees in travel
status away from their official duty stations, to the extent
the time spent in travel status is not otherwise compensable.
Subsection (b) states that employees receiving compensatory
time off for travel would not be entitled to payment for unused
compensatory time earned under this new statutory requirement.
V. Estimated Cost of Legislation
CONGRESSIONAL BUDGET OFFICE COST ESTIMATE
S. 129--Federal Workforce Flexibility Act of 2003
Summary: S. 129 would amend laws affecting civilian
employees of the federal government. Major provisions of the
bill would increase federal retirement benefits for some
workers who performed part-time service and would affect the
way time spent at a U.S. military academy is credited for
retirement purposes. The legislation also would amend current
laws related to recruitment, relocation, and retention bonuses,
as well as agency training.
CBO estimates that enacting S. 129 would increase direct
spending by $4 million in 2004, $71 million over the 2004-2008
period, and $233 million over the 2004-2013 period. Enacting
the bill would increase revenues by less than $500,000 annually
starting in 2005. In addition, CBO estimates that implementing
S. 129 would cost $351 million over the 2004-2008 period and
$756 million over the 2004-2013 period for various
administrative requirements--assuming appropriation of the
necessary amounts.
S. 129 contains no intergovernmental or private-sector
mandates as defined in the Unfunded Mandates Reform Act (UMRA)
and would not affect the budgets of state, local, or tribal
governments.
Estimated Cost to the Federal Government: The estimated
budgetary impact of S. 129 is shown in the following table. The
direct spending costs of this legislation fall within budget
function 600 (income security); the spending subject to
appropriation would fall across multiple budget functions.
----------------------------------------------------------------------------------------------------------------
By fiscal year, in millions of dollars--
---------------------------------------------------------------------
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
----------------------------------------------------------------------------------------------------------------
CHANGES IN DIRECT SPENDING \1\
CSRS Retirement Benefits for Part-Time
Service:
Estimated Budget Authority............ 4 10 14 18 21 24 26 28 30 31
Estimated Outlays..................... 4 10 14 18 21 24 26 28 30 31
Retirement Benefits for Service Academy
Credits:
Estimated Budget Authority............ 0 * 1 2 2 3 4 5 5 6
Estimated Outlays..................... 0 * 1 2 2 3 4 5 5 6
Refunds of Payments Made to CSRDF:
Estimated Budget Authority............ 0 -1 0 0 0 0 0 0 0 0
Estimated Outlays..................... 0 -1 0 0 0 0 0 0 0 0
Total Changes:
Estimated Budget Authority............ 4 9 15 20 23 27 30 33 35 37
Estimated Outlays..................... 4 9 15 20 23 27 30 33 35 37
CHANGES IN SPENDING SUBJECT TO APPROPRIATION
Enhanced Recruitment, Relocation, and
Retention Bonuses:
Estimated Authorization Level......... 67 69 70 72 74 76 79 81 83 86
Estimated Outlays..................... 66 69 70 72 74 76 79 81 83 86
----------------------------------------------------------------------------------------------------------------
\1\ The bill also would increase revenues, but by less than $500,000 a year, beginning in 2005.
Notes.--CSRS = Civil Service Retirement System; CSRDF = Civil Service Retirement and Disability Fund. * = less
than $500,000.
Basis of estimate: For this estimate, CBO assumes that S.
129 will be enacted early in 2004.
Direct spending and revenues
Civil Service Retirement Benefits for Part-Time Service.
Section 103 would alter the way retirement benefits under the
Civil Service Retirement System (CSRS) are calculated
forworkers with part-time service. The bill would apply to workers who
performed work prior to April 7, 1986, have some part-time service, and
retire after the bill is enacted. Based on information from Office of
Personnel Management (OPM), CBO estimates that this provision would
cost $4 million in 2004, $67 million over the 2004-2008 period, and
$206 million over the 2004-2013 period.
Under current law, benefits for CSRS workers with part-time
service are calculated using a two-step process. For workers
with service prior to April 7, 1986, the current formula uses
the highest salary the worker actually earned to reflect the
part-time employment. For work on or after April 7, 1986, the
formula uses a deemed salary (what the worker would have been
earning if the worker had been working full time) to determine
benefits and applies a pro-rata factor to adjust for part-time
service. In effect, the current formula tends to treat new
retirees with part-time service early in their careers more
favorably than those whose part-time service comes at the end
of their careers.
