[Federal Register Volume 62, Number 226 (Monday, November 24, 1997)]
[Rules and Regulations]
[Pages 62495-62504]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 97-30428]



 ========================================================================
 Rules and Regulations
                                                 Federal Register
 ________________________________________________________________________
 
 This section of the FEDERAL REGISTER contains regulatory documents 
 having general applicability and legal effect, most of which are keyed 
 to and codified in the Code of Federal Regulations, which is published 
 under 50 titles pursuant to 44 U.S.C. 1510.
 
 The Code of Federal Regulations is sold by the Superintendent of Documents. 
 Prices of new books are listed in the first FEDERAL REGISTER issue of each 
 week.
 
 ========================================================================
 

  Federal Register / Vol. 62, No. 226 / Monday, November 24, 1997 / 
Rules and Regulations  

[[Page 62495]]


=======================================================================
-----------------------------------------------------------------------

OFFICE OF PERSONNEL MANAGEMENT

5 CFR Parts 351, 430, and 531

RIN 3206-AH32


Reduction in Force and Performance Management

AGENCY: Office of Personnel Management.

ACTION: Final rule.

-----------------------------------------------------------------------

SUMMARY: The Office of Personnel Management (OPM) is issuing final 
regulations that enhance the opportunity for Federal employees to 
receive reduction in force retention service credit based on their 
actual job performance. The regulations also give agencies with 
employees who have been rated under different patterns of summary 
rating levels a mechanism to take this into account when providing 
employees additional retention service credit for reduction in force. 
These regulations also clarify certain other retention rights, 
including the coverage of employees serving under term appointments.

DATES: Effective date: December 24, 1997. Compliance dates: Subject to 
the requirements of 5 U.S.C. 7116(a)(7), agencies may implement revised 
Secs. 351.504 and 351.803(a), at any time between December 24, 1997 and 
October 1, 1998. For reduction in force actions effective between 
December 24, 1997 and September 30, 1998, agencies may use either 
Secs. 351.504 and 351.803(a) effective December 24, 1997 or the prior 
Secs. 351.504 and 351.803(a) in 5 CFR part 351 (January 1, 1997, 
edition).

FOR FURTHER INFORMATION CONTACT: Thomas A. Glennon, Jacqueline Yeatman, 
or Edward P. McHugh (part 351); (202) 606-0960, FAX (202) 606-2329; or 
Barbara Colchao or Doris Hausser (parts 430 and 531); (202) 606-2720, 
FAX (202) 606-2395.

SUPPLEMENTARY INFORMATION: On February 4, 1997, OPM issued proposed 
regulations concerning reduction in force and performance management. 
These proposed changes were designed to enhance the opportunity for 
Federal employees to receive reduction in force retention credit based 
on their actual job performance. They proposed changes to the crediting 
procedures used when employees are missing performance ratings, as well 
as giving agencies the authority to vary performance credit in 
reduction in force to take into account ratings given under different 
summary level patterns.
    We received comments from 21 agencies, 4 unions, and 3 individuals. 
Not every commenter mentioned every proposed provision. The key changes 
OPM proposed in the regulations are summarized below, along with a 
summary of the comments received on that particular proposal.

Providing Retention Service Credit When Employees in the Same Reduction 
in Force Competitive Area Have Been Rated Under More Than One Pattern 
of Summary Rating Levels

    On August 23, 1995, OPM issued final regulations, at 60 FR 43936, 
giving agencies the option to determine which of eight permissible 
patterns of summary rating levels to use for their performance 
appraisal programs. As a result, changes in the crediting of 
performance in reduction in force were necessary because this 
flexibility in the design of performance appraisal programs can affect 
employees' relative retention standing for reduction in force. The 
proposed regulations revised 5 CFR 351.504 to require an agency to take 
into account different patterns of summary rating levels when providing 
employees additional retention service credit in reduction in force 
competition based on their performance.
    Under the proposed regulations, an agency with employees in a 
reduction in force competitive area who have been rated under different 
patterns of summary rating levels must decide how many years of 
retention service credit within the allowable range of 12 to 20 years 
to assign to particular summary rating levels in their patterns. The 
specific method selected by the agency to provide retention service 
credit for performance will of necessity be specific to the reduction 
in force competitive area as the agency takes into account the 
combination of rating patterns used and the relative numbers of 
employees rated under each pattern.
    If an agency has reduction in force competitive areas in which all 
employee ratings of record to be credited were given under the same 
pattern of summary levels, it is required to follow the current 
regulations for crediting performance in a reduction in force which now 
appear in paragraph (d) of section 351.504.
    In applying the proposed regulations, agencies must treat employees 
within the reduction in force competitive area in a uniform and 
consistent manner. An agency carrying out a reduction in force may 
provide different amounts of additional retention service credit for 
ratings of record received in an employee's former agency than were 
provided by that former organization.
    The majority of comments received on this proposal were very 
positive. Most of those who commented felt it was a necessary and 
logical outgrowth of performance rating flexibility that would be 
helpful to both agencies and employees. This proposal was especially 
well-received by those considering, or already using, alternative 
performance appraisal programs such as a 2-level (``Pass/Fail'') 
program. Some agencies requested even greater flexibility to address 
what they see as potential inequities when employees in different 
competitive areas are rated under different appraisal programs, even if 
there is no inconsistency within each competitive area. This was deemed 
especially crucial to agencies having various offices or components 
using different summary rating patterns.
    One commenter voiced the concern that employees rated as ``Fully 
Successful'' under a two-level program could actually be performing at 
very different levels. Another suggested that the proposal be modified 
in order to prevent an agency from giving less credit to an employee's 
ratings of record from their previous agency than to the agency's 
``own'' ratings. Several other commenters suggested that specific 
mandates be established on how this flexibility is to be used.
    OPM has carefully considered these suggestions and decided not to 
adopt them. We believe that many of these concerns are rooted in 
decisions about

[[Page 62496]]

using various types of performance appraisal programs in the first 
place, and most would be addressed by the requirement to provide 
uniformity and consistency within each competitive area. For example, 
an agency assigning 16 years of credit to a ``fully successful'' rating 
of record earned under a two-level program must give ALL employees who 
earned a ``fully successful'' rating of record in a two-level program 
this credit, no matter what agency or organization actually issued the 
rating. Granting additional flexibility, by definition, allows for 
decision-making that some may disagree with. Alternatively, an agency 
is free to choose a crediting system that mirrors the current 12/16/20 
year pattern required for use in single-rating-pattern situations (they 
are required to examine the situation when multiple rating patterns 
exist, but there is no requirement to adopt any particular crediting 
method). In addition, agencies concerned about consistency are free to 
establish their own agencywide policies on how this flexibility will be 
used.
    One commenter suggested that no additional credit beyond 12 years 
be provided for performance above the level of ``Fully Successful''. We 
have not adopted this suggestion since it goes beyond the scope of the 
proposal and because the new regulations would give agencies the 
flexibility to assign credit in this way if they choose, as long as 
ratings of record are assigned under more than one summary pattern in 
the competitive area.

