[Federal Register Volume 64, Number 18 (Thursday, January 28, 1999)]
[Proposed Rules]
[Pages 4336-4342]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-1958]


 ========================================================================
 Proposed Rules
                                                 Federal Register
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 This section of the FEDERAL REGISTER contains notices to the public of 
 the proposed issuance of rules and regulations. The purpose of these 
 notices is to give interested persons an opportunity to participate in 
 the rule making prior to the adoption of the final rules.
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  Federal Register / Vol. 64, No. 18 / Thursday, January 28, 1999 / 
Proposed Rules  

[[Page 4336]]


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OFFICE OF PERSONNEL MANAGEMENT

5 CFR Part 731

RIN 3206-AC19


Suitability

AGENCY: Office of Personnel Management.

ACTION: Proposed rule with request for comments.

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SUMMARY: The Office of Personnel Management (OPM) is proposing changes 
to the rule on personnel suitability which OPM previously issued as a 
proposed rule for comments. OPM has received and considered public 
comments and is now publishing for comment proposed changes. The 
proposed rule addresses many of the concerns expressed, incorporates 
many of the suggestions received, and makes additional changes because 
of policy revisions and the abolishment of the Federal Personnel Manual 
(FPM). OPM will issue final regulations after review of the comments 
received on this proposed rule.

DATES: Comments must be submitted on or before March 1, 1999.

ADDRESSES: Send written comments to: Richard A. Ferris, Associate 
Director, Investigations Service, room 5416, U.S. Office of Personnel 
Management, 1900 E Street, NW, Washington, DC 20415-4000, fax: 202-606-
2390, e-mail: [email protected].

FOR FURTHER INFORMATION CONTACT: Thomas DelPozzo, (724) 794-5612.

SUPPLEMENTARY INFORMATION: OPM promulgated the proposed final 
suitability regulations with a request for comments in the Federal 
Register (61 FR 394, Jan. 5, 1996). Comments were received from 19 
sources, including Federal agencies, individuals, and public interest 
organizations. Because of changes made in certain parts of these rules, 
we are seeking additional comments. Those who responded to the January 
5, 1996, publication need not submit their comments again. Those 
responses will continue to be considered. Additionally, when part 731 
was previously published, proposed changes to parts 732 and 736 were 
published at the same time. Those parts are still under consideration 
and individuals who commented on those parts need not respond to this 
publication. Those comments are still being considered. The following 
summarizes the principal comments and suggestions received and proposed 
actions to be taken, as well as information added because of the 
abolishment of the FPM or changes made because of policy revisions.

Part 731

Organization

    Some subparts and sections were moved, added or removed for 
clarification purposes (only one section--Sec. 731.203--Due Process--
was removed, but the information was moved to Sec. 731.103), as 
follows:

Subpart A--Scope

Sec.
731.101  Purpose.
731.102  Implementation.
731.103  Delegation to agencies.
731.104  Appointments subject to investigation.
731.105  Jurisdiction.
731.106  Designation of public trust positions and investigative 
requirements.

Subpart B--Suitability Determinations

731.201  Standard.
731.202  Criteria.
731.203  Actions by OPM and other agencies.
731.204  Debarment by OPM.
731.205  Debarment by agencies.

Subpart C--Suitability Action Procedures

731.301  Scope.
731.302  Notice of proposed action.
731.303  Answer.
731.304  Decision.

Subpart D--Appeal to the Merit Systems Protection Board

731.401  Appeal to the Merit Systems Protection Board.

Subpart E--Savings Provision

731.601  Savings provision.

Section 731.101  Purpose

    Agencies asked a number of questions about when to apply the 
regulations (i.e., Excepted Service employees with or without 
intentional falsification, non-probationary employees, reinvestigated 
employees, employees with investigations initiated or completed after 
the first year). No changes were made in this section (Sec. 731.101 
currently explains part 731 is used to make suitability determinations 
for employment in positions in the competitive service or for career 
appointment in the Senior Executive Service). However, clarifications 
were added at various other points (e.g., Secs. 731.104 and 731.105 
address investigation time frames, and Sec. 731.106 addresses 
reinvestigations).
    Language in the former Basic Federal Personnel Manual also stated 
that ``Heads of agencies, at their discretion, may apply all or part of 
these requirements (in part 731) for employment or continued employment 
in positions outside the competitive service.'' This clarification will 
be included in supplemental guidance.
    In response to agencies' requests, some definitions were added. 
Other definitions will be included in supplemental guidance.

Section 731.102  Implementation

    With the increased delegation of responsibilities to agencies, 
clarification was added to point out the consequences of not carrying 
out responsibilities according to OPM regulations (i.e., revocation of 
delegation).