Section 103 would calculate CSRS benefits for all part-time
service according to the formula currently used to determine
benefits for service performed on or after April 7, 1986. The
legislation also contains a hold-harmless provision to ensure
that no one receives a smaller annuity under the proposal than
they would get under current law. CBO estimates section 103
would affect benefits for several thousand new CSRS retirees
each year. Depending on an individual employee's work history,
benefits for those retirees could be more than 30 percent
higher than they would be if calculated under the current
formula.
Allow Time Spent at Service Academies to Be Creditable For
Civilian Retirement. Section 104 would continue to allow time
spent at any of the four U.S. military academies be considered
creditable service under CSRS and the Federal Employees'
Retirement System (FERS). These two pension programs, which
cover most civilian federal workers, allow time served as an
active-duty member of the U.S. armed forces to be used as
creditable service provided that it is not already being
credited toward military retirement benefits and a deposit to
purchase the credits is made to the Civil Service Retirement
and Disability fund (CSRDF). Virtually all civilian employees
who have performed military service and are not collecting
military retirement benefits choose to have their military
service credited toward their civilian pensions.
Although current law is silent about whether time spent at
a military service academy--typically four years--should be
treated as creditable military service under CSRS and FERS, OPM
historically has allowed such service to be credited. Following
several court rulings, however, OPM has indicated that it no
longer believes such treatment is permissible under the law. As
a result, at some point in the near future, time spent at
military academies will no longer be creditable under either
civilian retirement program. CBO assumes this change will take
place in early 2005.
Based on data from OPM and the Department of Defense, CBO
estimates that, of the current federal civilian workforce
(including Postal Service employees), approximately 2,200
employees or just less than 1 percent have graduated from a
U.S. service academy. Of the 120,000 federal employees who
begin collecting retirement benefits each year, we further
estimate that about 100 will have graduated from a service
academy. For those retiring with CSRS benefits, four years of
creditable service represents 8 percentage points of their
annuity. For those retiring under FERS, four years of service
represents between 4.0 percentage points and 4.4 percentage
points of their annuity. By allowing time spent at a service
academy to continue being used as creditable service under CSRS
and FERS, this bill would increase retirement benefits above
what they would be once OPM stops crediting such service. CBO
estimates this section of the bill would increase direct
spending on retirement benefits by less than $500,000 in2 005,
$5 million during the 2005-2008 period, and $28 million over
the 2005-2013 period.
In order to have military service credited toward civilian
retirement benefits, a deposit must be made by the employee
into the CSRDF. For those under the CSRS program, the deposit
equals 7 percent of the basic pay received while performing the
service, and under the FERS the deposit equals 3 percent of
basic pay. Once OPM stops crediting time spent at an academy as
military service, refunds will be made to employees who already
made such deposits. Under this legislation, those refunds would
not be made, which CBO estimates would reduce direct spending
by $1 million in 2005. By continuing to allow time spent at
academies to be purchased as creditable service, the bill would
also increase future deposits into the CSRDF. We estimate these
deposits would increase federal revenues by less than $500,000
annually over the 2005-2013 period.
Spending subject to appropriation
Recruitment, Relocation, and Retention Bonuses. Section 101
allows OPM to authorize agencies to pay enhanced recruitment
and relocation bonuses for new or existing career employees
(not political appointees). Unlike the current bonuses of 25
percent of basic pay, the enhanced bonuses could total up to 25
percent of annual basic pay for up to four consecutive years.
Current law provides for retention allowances of up to 25
percent of basic pay over the period of service. Section 101
allows OPM to authorize agencies to pay enhanced retention
bonuses to individual career employees (25 percent of basic
pay) or groups of employees (10 percent of basic pay). With a
waiver from OPM, all three of these bonuses could be further
increased to up to 50 percent of basic pay in a given year.
Unlike the current bonuses and allowances, these enhanced
bonuses can be paid in installments or in lump sums (or any
suitable combination) and require the employee to enter into a
written service agreement with the employing agency.