Extending the ``look-back'' period to 6 years

    This element of the proposal addressed the circumstance where 
employees have received fewer than three actual ratings of record in 
the last 4 years, which could occur due to a variety of circumstances. 
Current regulations require the substitution of an assumed rating of 
``Fully Successful'' for each missing rating of record. To minimize the 
use of assumed ratings and to maximize the extent to which additional 
retention service credit is based on actual job performance, OPM 
proposed to lengthen the period of time from which ratings of record 
are taken into account from 4 years to 6 years prior to the reduction 
in force. This change would have been phased in to allow agencies time 
to change their recordkeeping procedures.
    Several of those who commented supported this proposal, believing 
that the potential for increasing the use of actual performance 
appraisals earned by employees outweighed the additional record-keeping 
requirements it would impose on agencies. Some even suggested that we 
modify the proposal to allow agencies to go back longer than 6 years 
when necessary. However, the majority of commenters disagreed with the 
proposed lengthening of the ``look-back'' period from 4 years to 6 
years, even with the phase-in provisions. The objections centered on 
the view that a 6-year-old appraisal is too dated to serve as an 
accurate indicator of current employee performance, and that allowing 
older appraisals to be used in reduction in force might discourage 
supervisors from preparing current appraisals when required. Some were 
also concerned that these additional administrative requirements were 
unduly burdensome, especially in light of the current emphasis on 
simplification, paperwork reduction, and streamlining. We have 
considered these comments, as well as the possibility of providing 
agencies with flexibility to determine what the length of their ``look-
back'' period should be for specific reductions in force. We concluded 
that the significant additional administrative requirements resulting 
from a 6-year ``look-back'' do not justify the results, especially 
since the other changes provided for in this regulatory package would 
significantly reduce the number of assumed ratings. For these reasons, 
we concluded that the current ``look-back'' period of 4 years should be 
retained.

Averaging actual ratings received if fewer than three

    To further enhance the use of actual performance in determining 
reduction in force service credit, OPM proposed to remove the 
requirement to fill in missing ratings of record with assumed ``fully 
successful'' ratings when an employee has received only one or two 
actual ratings of record. Under the proposal, the actual rating(s) of 
record available would serve as the sole basis of the employee's 
credit, and no assumed ratings would be used. Consequently, if an 
employee has received only two actual ratings of record during this 
period, the value assigned to each rating would be added together and 
divided by two to determine the amount of additional retention service 
credit.
    Among those who commented on this proposal, there was an almost 
equal number of those who supported it and those who did not. Most of 
those opposing the proposed change cited the greater weight that would 
necessarily be placed on the one or two actual ratings of record 
received. One commenter was concerned that supervisors would be less 
likely to complete ratings of record as a result of this proposal. A 
number of commenters, however, supported this proposal because it 
simplifies the process and allows an employee's actual demonstrated 
performance to take the place of an artificially prescribed level of 
credit (assumed ``Fully Successful''). In considering the comments 
received on this issue, we were persuaded that this change would serve 
to simplify the procedure and would increase the emphasis on actual 
performance, a stated goal of the proposed regulations. Therefore, we 
are adopting this proposal in the final regulations.

Crediting performance for employees with no actual ratings

    OPM had proposed two methods of providing performance credit for 
reduction in force in cases where an employee would have no actual 
ratings of record at all. Under the proposed regulations, an employee 
with at least one year of current continuous service would be given the 
additional retention service credit for the most common, or ``modal'', 
summary rating level, as defined in 5 CFR 351.203, for the summary 
level pattern that applies to the employee's position at the time of 
the reduction in force. The proposal would allow agencies to determine 
the modal rating using ratings of record in the competitive area, in a 
larger subdivision of the agency, or agencywide, as long as the 
applicable modal rating(s) was applied uniformly and consistently 
within the competitive area to all employees with no ratings of record.
    Under the proposal, the modal rating would not be used for 
employees who have completed less than one year of current continuous 
service. Instead, additional retention service credit would be given 
based on a Level 3 (Fully Successful or equivalent) rating of record 
under the summary level pattern that applies to the employee's position 
at the time of reduction in force.
    Those who commented negatively on this proposal disliked the idea 
of using a modal rating because it did not represent performance 
actually demonstrated by the employee. Some felt the use of a modal 
rating was arbitrary and unfair, and potentially vulnerable to appeal 
or other challenge, while others saw it as more fair to employees than 
an assumed ``fully successful'' rating that now falls below the 
Governmentwide average rating. Several agencies were also concerned 
with how this requirement would be incorporated into existing automated 
systems.

[[Page 62497]]

    One commenter suggested that the regulations be revised to require 
that all employees with at least one year of service must have a rating 
of record before a reduction in force can be conducted. We have not 
adopted this suggestion because we feel it is impossible to require a 
rating of record in all circumstances, given the various rating cycle 
dates and other circumstances that can occur.
    One of those who commented suggested that employees who have 
received no ratings of record should receive no performance credit for 
reduction in force. We have not adopted this suggestion because we 
believe it unfairly and severely penalizes an employee who has no 
ratings of record due to factors completely outside his/her control. We 
believe that some reasonable and fair method of constructing 
performance credit is necessary to deal with these circumstances.
    It is important to note that the modal rating would only be used in 
cases where the employee has no ratings of record of his/her own to 
credit. Since no rating of record exists, some form of ``assumed'' 
rating is the only recourse available. Because the modal rating is the 
summary level that was given most often to employees in the 
organization conducting the reduction in force, we believe it is the 
best way to assign credit with the least disadvantage to an individual 
employee who has no rating of record reflecting his/her actual 
performance.
    Much of the opposition to the modal rating proposal focused on the 
complexity for personnelists in administering two different types of 
formulae based on length of service (less than one year means use 
assumed ``Fully Successful'; more than one year requires tabulation of 
modal rating). Some saw this as contradictory to ongoing simplification 
initiatives. In addition, several commenters pointed out that this 
distinction could result in an employee with 364 days of service being 
treated differently (in terms of performance credit for reduction in 
force) than another employee with 366 days of service. We agree that 
the distinction based on length of service adds greater complexity to 
the process, and we have therefore eliminated this distinction in the 
final regulations. Instead, the modal rating will be used to grant 
performance credit in reduction in force for all employees who have no 
ratings of record. We feel this better supports the principles of 
uniformity and consistency in the reduction in force treatment of 
employees.
    Several commenters requested that OPM designate the basis used by 
agencies to determine their modal ratings (i.e., agencywide; agency 
subdivision; or competitive area). They also asked that agencies not be 
allowed to change this basis once it is selected without OPM and/or 
union approval. However, agencies have different data systems and not 
all will have a great deal of flexibility in terms of tabulating modal 
ratings. Some may only have agencywide performance appraisal data to 
work with. We felt that it was necessary to preserve this flexibility 
for determining the basis used for tabulating modal ratings to ensure 
that all agencies are able to implement this requirement. However, we 
would encourage agencies to consider making this determination in 
partnership with employees and their representatives.