Section 731.103  Delegation to Agencies

    One commenter felt the regulations should incorporate the guidance 
an agency will need to implement 5 CFR part 731, rather than issuing 
separate guidance. Because the CFR is a general body of regulatory laws 
governing practices and procedures, the detailed guidance/instructions 
will be issued separately. This guidance will allow agencies 
flexibility in carrying out the regulations and opportunity to develop 
their own internal procedures. OPM intends to issue this supplemental 
guidance as soon as possible after the regulations are finalized.
    Comment was received from agencies regarding the hardship that 
delegation of applicant and appointee suitability adjudication 
authority would create from a staffing/training standpoint. Several 
wondered if they could redelegate or contract out their suitability 
adjudication responsibility. Although training may be needed, we 
believe the staffing implications for

[[Page 4337]]

agencies will be negligible. OPM will continue to adjudicate material 
falsification cases, and debarment cases when referred to OPM by an 
agency, which should encompass most of the adverse adjudication 
workload. The major benefit of delegating applicant suitability 
authority to agencies is that they no longer will have to refer all 
competitive examining applications with admitted suitability issues to 
OPM for suitability review.
    One agency indicated contracting out adjudication decisions is 
currently prohibited. With OPM's Investigations Service privatization 
effort, OPM has contracted much of its adjudicative case processing, 
with close OPM oversight. However, OPM has retained all decision making 
responsibility, which it views as an inherently governmental function. 
Any agency contracting of OPM delegated suitability adjudication would 
be subject to OPM approval to ensure the agency retains the 
responsibility for all adjudicative decisions and develops a sufficient 
oversight program.
    Agencies' delegated suitability authority under part 731 procedures 
is limited to applicant and appointee cases. Only OPM will adjudicate 
employee cases under part 731 procedures, since OPM is retaining 
authority for adjudicating material falsification cases, and material 
falsification is the most commonly used suitability factor in employee 
cases. An agency will have to use another authority such as part 752, 
if appropriate, to take action against an employee for reasons that 
could also form the basis for a part 731 suitability action. Agencies 
may also take action under other authorities, if appropriate, in 
appointee cases. Allowing agencies to use existing authorities, as 
appropriate, will provide them with more flexibility--i.e., part 315 is 
a more expedited procedure, and part 752 allows actions other than 
removal (although no debarment actions may be included using these 
authorities).
    A few commenters opposed OPM's decision to retain jurisdiction over 
falsification cases; they felt it was cumbersome and not necessary. It 
was argued agencies are in a better position to adjudicate 
falsification cases involving their employees than OPM, since OPM is 
removed from and not familiar with the employee. However, it is 
precisely for this reason that OPM has decided to retain this 
authority. OPM will continue to adjudicate falsification cases across 
agency lines, and then take the appropriate action (removal and 
extended debarment from all competitive service positions) when an 
appointment is obtained fraudulently. This also is consistent with 
OPM's role in protecting the Merit System and reflects the position 
that performance in a position obtained through fraud is irrelevant.
    In agreement with agency comments that, because of law or 
regulation they could not be delegated, OPM also retained jurisdiction 
in ``refusal to furnish testimony'' cases, and those cases involving 30 
percent or more Compensable Disability Preference veterans.
    In Sec. 731.103(b) agencies are given the option of referring a 
case with suitability issues to OPM when a general, across agency lines 
debarment appears warranted, or adjudicating the case themselves. OPM 
will require that agencies conduct a sufficient level of investigation 
to resolve potentially serious suitability issues and determine if OPM 
debarment is warranted. The agency will need to coordinate with OPM 
before referring any cases. OPM will issue additional guidance to 
agencies to show what issues would warrant referral, i.e., support a 
general debarment or a nexus debarment from general classifications of 
jobs across agency lines (e.g., all law enforcement positions). OPM 
adjudication will be at OPM's discretion.
    To respond to concerns about when a suitability determination is 
needed, Sec. 731.103(d) was added. The guidance is consistent with OPM 
Investigations Service's Federal Investigations Notice 95-1, issued 
January 19, 1995, and available from OPM's Investigations Service, 
which instructed agencies to determine qualifications and whether the 
person was in reach of selection before considering suitability 
matters.
    The section previously entitled ``Due Process'' (Sec. 731.203) was 
included in this section as paragraph (e) for clarification of 
delegated responsibilities.
    Some commenters wanted the regulations to authorize consideration 
of confidential information when making a suitability determination. 
Clarification was added to Sec. 731.103(e)(3) explaining the proper use 
of confidential information in a suitability decision, i.e., the 
confidential information can be used as lead information and in 
interrogatories if the identity of the source is not compromised in any 
way. Fairness requires that only non-confidential information be used 
as a basis for an adverse action. Additionally, confidential 
information cannot normally be disclosed in administrative or judicial 
forums.
    Commenters wanted to limit the appeal rights given to probationary 
employees under part 731. If the agency takes an action under part 731, 
it must follow the procedures and provide the appeal rights stated in 
this part. Part 315, covering probationers, contains more limited 
appeal rights and may also be used.