The cost of these enhanced bonuses depends on how
extensively the agencies use the new authorities, and that
information is not available. Based on information from OPM, in
2002 the existing authorities were used to pay bonuses totaling
$129 million to just under 20,000 new and existing employees
across the government. Granting the maximum allowable level of
enhanced bonuses to this number of employees could roughly
double to quadruple this cost over time. CBO assumes that
agencies paying recruitment bonuses would, on average, double
the amount of these bonuses they award to new employees, and
also would increase outlays for retention bonuses by one-
quarter. CBO estimates that this would result in a cost of $351
million over the 2004-2008 period and $756 million over the
2004-2013 period, assuming the appropriation of the necessary
funds.
SES Authority for White House Office of Administration.
Section 105 would allow the White House Office of
Administration (OA) to hire new (or convert existing) employees
to career Senior Executive Service (SES) positions. OA expects
to convert 11 existing employees from General Schedule (GS)
status to SES status, eventually resulting in higher pay and
bonuses for these individuals. The section also changes the pay
cap for non-SES employees of the Vice President, the White
House Office, the executive residence, the domestic policy
staff, and OA from $115,184 including locality pay (minimum for
a GS-16) to $124,783 including locality pay (maximum for a GS-
15). Relatively few of these employees are believed to be near
the cap, however. CBO estimates that the cost of these two
provisions would not be significant.
Agency Training. Section 201 would require each agency to
designate a training officer to coordinate and administer
training programs. In consultation with OPM, each agency would
establish a comprehensive management program to train employees
and develop managers. CBO expects that the new requirements
would not add significant costs because the requirements mostly
reflect current agency practices.
Intergovernmental and private-sector impact: S. 129
contains no intergovernmental or private-sector mandates as
defined in UMRA and would not affect the budgets of state,
local, or tribal governments.
Estimate prepared by: Federal Costs: Federal Employment
Recruitment Benefits: Geoffrey Gerhardt; Federal Employee Pay
and Bonuses: Ellen Hays; and Agency Training: Matthew Pickford.
Impact on State, Local, and Tribal Governments: Sarah Puro.
Impact on the Private Sector: Selena Caldera.
Estimate approved by: Peter H. Fontaine, Deputy Assistant
Director for Budget Analysis.
VI. Evaluation of Regulatory Impact
Pursuant to the requirements of paragraph 11(b) of rule
XXVI of the Standing Rules of the Senate, the Committee has
considered the regulatory impact of this bill. CBO states that
there are no intergovernmental or private-sector mandates as
defined in the Unfunded Mandates Reform Act and no costs on
state, local, or tribal governments. The legislation contains
no other regulatory impact.
VII. Changes to Existing Law
In compliance with paragraph 12 of rule XXVI of the
Standing Rules of the Senate, changes in existing law made by
the bill, as reported, are shown as follows (existing law
proposed to be omitted is enclosed in black brackets, new
matter is printed in italic and existing law, in which no
change is proposed, is shown in roman):
TITLE 3, UNITED STATES CODE
* * * * * * *
CHAPTER 2--OFFICE AND COMPENSATION OF PRESIDENT
* * * * * * *
Sec. 107. Domestic Policy Staff and Office of Administration; personnel
* * * * * * *
(2) In addition to any authority granted under paragraph
(1) of this subsection, the President (or his designee) is
authorized to employ individuals in the Office of
Administration in accordance with [section 3101] sections 3101
and 3132 of title 5 and provisions relating thereto. Any
individual so employed under the authority granted under such
section 3101 shall be subject to the limitation specified in
section 114 of this title.
(3) Any permanent Senior Executive Service position
established under paragraph (2) shall be a career reserved
position.
* * * * * * *
Sec. 114. General pay limitation
* * * * * * *
(a) Notwithstanding any provision of law, other than the
provisions of this chapter, no employee of the White House
Office, the Executive Residence at the White House, the
Domestic Policy Staff, or the Office of Administration, nor any
employee under the Vice President appointed under section 106
of this title, may be paid at a rate of basic pay in excess of
the [minimum rate of basic pay then currently paid for GS-16]
maximum rate of basic pay then currently paid for GS-15 of the
General Schedule of section 5332 of title 5.
(b) The limitation established in subsection (a) shall not
apply to an individual appointed under the authority in section
107(b)(2), in accordance with section 3132 of title 5.
* * * * * * *
TITLE 5, UNITED STATES CODE
* * * * * * *
CHAPTER 41--TRAINING
Sec.
4101. Definitions.
4102. Exceptions; Presidential authority.
4103. Establishment of training programs.
4104. Government facilities; use of.
4105. Non-Government facilities; use of.
(4106. Repealed.)