Use of Non-430 Ratings in Reduction in Force

    OPM proposed language in the revised section 351.504 that would 
require agencies to use all ratings of record given to employees for 
assigning additional retention service credit during a reduction in 
force, including a performance evaluation given to an employee under an 
appraisal system not covered by the provisions of 5 CFR part 430, 
subpart B, if it meets the conditions specified in the new paragraph 
(c) of section 430.201.
    Those who commented in support of this proposal felt it was 
appropriate to give credit for such ratings in a reduction in force if 
they were equivalent to those given under part 430.
    One commenter disagreed with the proposal, believing it would be 
too difficult for agencies to establish the equivalent summary pattern 
and rating level for these non-430 ratings. We have considered this 
objection; however, we feel that agencies should be able to make these 
determinations with help from the agency that gave the rating and/or 
members of OPM's performance management staff.

Implementation Date Issues

(1) Performance in Retention Service Credit Determinations
    The new agency authority to determine retention service credit when 
employees in a competitive area are rated under multiple rating 
patterns described in Sec. 351.504(e) would apply only to ratings of 
record that are put on record, as defined in paragraph (b)(3) of 
Sec. 351.504, on or after October 1, 1997. The agency credits any 
ratings of record put on record on or before September 30, 1997, based 
on the Governmentwide 12-, 16-, and 20-year formula for additional 
retention service credit currently in effect.
    Agencies were divided on their preference for which ratings of 
record could be assigned credit using the new flexibility. While some 
wanted to be able to establish credit for ratings of record given since 
1995 (when performance management was deregulated), others wished to 
establish credit only for ratings of record given under cycles begun 
after October 1, 1997. OPM originally proposed that the flexibility 
would apply to ratings of record put on record on or after October 1, 
1997, and has decided to retain this provision in the final regulation.
    A related issue was the effective date of the regulations and its 
effect on the implementation of some of the provisions, particularly 
those affecting the flexible assignment of service credit and 
situations where fewer than three ratings of record are available. 
Concerns such as the lead time required for changes in the automation 
of RIF processing programs, and the need to meet collective bargaining 
requirements prior to the implementation of these regulations were also 
raised during the comment process. OPM originally proposed 
implementation on October 1, 1997. We have considered the suggestions 
received on this issue and have determined that overall fairness is 
best managed through giving agencies the flexibility to implement the 
provisions of Sections 351.504 (crediting performance) and 351.803 
(notice of eligibility for reemployment and other placement 
assistance), at any time between the effective date of these 
regulations and October 1, 1998. Agencies are required to apply the 
provisions used in a uniform and consistent manner to all employees in 
a given RIF competitive area.
    When crediting performance in a reduction in force, agencies would 
have the option to implement immediately as of the effective date of 
these regulations the provisions for establishing credit when ratings 
of record were given under mixed summary level patterns (351.504(e)) 
and the use of the modal value for missing ratings as well as averaging 
only actual ratings of record found during the 4-year ``look-back'' 
period (351.504(c)). At its discretion, an agency could decide to delay 
implementation of these provisions until no later than October 1, 1998, 
and continue to use the performance crediting provisions in the current 
Sec. 351.504 (i.e., those in effect on January 1, 1997).

[[Page 62498]]

    The effect of the provisions in paragraphs 351.504 (b) and (d) 
remain unchanged by the new regulations. When applying paragraph 
351.504(a), the context created by the new definition for rating of 
record and other regulatory changes will permit the use of non-430 
ratings under the conditions specified even when an agency is using the 
older version of 5 CFR 351.504.
    This gives agencies able to proceed immediately the opportunity to 
do so, without forcing others that need time to complete more extensive 
preparations into an unrealistic time frame. However, for reduction in 
force actions effective after September 30, 1998, the new provisions 
for crediting mixed-pattern ratings of record and handling situations 
where ratings are missing must be applied by all agencies.
(2) Implementation of Provisions During Ongoing Reductions
    Several commenters mentioned their concern that ongoing reductions 
in force would be disrupted by the requirement to implement these 
provisions. Revising the procedures for handling missing ratings of 
record and crediting performance under multiple rating patterns could 
result in changed reduction in force outcomes, new notices, and 
additional delays due to notice period requirements. We agree that this 
would prove unnecessarily disruptive to both agencies and employees. 
However, we believe that giving agencies the option to implement the 
provisions of sections 351.504 and 351.803 at any time up until October 
1, 1998, will allow them to take into account any upcoming reduction in 
force activity and plan accordingly.