4107. Restriction on degree training.
4108. Employee agreements; service after training.
4109. Expenses of training.
4110. Expenses of attendance at meetings.
4111. Acceptance of contributions, awards, and other payments.
4112. Absorption of costs within funds available.
(4113. Repealed.)
(4114. Repealed.)
4115. Collection of training information.
4116. Training program assistance.
4117. Administration.
4118. Regulations.
4119. Training for employees under the Office of the Architect of the
Capitol and the Botanic Garden.
4120. Agency training officer.
4121. Specific training programs.
* * * * * * *
Sec. 4103. Establishment of training programs
* * * * * * *
(c) The head of each agency shall--
(1) evaluate each program or plan established,
operated, or maintained under subsection (a) with
respect to accomplishing specific performance plans and
strategic goals in performing the agency mission; and
(2) modify such program or plan to accomplish such
plans and goals.
* * * * * * *
Sec. 4120. Agency training officer
* * * * * * *
Each agency shall appoint or designate a training officer
who shall be responsible for developing, coordinating, and
administering training for the agency.
* * * * * * *
Sec. 4121. Specific training programs
* * * * * * *
In consultation with the Office of Personnel Management,
each head of an agency shall establish--
(1) a comprehensive management succession program to
provide training to employees to develop managers for
the agency; and
(2) a program to provide training to managers on
actions, options, and strategies a manager may use in--
(A) relating to employees with unacceptable
performances; and
(B) mentoring employees and improving
employee performance and productivity.
* * * * * * *
CHAPTER 53--PAY RATES AND SYSTEMS
Subchapter VII--Miscellaneous Provisions
* * * * * * *
Sec. 5377. Pay authority for critical positions
* * * * * * *
[(c) The Office of Management and Budget, in consultation
with the Office of Personnel Management, may, upon the request
of the head of an agency, grant authority to fix the rate of
basic pay for 1 or more positions in such agency in accordance
with this section.]
(c) The Office of Personnel Management, in consultation
with the Office of Management and Budget, may, upon the request
of the head of an agency, grant authority to fix the rate of
basic pay for 1 or more positions in such agency in accordance
with this section.
(d)(1) The rate of basic pay fixed under this section by an
agency head may not be less than the rate of basic pay
(including any comparability payments) which would then
otherwise be payable for the position involved if this section
had never been enacted.
(2) Basic pay may not be fixed under this section at a rate
greater than the rate payable for level I of the Executive
Schedule, except upon written approval of the President.
(e) The authority to fix the rate of basic pay under this
section for a position shall terminate--
(1) whenever the [Office of Management and Budget]
Office of Personnel Management determines (in
accordance with such procedures and subject to such
terms or conditions as such Office by regulation
prescribes) that 1 or more of the requirements of
subsection (b) are no longer met; or
(2) as of such date as such Office may otherwise
specify, except that termination under this paragraph
may not take effect before the authority has been
available for such position for at least 1 calendar
year.
[(f) The Office of Management and Budget may not authorize
the exercise of authority under this section with respect to
more than 800 positions at any time, of which not more than 30
may, at any such time, be positions the rate of basic pay for
which would otherwise be determined under subchapter II.]
[(g) The Office of Management and Budget shall consult with
the Office of Personnel Management before prescribing
regulations under this section or making any decision to grant
or terminate any authority under this section.]
(f) The Office of Personnel Management may not authorize
the exercise of authority under this section with respect to
more than 800 positions at any 1 time, of which not more than
30 may, at any such time, be positions the rate of basic pay
for which would otherwise be determined under subchapter II.
(g) The Office of Personnel Management shall consult with
the Office of Management and Budget before making any decision
to grant or terminate any authority under this section.
(h) [The Office of Management and Budget shall report to
the Committee on Post Office and Civil Service] The Office of
Personnel Management shall report to the Committee on
Government Reform of the House of Representatives and the
Committee on Governmental Affairs of the Senate each year, in
writing, on the operation of this section.
Each report under this subsection shall include--
(1) the number of positions, in the aggregate and by
agency, for which higher rates of pay were authorized
or paid under this section during any part of the
period covered by such report; and
(2) the name of each employee to whom a higher rate
of pay was paid under this section during any portion
of the period covered by such report, the rate on rates
paid under this section during such period, the dates
between which each such higher rate was paid, and the
rate or rates that would have been paid but for this
section.