Technical Amendments

    OPM proposed a number of technical changes in parts 351, 430 and 
531, which served to clarify existing regulations in various areas. 
These included redefinition of rating of record under part 351 to refer 
to the part 430 definition, provisions for handling employees with a 
written notice of pending action under part 752 similarly to those with 
action pending under part 432, changes to the critical element 
definition, barring non-critical elements in two-level appraisals, and 
clarifications of: appraisal period, acceptable level of competence 
determinations, competitive area, competitive level, procedures for 
determining grade intervals for assignment, expiration and amendment of 
reduction in force notices, assignment rights optionally provided to 
excepted service employees, and coverage of term employees under 
retention subgroups.
    We received comments on some of these proposed clarifications. One 
suggested rewording of the definition of rating of record to better 
reflect that this rating belongs to the employee rather than the 
agency. We agree and have adopted this suggestion.
    Several commenters asked what date should be used as the effective 
date of a rating of record. Perhaps contributing to their confusion are 
changes to the way ratings of record are reported to the Central 
Personnel Data File. While a rating of record is a personnel action, 
OPM no longer requires that it be reported separately with its own 
distinct nature of action code (009). Rating of record information is 
now transmitted to OPM via other standard reporting procedures. When a 
separate nature of action code was used, the previous reporting 
procedures specified that the effective date for a rating of record was 
the ending date of the appraisal period to which the rating applied. 
The new procedures capture this same information as an isolated data 
element and eliminate the need for separate processing of many 
thousands of actions. It is OPM's view that the ending date of the 
applicable appraisal period is the effective date of the rating of 
record, and this date should be used to determine whether or not a 
rating of record falls within the 4-year ``look-back'' period.
    Section 5 CFR 351.402(b) clarifies OPM's longstanding policy on the 
minimum standard for a reduction in force competitive area. All of the 
comments on this proposed revision supported the change, and the 
proposed regulation is adopted without further modification.
    To conduct a reduction in force, section 5 CFR 351.402(a) provides 
that the agency must establish the applicable competitive area that is 
the boundary within which employees compete for retention under 
reduction in force procedures.
    Section 5 CFR 351.402(b) provides that employees in a competitive 
area compete for retention under OPM's reduction in force regulations 
only with other employees in the same competitive area. Employees do 
not compete for retention with employees of the agency in another 
competitive area.
    Section 5 CFR 351.402(b) provides that the agency must define each 
competitive area solely in terms of organizational unit and 
geographical location. The competitive area then includes all employees 
within the organizational unit and geographical location that is 
included in the competitive area definition. Each employee competes 
with all other employees in the competitive area for positions under 
OPM's retention regulations. There is no minimum or maximum number of 
employees in a competitive area. Also, in any one reduction in force, 
an agency may not use one competitive area for the first round of 
competition and a different competitive area for second rounds of 
competition.
    Section 5 CFR 351.402(b) clarifies that the minimum competitive 
area for any agency component is a subdivision of the agency within the 
local commuting area that is under separate administration. An agency 
may establish separate competitive areas for different components in 
the same local commuting area if each component is under separate 
administration, which includes that each is independent of the other in 
operation, work function, and staff.
    As used for purposes of establishing a minimum competitive area 
consistent with section 5 CFR 351.402(b), ``separate administration'' 
is the administrative authority to take or direct personnel actions 
(i.e., the authority to establish positions, abolish positions, assign 
duties, etc.) rather than the issuance or processing of the documents 
by which these decisions are effected. This separate administration is 
evidenced by the agency's organizational manual and delegations of 
authority that document where, in the organization, final authority 
rests to make these decisions. (The competitive area standard also 
recognizes that many agencies retain certain personnel-related actions 
such as classification authority or final approval of higher-graded 
positions to a central authority above the organizational standard 
required for a minimum competitive area).
    The same standard is used for a minimum competitive area in a local 
commuting area in both a headquarters organization or field component. 
Former references in 5 CFR 351.402(b) to organizational units that 
could comprise a minimum competitive area in a headquarters 
organization or field component were examples of where separate 
administration is often found in agencies. These references were 
deleted in final 5 CFR 351.402(b) to clarify that the same minimum 
competitive area standard is applicable whether the organizational unit 
is headquarters, a field activity, a duty station, or other applicable 
organization.
    Under 5 CFR 351.402(b), an agency may establish a competitive area 
that is larger than the minimum standard. However, a competitive area 
may not be smaller than the minimum standard.

[[Page 62499]]

    The fact that several activities may be serviced by the same 
personnel office does not, of itself, require that they be placed in 
the same competitive area. The personnel office merely processes 
personnel actions rather than having final responsibility to make 
decisions on whether to establish positions, abolish positions, assign 
duties, etc.
    Another commenter felt that the proposal did not go far enough in 
dealing with employees who have received written decisions under part 
752, and suggested that those employees be excluded from reduction in 
force competition altogether. There is, however, no basis in law to 
eliminate the right of these employees to remain in reduction in force 
competition until they are actually removed from Federal service. 
Therefore, this suggestion was not adopted.
    OPM had also proposed changes to the requirements for reduction in 
force separation notices to include an estimate of severance pay if 
applicable, and information on benefits available under new subparts F 
and G (Career Transition Assistance Programs) of part 330 of this 
chapter and from the applicable State dislocated worker unit(s), as 
designated or created under title III of the Job Training Partnership 
Act. To increase placement opportunities for employees affected by 
downsizing, the proposed section also required that agencies give 
employees receiving a reduction in force separation notice a release to 
authorize, at their option, the release of their resumes for employment 
referral to State dislocated worker unit(s) and potential public and 
private sector employers. OPM is developing material for this purpose.
    A few commenters were concerned that these requirements would place 
a greater burden on personnel offices and reduce the emphasis on 
employee empowerment that is central to successful career transition 
programs. One felt the role of obtaining authorization for release of 
resumes belonged solely with the placement coordinator, and that this 
did not belong with the reduction in force notice since placement 
efforts would already be well underway by the time reduction in force 
notices are issued.
    We agree that, ideally, placement efforts should begin long before 
reduction in force notices are issued. However, this is not always 
possible. We have considered these comments carefully and feel that 
providing a release that can be completed entirely at the employee's 
option remains within the spirit of empowerment and simply serves as 
another vehicle for coordination between Federal Government and other 
public and private employers that will hopefully aid employees in the 
transition process. Many agencies have personnel office staff who serve 
in dual roles, both conducting the reduction in force and assisting 
employees in placement. Since a reduction in force notice is issued to 
all employees being separated, it provides a unique opportunity for the 
agency to give employees career transition information and to ensure 
that all employees being separated will receive it. However, in 
recognition of the fact that agencies will need time to modify their 
reduction in force notices, we have made this provision one of those 
which may be implemented at any time between the effective date of 
these regulations and October 1, 1998. All notices issued on or after 
October 1, 1998, must meet the requirements of these regulations.
    One commenter was concerned that the severance pay estimate 
calculation might be open to challenge if it was later found to be in 
error. They suggested instead that agencies provide information on how 
to compute severance pay and let employees do the calculations 
themselves. We have not adopted this suggestion because we believe 
agency-developed severance pay estimates are much more likely to be 
accurate than those done by employees. Further, we would emphasize that 
agencies should clearly indicate that their severance pay calculations 
are merely estimates, as many agencies do now, but that employees are 
ultimately responsible for verifying these estimates.
    Several commenters suggested that we add a requirement that 
specific information on the employee's competitive level, including the 
names of employees in various levels, be added to the notice. 
Information of this type is normally discussed during reduction in 
force counseling sessions between affected employees and knowledgeable 
personnel specialists. Releasing this type of information in a 
reduction in force notice has serious privacy implications and would 
not be useful in isolation, nor would it serve to help the employee 
better understand his/her reduction in force rights without counseling. 
Therefore, we have not adopted this suggestion.
    Another commenter questioned the restriction in the definition of 
critical elements to individual performance only, especially in light 
of the workplace trends toward team performance. We do not disagree 
with the observation that team work is becoming more prevalent in the 
workplace and should be captured when measuring performance. In 
recognition of the importance of team work in many organizations, the 
performance management regulations specifically provide for the use of 
non-critical elements that can address performance measured at the team 
level and that impact the summary level, which can be particularly 
useful in making performance distinctions above the Fully Successful 
(or equivalent) level. In addition, the regulations permit the use of 
critical elements to measure the individual's contribution to the 
team's success or failure. However, it would be inappropriate to allow 
a single team failure (i.e., failed team critical element) to result 
automatically in every individual on the team being designated as 
Unacceptable when some of the individual performance within the team is 
probably Fully Successful or better.
    Critical elements are the cornerstone of individual accountability 
in employee performance. Therefore, they should not be used to measure 
performance over which the employee is not intended or expected to 
exercise individual control or authority. In addition, there is the 
prohibition that non-critical elements cannot be used with a two-level 
summary pattern (i.e., pass/fail). Organizations that summarize 
performance at only two levels can choose to incorporate additional 
performance elements to identify and measure team accomplishments. We, 
therefore, made no change to this proposal.
    One commenter suggested that a within-grade increase following a 
delay, based on the circumstances stated in the regulations and a 
subsequent rating of record of Level 3 or higher, should be paid 
retroactively. Because no change was, or is, proposed to the current 
language at 5 CFR 531.409(c)(2)(iii) that addresses a retroactive 
within-grade increase following a delay in the acceptable level of 
competence determination, that paragraph had not appeared in the 
proposed regulations as printed in the Federal Register. Because that 
current language will remain in effect, the commenter's concern is 
already accommodated.
    One commenter suggested that within-grade delay procedures should 
be incorporated into agency performance management plans and, thereby, 
be subject to OPM review and approval. Within-grade delay is prescribed 
by regulation because it is a procedure where Governmentwide 
consistency is appropriate. There is no value added to having OPM 
review agency procedures implementing such uniform regulations. 
Furthermore, the Performance Management Plan alluded

[[Page 62500]]

to is no longer required because, in part, the 1995 revision was 
designed to eliminate needless repetition of regulatory language. 
Therefore, this suggestion was not adopted.
    Several other suggestions for minor wording changes to provide 
greater clarification were adopted where we felt they were warranted. 
Most of the requests for clarification or additional discussion would 
be more appropriately handled through individual discussions between 
OPM staff and agency personnelists, which we are happy to provide upon 
request. In addition, some comments were provided that addressed 
reduction in force and performance management issues that were outside 
the scope of these proposed regulations, such as changing the way 
performance is used relative to the other reduction in force factors; 
these suggestions were not adopted since they were not pertinent to the 
specific proposals made in these regulations. Suggestions for wording 
changes to 5 CFR part 293 were not adopted because we felt there was no 
basis for issuing revised regulations in this area as long as we were 
eliminating the proposal to lengthen the ``look-back'' period for 
ratings of record.
    To the extent practicable, these regulations should be implemented 
by agencies in partnership with management and employees' union 
representatives.

Regulatory Flexibility Act

    I certify that this regulation will not have a significant economic 
impact on a substantial number of small entities because it only 
affects Federal employees.

Executive Order 12866, Regulatory Review

    This rule has been reviewed by the Office of Management and Budget 
in accordance with Executive Order 12866.

List of Subjects

5 CFR Part 351

    Administrative practice and procedure, Government employees.

5 CFR Part 430

    Decorations, medals, awards, Government employees.

5 CFR Part 531

    Government employees, Law enforcement officers, Wages.

Office of Personnel Management.
Janice R. Lachance,
Acting Director.
    Accordingly, OPM is amending parts 351, 430, and 531 of title 5, 
Code of Federal Regulations, as follows:

PART 351--REDUCTION IN FORCE

    4. The authority citation for part 351 continues to read as 
follows:

    Authority: 5 U.S.C. 1302, 3502, 3503.

    5. In Sec. 351.203, the definition of ``Annual Performance rating 
of record'' is removed, and the definitions of Current rating of 
record, Modal rating, and Rating of record are added in alphabetical 
order, to read as follows:


Sec. 351.203  Definitions.

* * * * *
    Current rating of record is the rating of record for the most 
recently completed appraisal period as provided in Sec. 351.504(b)(3).
* * * * *
    Modal rating is the summary rating level assigned most frequently 
among the actual ratings of record that are:
    (1) Assigned under the summary level pattern that applies to the 
employee's position of record on the date of the reduction in force;
    (2) Given within the same competitive area, or at the agency's 
option within a larger subdivision of the agency or agencywide; and
    (3) On record for the most recently completed appraisal period 
prior to the date of issuance of reduction in force notices or the 
cutoff date the agency specifies prior to the issuance of reduction in 
force notices after which no new ratings will be put on record.
    Rating of record has the meaning given that term in Sec. 430.203 of 
this chapter. For an employee not subject to 5 U.S.C. Chapter 43, or 
part 430 of this chapter, it means the officially designated 
performance rating, as provided for in the agency's appraisal system, 
that is considered to be an equivalent rating of record under the 
provisions of Sec. 430.201(c) of this chapter.
* * * * *
    7. In Sec. 351.402, paragraph (b) is revised to read as follows:


Sec. 351.402  Competitive area.

* * * * *
    (b) A competitive area must be defined solely in terms of the 
agency's organizational unit(s) and geographical location, and it must 
include all employees within the competitive area so defined. A 
competitive area may consist of all or part of an agency. The minimum 
competitive area is a subdivision of the agency under separate 
administration within the local commuting area.
* * * * *
    8. In Sec. 351.403, paragraph (c) is added to read as follows:


Sec. 351.403  Competitive level.

* * * * *
    (c) An agency may not establish a competitive level based solely 
upon:
    (1) A difference in the number of hours or weeks scheduled to be 
worked by other-than-full-time employees who would otherwise be in the 
same competitive level;
    (2) A requirement to work changing shifts;
    (3) The grade promotion potential of the position; or
    (4) A difference in the local wage areas in which wage grade 
positions are located.
    9. In Sec. 351.404, paragraph (a) introductory text, and paragraph 
(b)(2), are revised to read as follows:


Sec. 351.404  Retention register.