* * * * * * *
CHAPTER 55--PAY ADMINISTRATION
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Subchapter V--Premium Pay
Sec.
5541. Definitions.
5542. Overtime rates; computation.
5543. Compensatory time off.
5544. Wage-board overtime and Sunday rates; computation.
5545. Night, standby, irregular, and hazardous duty differential.
5545a. Availability pay for criminal investigators.
5545b. Pay for firefighters.
5546. Pay for Sunday and holiday work.
5546a. Differential pay for certain employees of the Federal Aviation
Administration and the Department of Defense.
5547. Limitation on premium pay.
5548. Regulations.
5549. Effect on other statutes.
(5550. Repealed.)
5550a. Compensatory time off for religious observances.
5550b. Compensatory time off for travel.
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Sec. 5550b. Compensatory time off for travel
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(a) Notwithstanding section 5542(b)(2), each hour spent by
an employee in travel status away from the official duty
station of the employee, that is not otherwise compensable,
shall be treated as an hour of work or employment for purposes
of calculating compensatory time off.
(b) An employee who has any hours treated as hours of work
or employment for purposes of calculating compensatory time
under subsection (a), shall not be entitled to payment for any
such hours that are unused as compensatory time.
(c) Not later than 30 days after the date of enactment of
this section, the Office of Personnel Management shall
prescribe regulations to implement this section.
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CHAPTER 57--TRAVEL, TRANSPORTATION, AND SUBSISTENCE
Subchapter I--Travel and Subsistence Expenses; Mileage Allowances
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Sec. 5754a. Retention allowances
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(a) In this section, the term ``employee'' has the meaning
given that term under section 2105, except that such term also
includes an employee described under subsection (c) of that
section.
(b)(1) The Office of Personnel Management may authorize the
head of an agency to pay a bonus to an individual appointed or
moved to a position that is likely to be difficult to fill in
the absence of such a bonus, if the individual--
(A)(i) is newly appointed as an employee of the
Federal Government; or
(ii) is currently employed by the Federal Government
and moves to a new position in the same geographic area
under circumstances described in regulations of the
Office; or
(B) is currently employed by the Federal Government
and must relocate to accept a position stationed in a
different geographic area.
(2) Except as provided by subsection (h), a bonus may be
paid under this section only to an employee covered by the
General Schedule pay system established under subchapter III of
chapter 53.
(c)(1) Payment of a bonus under this section shall be
contingent upon the employee entering into a written service
agreement to complete a period of employment with the agency,
not to exceed 4 years. The Office may, by regulation, prescribe
a minimum service.
(2)(A) The agreement shall include--
(i) the length of the required service period;
(ii) the amount of the bonus;
(iii) the method of payment; and
(iv) other terms and conditions under which the bonus
is payable, subject to subsections (d) and (e) and
regulations of the Office.
(B) The terms and conditions for paying a bonus, as
specified in the service agreement, shall include--
(i) the conditions under which the agreement may be
terminated before the agreed-upon service period has
been completed; and
(ii) the effect of the termination.
(3) The agreement shall be made effective upon employment
with the agency or movement to a new position or geographic
area, as applicable, except that a service agreement with
respect to a recruitment bonus may be made effective at a later
date under circumstances described in regulations of the
Office, such as when there is an initial period of formal basic
training.
(d)(1) Except as provided in subsection (e), a bonus under
this section shall not exceed 25 percent of the annual rate of
basic pay of the employee at the beginning of the service
period multiplied by the number of years (or fractions thereof)
in the service period, not to exceed 4 years.
(2) A bonus under this section may be paid as an initial
lump sum, in installments, as a final lump sum upon the
completion of the full service period, or in a combination of
these forms of payment.
(3) A bonus under this section is not part of the basic pay
of an employee for any purpose.
(4) Under regulations of the Office, a recruitment bonus
under this section may be paid to an eligible individual before
that individual enters on duty.
(e) The Office may authorize the head of an agency to waive
the limitation under subsection (d)(1) based on a critical
agency need, subject to regulations prescribed by the Office.
Under such a waiver, the amount of the bonus may be up to 50
percent of the employee's annual rate of basic pay at the
beginning of the service period multiplied by the number of
years (or fractions thereof) in the service period, not to
exceed 100 percent of the employee's annual rate of basic pay
at the beginning of the service period.