    (a) When a competing employee is to be released from a competitive 
level under this part, the agency shall establish a separate retention 
register for that competitive level. The retention register is prepared 
from the current retention records of employees. Upon displacing 
another employee under this part, an employee retains the same status 
and tenure in the new position. Except for an employee on military duty 
with a restoration right, the agency shall enter on the retention 
register, in the order of retention standing, the name of each 
competing employee who is:
* * * * *
    (b) * * *
    (2) The agency shall list, at the bottom of the list prepared under 
paragraph (b)(1) of this section, the name of each employee in the 
competitive level with a written decision of removal under part 432 or 
752 of this chapter.
    10. Section 351.405 is revised to read as follows:


Sec. 351.405  Demoted employees.

    An employee who has received a written decision under part 432 or 
752 of this chapter to demote him or her competes under this part from 
the position to which he or she will be or has been demoted.
    11. In Sec. 351.501, paragraph (b)(3) is revised to read as 
follows:


Sec. 351.501  Order of retention--competitive service.

* * * * *
    (b) * * *
    (3) Group III includes all employees serving under indefinite 
appointments, temporary appointments pending establishment of a 
register, status quo appointments, term appointments, and

[[Page 62501]]

any other nonstatus nontemporary appointments which meet the definition 
of provisional appointments contained in Secs. 316.401 and 316.403 of 
this chapter.
* * * * *
    12. Section 351.504 is revised to read as follows:


Sec. 351.504  Credit for performance.

    Note to Sec. 351.504: Compliance dates: Subject to the 
requirements of 5 U.S.C. Section 7116(a)(7), agencies may implement 
revised Sec. 351.504 at any time between December 24, 1997 and 
October 1, 1998. For reduction in force actions effective between 
December 24, 1997 and September 30, 1998, agencies may use either 
Sec. 351.504 effective December 24, 1997, or the prior Sec. 351.504 
in 5 CFR part 351 (January 1, 1997 edition).

    (a) Ratings used. (1) Only ratings of record as defined in 
Sec. 351.203 shall be used as the basis for granting additional 
retention service credit in a reduction in force.
    (2) For employees who received ratings of record while covered by 
part 430, subpart B, of this chapter, those ratings of record shall be 
used to grant additional retention service credit in a reduction in 
force.
    (3) For employees who received performance ratings while not 
covered by the provisions of 5 U.S.C. Chapter 43 and part 430, subpart 
B, of this chapter, those performance ratings shall be considered 
ratings of record for granting additional retention service credit in a 
reduction in force only when it is determined that those performance 
ratings are equivalent ratings of record under the provisions of 
Sec. 430.201(c) of this chapter. The agency conducting the reduction in 
force shall make that determination.
    (b)(1) An employee's entitlement to additional retention service 
credit for performance under this subpart shall be based on the 
employee's three most recent ratings of record received during the 4-
year period prior to the date of issuance of reduction in force 
notices, except as otherwise provided in paragraphs (b)(2) and (c) of 
this section.
    (2) To provide adequate time to determine employee retention 
standing, an agency may provide for a cutoff date, a specified number 
of days prior to the issuance of reduction in force notices after which 
no new ratings of record will be put on record and used for purposes of 
this subpart. When a cutoff date is used, an employee will receive 
performance credit for the three most recent ratings of record received 
during the 4-year period prior to the cutoff date.
    (3) To be creditable for purposes of this subpart, a rating of 
record must have been issued to the employee, with all appropriate 
reviews and signatures, and must also be on record (i.e., the rating of 
record is available for use by the office responsible for establishing 
retention registers).
    (4) The awarding of additional retention service credit based on 
performance for purposes of this subpart must be uniformly and 
consistently applied within a competitive area, and must be consistent 
with the agency's appropriate issuance(s) that implement these 
policies. Each agency must specify in its appropriate issuance(s):
    (i) The conditions under which a rating of record is considered to 
have been received for purposes of determining whether it is within the 
4-year period prior to either the date the agency issues reduction in 
force notices or the agency-established cutoff date for ratings of 
record, as appropriate; and
    (ii) If the agency elects to use a cutoff date, the number of days 
prior to the issuance of reduction in force notices after which no new 
ratings of record will be put on record and used for purposes of this 
subpart.
    (c) Missing ratings. Additional retention service credit for 
employees who do not have three actual ratings of record during the 4-
year period prior to the date of issuance of reduction in force notices 
or the 4-year period prior to the agency-established cutoff date for 
ratings of record permitted in paragraph (b)(2) of this section shall 
be determined under paragraphs (d) or (e) of this section, as 
appropriate, and as follows:
    (1) An employee who has not received any rating of record during 
the 4-year period shall receive credit for performance based on the 
modal rating for the summary level pattern that applies to the 
employee's official position of record at the time of the reduction in 
force.
    (2) An employee who has received at least one but fewer than three 
previous ratings of record during the 4-year period shall receive 
credit for performance on the basis of the value of the actual 
rating(s) of record divided by the number of actual ratings received. 
If an employee has received only two actual ratings of record during 
the period, the value of the ratings is added together and divided by 
two (and rounded in the case of a fraction to the next higher whole 
number) to determine the amount of additional retention service credit. 
If an employee has received only one actual rating of record during the 
period, its value is the amount of additional retention service credit 
provided.
    (d) Single rating pattern. If all employees in a reduction in force 
competitive area have received ratings of record under a single pattern 
of summary levels as set forth in Sec. 430.208(d) of this chapter, the 
additional retention service credit provided to employees shall be 
expressed in additional years of service and shall consist of the 
mathematical average (rounded in the case of a fraction to the next 
higher whole number) of the employee's applicable ratings of record, 
under paragraphs (b)(1) and (c) of this section computed on the 
following basis:
    (1) Twenty additional years of service for each rating of record 
with a Level 5 (Outstanding or equivalent) summary;
    (2) Sixteen additional years of service for each rating of record 
with a Level 4 summary; and
    (3) Twelve additional years of service for each rating of record 
with a Level 3 (Fully Successful or equivalent) summary.
    (e) Multiple rating patterns. If an agency has employees in a 
competitive area who have ratings of record under more than one pattern 
of summary levels, as set forth in Sec. 430.208(d) of this chapter, it 
shall consider the mix of patterns and provide additional retention 
service credit for performance to employees expressed in additional 
years of service in accordance with the following:
    (1) Additional years of service shall consist of the mathematical 
average (rounded in the case of a fraction to the next higher whole 
number) of the additional retention service credit that the agency 
established for the summary levels of the employee's applicable 
rating(s) of record.
    (2) The agency shall establish the amount of additional retention 
service credit provided for summary levels only in full years; the 
agency shall not establish additional retention service credit for 
summary levels below Level 3 (Fully Successful or equivalent).
    (3) When establishing additional retention service credit for the 
summary levels at Level 3 (Fully Successful or equivalent) and above, 
the agency shall establish at least 12 years, and no more than 20 
years, additional retention service credit for a summary level.
    (4) The agency may establish the same number of years additional 
retention service credit for more than one summary level.
    (5) The agency shall establish the same number of years additional 
retention service credit for all ratings of record with the same 
summary level in the same pattern of summary levels as set forth in 
Sec. 430.208(d) of this chapter.

[[Page 62502]]

    (6) The agency may establish a different number of years additional 
retention service credit for the same summary level in different 
patterns.
    (7) In implementing paragraph (e) of this section, the agency shall 
specify the number(s) of years additional retention service credit that 
it will establish for summary levels. This information shall be made 
readily available for review.
    (8) The agency may apply paragraph (e) of this section only to 
ratings of record put on record on or after October 1, 1997. The agency 
shall establish the additional retention service credit for ratings of 
record put on record prior to that date in accordance with paragraph 
(d) of this section.
    13. In Sec. 351.602, paragraph (c) is revised to read as follows:


Sec. 351.602  Prohibitions.

* * * * *
    (c) A written decision under part 432 or 752 of this chapter of 
removal or demotion from the competitive level.
    14. In Sec. 351.701, paragraph (f) is added to read as follows:


Sec. 351.701  Assignment involving displacement.

* * * * *
    (f)(1) In determining applicable grades (or grade intervals) under 
Secs. 351.701(b)(2) and 351.701(c)(2), the agency uses the grade 
progression of the released employee's position of record to determine 
the grade (or interval) limits of the employee's assignment rights.
    (2) For positions covered by the General Schedule, the agency must 
determine whether a one-grade, two-grade, or mixed grade interval 
progression is applicable to the position of the released employee.
    (3) For positions not covered by the General Schedule, the agency 
must determine the normal line of progression for each occupational 
series and grade level to determine the grade (or interval) limits of 
the released employee's assignment rights. If the agency determines 
that there is no normal line of progression for an occupational series 
and grade level, the agency provides the released employee with 
assignment rights to positions within three actual grades lower on a 
one-grade basis. The normal line of progression may include positions 
in different pay systems.
    (4) For positions where no grade structure exists, the agency 
determines a line of progression for each occupation and pay rate, and 
provides assignment rights to positions within three grades (or 
intervals) lower on that basis.
    (5) If the released employee holds a position that is less than 
three grades above the lowest grade in the applicable classification 
system (e.g., the employee holds a GS-2 position), the agency provides 
the released employee with assignment rights up to three actual grades 
lower on a one-grade basis in other pay systems.
    15. In Sec. 351.705, paragraph (a)(3) is revised to read as 
follows:


Sec. 351.705  Administrative assignment.

    (a) * * *
    (3) Provide competing employees in the excepted service with 
assignment rights to other positions under the same appointing 
authority on the same basis as assignment rights provided to 
competitive service employees under Sec. 351.701 and in paragraphs (a) 
(1) and (2) of this section.
* * * * *
    16. In Sec. 351.802, paragraph (a)(2) is revised to read as 
follows:


Sec. 351.802  Content of notice.

    (a) * * *
    (2) The employee's competitive area, competitive level, subgroup, 
service date, and three most recent ratings of record received during 
the last 4 years.
* * * * *
    17. In Sec. 351.803, paragraph (a) is revised to read as follows:


Sec. 351.803  Notice of eligibility for reemployment and other 
placement assistance.

    (a) An employee who receives a specific notice of separation under 
this part must be given information concerning the right to 
reemployment consideration and career transition assistance under 
subparts B (Reemployment Priority List), F and G (Career Transition 
Assistance Programs) of part 330 of this chapter. The employee must 
also be given a release to authorize, at his or her option, the release 
of his or her resume and other relevant employment information for 
employment referral to State dislocated worker unit(s) and potential 
public or private sector employers. The employee must also be given 
information concerning how to apply both for unemployment insurance 
through the appropriate State program and benefits available under the 
State dislocated worker unit(s), as designated or created under title 
III of the Job Training Partnership Act, and an estimate of severance 
pay (if eligible).

    Note to Sec. 351.803(a): Compliance dates: Subject to the 
requirements of 5 U.S.C. 7116(a)(7), agencies may implement revised 
Sec. 351.803(a) at any time between December 24, 1997 and October 1, 
1998. For reduction in force actions effective between December 24, 
1997 and September 30, 1998, agencies may use either Sec. 351.803(a) 
effective December 24, 1997, or the prior Sec. 351.803(a) in 5 CFR 
part 351 (January 1, 1997 edition).
* * * * *
    18. Section 351.804 is revised to read as follows:


Sec. 351.804  Expiration of notice.

    (a) A notice expires when followed by the action specified, or by 
an action less severe than specified, in the notice or in an amendment 
made to the notice before the agency takes the action.
    (b) An agency may not take the action before the effective date in 
the notice; instead, the agency may cancel the reduction in force 
notice and issue a new notice subject to this subpart.
    19. Section 351.805 is revised to read as follows:


Sec. 351.805  New notice required.

    (a) An employee is entitled to a written notice of, as appropriate, 
at least 60 or 120 full days if the agency decides to take an action 
more severe than first specified.
    (b) An agency must give an employee an amended written notice if 
the reduction in force is changed to a later date. A reduction in force 
action taken after the date specified in the notice given to the 
employee is not invalid for that reason, except when it is challenged 
by a higher-standing employee in the competitive level who is reached 
out of order for a reduction in force action as a result of the change 
in dates.
    (c) An agency must give an employee an amended written notice and 
allow the employee to decide whether to accept a better offer of 
assignment under subpart G of this part that becomes available before 
or on the effective date of the reduction in force. The agency must 
give the employee the amended notice regardless of whether the employee 
has accepted or rejected a previous offer of assignment, provided that 
the employee has not voluntarily separated from his or her official 
position.

PART 430--PERFORMANCE MANAGEMENT

    20. The authority citation for part 430 continues to read as 
follows:

    Authority: 5 U.S.C. chapter 43.

    21. In Sec. 430.201, paragraph (c) is added to read as follows:


Sec. 430.201  General.