(f) The Office shall require that, before paying a bonus
under this section, an agency shall establish a plan for paying
recruitment bonuses and a plan for paying relocation bonuses,
subject to regulations prescribed by the Office.
(g) The Office may prescribe regulations to carry out this
section, including regulations relating to the repayment of a
recruitment or relocation bonus in appropriate circumstances
when the agreed-upon service period has not been completed.
(h)(1) At the request of the head of an Executive agency,
the Office may extend coverage under this section to categories
of employees within the agency who otherwise would not be
covered by this section.
(2) A bonus may not be paid under this section to an
individual who is appointed to, or who holds--
(A) a position to which an individual is appointed by
the President, by and with the advice and consent of
the Senate
(B) a position in the Senior Executive Service as a
noncareer appointee (as such term is defined under
section 3132(a)); or
(C) a position which has been excepted from the
competitive service by reason of its confidential,
policy-determining, policy-making, or policy-advocating
character.
(i)(1) The Office of Personnel Management shall submit an
annual report on bonuses paid under this section to the
Committee on Governmental Affairs of the Senate and the
Committee on Government Reform of the House of Representatives.
(2) Each report submitted under this subsection shall
include the use by each agency of recruitment and relocation
bonuses, including, with respect to each agency and each type
of bonus, the number and amount of bonuses by grade (including
the General Schedule, the Senior Executive Service, and
positions on the Executive Schedule).
(j)(1) An individual may not be paid a recruitment bonus
under this section and a recruitment bonus under section 5753.
(2) An individual may not be paid a relocation bonus under
this section and a recruitment bonus under section 5753.
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Sec. 5754b. Retention bonuses
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(a) In this section, the term `employee' has the meaning
given that term under section 2105, except that such term also
includes an employee described in subsection (c) of that
section.
(b) The Office of Personnel Management may authorize the
head of an agency to pay a retention bonus to an employee,
subject to regulations prescribed by the Office, if--
(1) the unusually high or unique qualifications of
the employee or a special need of the agency for the
employee's services makes it essential to retain the
employee; and
(2) the agency determines that, in the absence of a
retention bonus, the employee would be likely to
leave--
(A) the Federal service; or
(B) for a different position in the Federal
service under conditions described in
regulations of the Office.
(c) The Office may authorize the head of an agency to pay
retention bonuses to a group of employees in 1 or more
categories of positions in 1 or more geographic areas, subject
to the requirements of subsection (b)(1) and regulations
prescribed by the Office, if there is a high risk that a
significant portion of employees in the group would be likely
to leave in the absence of retention bonuses.
(d) Except as provided in subsection (j), a bonus may be
paid only to an employee covered by the General Schedule pay
system established under subchapter III of chapter 53.
(e)(1) Payment of a retention bonus is contingent upon the
employee entering into a written service agreement with the
agency to complete a period of employment with the agency.
(2)(A) The agreement shall include--
(i) the length of the required service period;
(ii) the amount of the bonus;
(iii) the method of payment; and
(iv) other terms and conditions under which the bonus
is payable, subject to subsections (f) and (g) and
regulations of the Office.
(B) The terms and conditions for paying a bonus, as
specified in the service agreement, shall include--
(i) the conditions under which the agreement may be
terminated before the agreed-upon service period has
been completed; and
(ii) the effect of the termination.
(3)(A) Notwithstanding paragraph (1), a written service
agreement is not required if the agency pays a retention bonus
in biweekly installments and sets the installment payment at
the full bonus percentage rate established for the employee
with no portion of the bonus deferred.
(B) If an agency pays a retention bonus in accordance with
subparagraph (A) and makes a determination to terminate the
payments, the agency shall provide written notice to the
employee of that determination. Except as provided in
regulations of the Office, the employee shall continue to be
paid the retention bonus through the end of the pay period in
which such written notice is provided.
(4) A retention bonus for an employee may not be based on
any period of such service which is the basis for a recruitment
or relocation bonus under section 5753.
(f)(1) Except as provided in subsection (g), a retention
bonus, which shall be stated as a percentage of the employee's
basic pay for the service period associated with the bonus, may
not exceed--
(A) 25 percent of the employee's basic pay if paid
under subsection (b); or
(B) 10 percent of an employee's basic pay if paid
under subsection (c).