* * * * *
    (c) Equivalent ratings of record. (1) If an agency has 
administratively adopted and applied the procedures of this

[[Page 62503]]

subpart to evaluate the performance of its employees, the ratings of 
record resulting from that evaluation are considered ratings of record 
for reduction in force purposes.
    (2) Other performance evaluations given while an employee is not 
covered by the provisions of this subpart are considered ratings of 
record for reduction in force purposes when the performance 
evaluation--
    (i) Was issued as an officially designated evaluation under the 
employing agency's performance evaluation system,
    (ii) Was derived from the appraisal of performance against 
expectations that are established and communicated in advance and are 
work related, and
    (iii) Identified whether the employee performed acceptably.
    (3) When the performance evaluation does not include a summary 
level designator and pattern comparable to those established at 
Sec. 430.208(d), the agency may identify a level and pattern based on 
information related to the appraisal process.
    22. In Sec. 430.203, the definitions of Critical element, 
Performance rating, and Rating of record are revised to read as 
follows:


Sec. 430.203  Definitions.

* * * * *
    Critical element means a work assignment or responsibility of such 
importance that unacceptable performance on the element would result in 
a determination that an employee's overall performance is unacceptable. 
Such elements shall be used to measure performance only at the 
individual level.
* * * * *
    Performance rating means the written, or otherwise recorded, 
appraisal of performance compared to the performance standard(s) for 
each critical and non-critical element on which there has been an 
opportunity to perform for the minimum period. A performance rating may 
include the assignment of a summary level within a pattern (as 
specified in Sec. 430.208(d)).
* * * * *
    Rating of record means the performance rating prepared at the end 
of an appraisal period for performance of agency-assigned duties over 
the entire period and the assignment of a summary level within a 
pattern (as specified in Sec. 430.208(d)), or (2) in accordance with 
Sec. 531.404(a)(1) of this chapter. These constitute official ratings 
of record referenced in this chapter.
    23. In Sec. 430.206, paragraphs (a)(2) and (b)(4) are revised, 
paragraphs (b)(6) and (b)(7) are redesignated as paragraphs (b)(7) and 
(b)(8) respectively, and a new paragraph (b)(6) is added to read as 
follows:


Sec. 430.206  Planning performance.

    (a) * * *
    (2) Each program shall specify a single length of time as its 
appraisal period. The appraisal period generally shall be 12 months so 
that employees are provided a rating of record on an annual basis. A 
program's appraisal period may be longer when work assignments and 
responsibilities so warrant or performance management objectives can be 
achieved more effectively.
    (b) * * *
    (4) Each performance plan shall include all elements which are used 
in deriving and assigning a summary level, including at least one 
critical element and any non-critical element(s).
* * * * *
    (6) A performance plan established under an appraisal program that 
uses only two summary levels (pattern A as specified in 
Sec. 430.208(d)(1)) shall not include non-critical elements.
* * * * *
    24. In Sec. 430.208, the introductory text to paragraph (d)(2) is 
revised, paragraph (d)(4) is revised, and a new paragraph (d)(5) is 
added to read as follows:


Sec. 430.208  Rating performance.

* * * * *
    (d) * * *
    (2) Within any of the patterns shown in paragraph (d)(1) of this 
section, summary levels shall comply with the following requirements:
* * * * *
    (4) The designation of a summary level and its pattern shall be 
used to provide consistency in describing ratings of record and as a 
reference point for applying other related regulations, including, but 
not limited to, assigning additional retention service credit under 
Sec. 351.504 of this chapter.
    (5) Under the provisions of Sec. 351.504(e) of this chapter, the 
number of years of additional retention service credit established for 
a summary level of a rating of record shall be applied in a uniform and 
consistent manner within a competitive area in any given reduction in 
force, but the number of years may vary:
    (i) In different reductions in force;
    (ii) In different competitive areas; and
    (iii) In different summary level patterns within the same 
competitive area.
* * * * *

PART 531--PAY UNDER THE GENERAL SCHEDULE

    25. The authority citation for part 531 continues to read as 
follows:

    Authority: 5 U.S.C. 5115, 5307, and 5338; sec. 4 of Pub. L. 103-
89, 107 Stat. 981; and E.O. 12748, 56 FR 4521, 3 CFR, 1991 Comp., p. 
316;
    Subpart B also issued under 5 U.S.C. 5303(g), 5333, 5334(a), and 
7701(b)(2);
    Subpart C also issued under 5 U.S.C. 5304, 5305, and 5553; 
sections 302 and 404 of FEPCA, Pub. L. 101-509, 104 Stat. 1462 and 
1466; and section 3(7) of Pub. L. 102-378, 106 Stat. 1356;
    Subpart D also issued under 5 U.S.C. 5335(g) and 7701(b)(2);
    Subpart E also issued under 5 U.S.C. 5336;
    Subpart F also issued under 5 U.S.C. 5304, 5305(g)(1), and 5553; 
and E.O. 12883, 58 FR 63281, 3 CFR, 1993 Comp., p. 682;
    Subpart G also issued under 5 U.S.C. 5304, 5305, and 5553; 
section 302 of the Federal Employees Pay Comparability Act of 1990 
(FEPCA), Pub. L. 101-509, 104 Stat. 1462; and E.O. 12786, 56 FR 
67453, 3 CFR, 1991 Comp., p. 376.

    26. In Sec. 531.409, paragraphs (c)(1), (c)(2)(i), and (c)(2)(ii) 
are revised to read as follows:


Sec. 531.409  Acceptable level of competence determinations.

* * * * *
    (c) Delay in determination. (1) An acceptable level of competence 
determination shall be delayed when, and only when, either of the 
following applies:
    (i) An employee has not had the minimum period of time established 
at Sec. 430.207(a) of this chapter to demonstrate acceptable 
performance because he or she has not been informed of the specific 
requirements for performance at an acceptable level of competence in 
his or her current position, and the employee has not been given a 
performance rating in any position within the minimum period of time 
(as established at Sec. 430.207(a) of this chapter) before the end of 
the waiting period; or
    (ii) An employee is reduced in grade because of unacceptable 
performance to a position in which he or she is eligible for a within-
grade increase or will become eligible within the minimum period as 
established at Sec. 430.207(a) of this chapter.
    (2) * * *
    (i) The employee shall be informed that his or her determination is 
postponed and the appraisal period extended and shall be told of the 
specific requirements for performance at an acceptable level of 
competence.
    (ii) An acceptable level of competence determination shall then be 
made based on the employee's rating of record

[[Page 62504]]

completed at the end of the extended appraisal period.
* * * * *

[FR Doc. 97-30428 Filed 11-21-97; 8:45 am]
BILLING CODE 6325-01-U