(2) A retention bonus may be paid to an employee in
installments after completion of specified periods of service
or in a single lump sum at the end of the full period of
service required by the agreement. An installment payment may
not exceed the product derived from multiplying the amount of
basic pay earned in the installment period by a percentage not
to exceed the bonus percentage rate established for the
employee. If the installment payment percentage is less than
the bonus percentage rate, the accrued but unpaid portion of
the bonus is payable as part of the final installment payment
to the employee after completion of the full service period
under the terms of the service agreement.
(3) A retention bonus is not part of the basic pay of an
employee for any purpose.
(g) Upon the request of the head of an agency, the Office
may waive the limit established under subsection (f)(1) and
permit the agency head to pay an otherwise eligible employee or
category of employees retention bonuses of up to 50 percent of
basic pay, based on a critical agency need.
(h) The Office shall require that, before paying a bonus
under this section, an agency shall establish a plan for paying
retention bonuses, subject to regulations prescribed by the
Office.
(i) The Office may prescribe regulations to carry out this
section.
(j)(1) At the request of the head of an Executive agency,
the Office may extend coverage under this section to categories
of employees within the agency who otherwise would not be
covered by this section.
(2) A bonus may not be paid under this section to an
individual who is appointed to, or who holds--
(A) a position to which an individual is appointed by
the President, by and with the advice and consent of
the Senate
(B) a position in the Senior Executive Service as a
noncareer appointee (as such term is defined under
section 3132(a)); or
(C) a position which has been excepted from the
competitive service by reason of its confidential,
policy-determining, policy-making, or policy-advocating
character.
(k)(1) The Office of Personnel Management shall submit an
annual report on bonuses paid under this section to the
Committee on Governmental Affairs of the Senate and the
Committee on Government Reform of the House of Representatives.
(2) Each report submitted under this subsection shall
include the use by each agency of recruitment and relocation
bonuses, including, with respect to each agency and each type
of bonus, the number and amount of bonuses by grad (including
the General Schedule, the Senior Executive Service, and
positions on the Executive Schedule).
(l) An individual may not be paid a retention bonus under
this section and a recruitment allowance under section 5754.
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CHAPTER 63--LEAVE
Subchapter I--Annual and Sick Leave
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Sec. 6303. Annual leave; accrual
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(a) An employee is entitled to annual leave with pay which
accrues as follows--
(1) one-half day for each full biweekly pay period
for an employee with less than 3 years of service;
(2) three-fourths day for each full biweekly pay
period, except that the accrual for the last full
biweekly pay period in the year is one and one-fourth
days, for an employee with 3 but less than 15 years of
service; [and]
(3) one day for each full biweekly pay period for an
employee with 15 or more years of service[.]; and
(4) one day for each full biweekly pay period for an
employee in a position paid under section 5376 or 5383,
or for an employee in an equivalent category for which
the minimum rate of basic pay is greater than the rate
payable at GS-15, step 10.
In determining years of service, an employee is entitled to
credit for all service of a type that would be creditable under
section 8332, regardless of whether or not the employee is
covered by subchapter III of chapter 83. However, an employee
who is a retired member of a uniformed service as defined by
section 3501 of this title is entitled to credit for active
military service only if--
(A) his retirement was based on disability--
(i) resulting from injury or disease received
in line of duty as a direct result of armed
conflict; or
(ii) caused by an instrumentality of war and
incurred in line of duty during a period of war
as defined by sections 101 and 1101 of title
38;
(B) that service was performed in the armed forces
during a war, or in a campaign or expedition for which
a campaign badge has been authorized; or
(C) on November 30, 1964, he was employed in a
position to which this subchapter applies and
thereafter he continued to be so employed without a
break in service of more than 30 days.
The determination of years of service may be made on the
basis of an affidavit of the employee. Leave provided by this
subchapter accrues to an employee who is not paid on the basis
of biweekly pay periods on the same basis as it would accrue if
the employee were paid on the basis of biweekly pay periods.
(b) Notwithstanding subsection (a) of this section, an
employee whose current employment is limited to less than 90
days is entitled to annual leave under this subchapter only
after being currently employed for a continuous period of 90
days under successive appointments without a break in service.
After completing the 90-day period, the employee is entitled to
be credited with the leave that would have accrued to him under
subsection (a) of this section except for this subsection.
(c) A change in the rate of accrual of annual leave by an
employee under this section takes effect at the beginning of
the pay period after the pay period, or corresponding period
for an employee who is not paid on the basis of biweekly pay
periods, in which the employee completed the prescribed period
of service.
(d) Leave granted under this subchapter is exclusive of
time actually and necessarily occupied in going to or from a
post of duty and time necessarily occupied awaiting
transportation, in the case of an employee--
(1) to whom section 6304(b) of this title applies;
(2) whose post of duty is outside the United States;
and
(3) who returns on leave to the United States, or to
his place of residence, which is outside the area of
employment, in its territories or possessions including
the Commonwealth of Puerto Rico.
This subsection does not apply to more than one period of
leave in a prescribed tour of duty at a post outside the United
States.
(e)(1) In this subsection, the term ``period of qualified
non-Federal career experience'' means any equal period of
service performed by an individual that--
(A) except for this subsection would not otherwise be
service performed by an employee for purposes of
subsection (a); and
(B) was performed in a position--
(i) the duties of which were directly related
to the duties of the position in an agency that
such individual holds; and
(ii) which meets such other conditions as the
Office of Personnel Management shall prescribe
by regulation.
(2) For purposes of subsection (a), the head of an agency
may deem a period of qualified non-Federal career experience
performed by an individual to be a period of service performed
as an employee.
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CHAPTER 83--RETIREMENT
Subchapter III--Civil Service Retirement
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Sec. 8331. Definitions
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(13) ``military service'' means honorable active
service--
(A) in the armed forces;
(B) in the Regular or Reserve Corps of the
Public Health Service after June 30, 1960; or
(C) as a commissioned officer of the
Environmental Science Services Administration
after June 30, 1961;
[but] and includes service as a cadet at the United
States Military Academy, the United States Air Force
Academy, or the United States Coast Guard Academy, or
as a midshipman at the United States Naval Academy, but
does not include service in the National Guard except
when ordered to active duty in the service of the
United States or full-time National Guard duty (as such
term is defined in section 101(d) of title 10) if such
service interrupts creditable civilian service under
thissubchapter and is followed by reemployment in
accordance with chapter 43 of title 38 that occurs on or after August
1, 1990;
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Sec. 8339. Deferred retirement
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(p)(1) In computing an annuity under this subchapter for an
employee whose service includes service that was performed on a
part-time basis--
(A) the average pay of the employee, to the extent
that it includes pay for service performed in any
position on a part-time basis, shall be determined by
using the annual rate of basic pay that would be
payable for full-time service in the position; and
(B) the benefit so computed shall then be multiplied
by a fraction equal to the ratio which the employee's
actual service, as determined by prorating an
employee's total service to reflect the service that
was performed on a part-time basis, bears to the total
service that would be creditable for the employee if
all of the service had been performed on a full-time
basis.
(2) For the purpose of this subsection, employment on a
part-time basis shall not be considered to include employment
on a temporary or intermittent basis.
(3) In the administration of paragraph (1)--
(A) subparagraph (A) of such paragraph shall apply to
any service performed before, on, or after April 7,
1986;
(B) subparagraph (B) of such paragraph shall apply to
all service performed on part-time or full-time basis
on or after April 7, 1986; and
(C) any service performed on a part-time basis before
April 7, 1986, shall be credited as service performed
on a full-time basis.
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CHAPTER 84--FEDERAL EMPLOYEES' RETIREMENT SYSTEM
Subchapter I--General Provisions
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Sec. 8401. Definitions
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(31) the term ``military service'' means honorable
active service--
(A) in the armed forces;
(B) in the commissioned corps of the Public
Health Service after June 30, 1960; or
(C) in the commissioned corps of the National
Oceanic and Atmospheric Administration, or a
predecessor entity in function, after June 30,
1961;
[but] and includes service as a cadet at the United
States Military Academy, the United States Air Force
Academy, or the United States Coast Guard Academy, or
as a midshipman at the United States Naval Academy, but
does not include service in the National Guard except
when ordered to active duty in the service of the
United States or full-time National Guard duty (as such
term is defined in section 101(d) of title 10) if such
service interrupts creditable civilian service under
this subchapter and is followed by reemployment in
accordance with chapter 43 of title 38 that occurs on
or after August 1, 1990;
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