Sections 731.104  Appointments Subject to Investigation, and 731.105 
Jurisdiction

    Commenters suggested clarifying jurisdiction. The language in the 
previous regulation dealing with jurisdiction discussed appointments 
``subject to investigation,'' which was confusing, and created problems 
for agencies. Commenters felt the 1 year subject to investigation 
requirement was the time frame for initiating and completing 
investigations. The 1 year period is used to determine jurisdiction 
(OPM or the employing agency) and is not an investigative restriction. 
We made revisions to part 731 to clarify this topic, adding definitions 
under Sec. 731.101(b) and using separate sections to differentiate 
between ``subject to investigation'' (Sec. 731.104) and 
``jurisdiction'' (Sec. 731.105).

Section 731.106  Designation of Public Trust Positions and 
Investigative Requirements

    Commenters, fearing inconsistencies between agencies, recommended 
retaining definitions for risk level designations. OPM has done so, and 
will also issue a model agencies may use to determine risk in 
supplemental guidance.
    A commenter recommended adding to the definition of ``high risk 
public trust'' any position that regularly involves access to 
information concerning law enforcement, including criminal 
investigations. ``Access to sensitive but unclassified information'' 
and ``law enforcement duties'' are already included in the definition; 
agencies may also use the ``other duties demanding a high degree of 
public trust'' category to meet their individual needs.
    Some agencies felt they should be given authority to determine the 
level of investigation needed for a particular position. OPM will 
provide supplemental guidance which will include minimum standards for 
government-wide consistency but allow some flexibility regarding 
investigative requirements. Agencies will need to consider both the 
level of public trust and position sensitivity to ensure the 
appropriate level of investigation is conducted as required by parts 
731 and 732.
    OPM's reinvestigation requirement for public trust positions was 
eliminated from the published proposed

[[Page 4338]]

regulations. Commenters opposed this removal, believing 
reinvestigations to be a necessary and valuable tool for their use in 
ensuring the public trust. While OPM finds no explicit statutory 
authority on which to base an OPM requirement that agencies conduct 
public trust reinvestigations, agencies may rely on other appropriate 
authority to require that certain positions be subject to periodic 
reinvestigations. We reference some other authorities in this section. 
Agencies may also promulgate their own regulations to require 
reinvestigations for certain public trust positions if they have no 
other existing authority.
    Commenters requested clarification regarding reinvestigation 
requirements when a person moves from a lower to higher risk position. 
This was done in Sec. 731.106(e).

Section 731.201  Standard

    Proposed regulation had added ``other appropriate actions'' as 
being possible, in addition to removals, in suitability cases. One 
agency wanted ``other appropriate actions'' identified. OPM decided to 
remove this wording. OPM will be making debarment and removal decisions 
only, and if agencies want to take other actions, such as a suspension, 
there are other authorities they can use when appropriate (i.e., part 
752).
    The phrase ``protect the integrity * * * of the service'' was 
added. This clarifies that an important facet of the suitability 
standard is the integrity of the Merit System and fair and open 
competition for positions.
    A commenter felt Sec. 731.201 requires an adverse suitability 
determination on every unsuccessful candidate and asked if ``federal 
employment'' was used in the narrow or broadest sense. We added 
clarifying and limiting language to subpart A, particularly at 
Sec. 731.103(d), to address this concern. The ``Delegation Examining 
Operations Handbook'' lists a number of reasons an eligible may be 
eliminated from consideration. Suitability is only one of these 
reasons. The Handbook also recommends suitability review be done in the 
hiring phase. OPM will be issuing further clarification regarding the 
suitability adjudication process in supplemental guidance.

Section 731.202  Criteria

    Language was deleted from the general criteria of Sec. 731.202(a) 
and from the suitability factors in Sec. 731.202(b)(1) and (2). Nexus 
language is contained in Sec. 731.201.
    Language was returned to Sec. 731.202(c) to give an adjudicative 
agency discretion as to when to apply the additional considerations.
    A commenter felt the additional consideration ``circumstances 
surrounding the conduct'' covers the consideration of ``societal 
conditions'' which could then be removed. This was not changed because 
the factors address two separate areas of consideration that could 
impact the final decision. Our supplemental guidance will elaborate on 
all the additional considerations.

Section 731.203  Actions by OPM and Other Agencies

    Sec. 731.203(a) was revised to eliminate confusion over ``subject 
to investigation'' language and to be consistent with other similar 
revisions.
    OPM's authority to cancel reinstatement eligibility was added in 
Sec. 731.203(b) to ensure OPM's authority to do so is clear and 
contained in regulation and to further distinguish available OPM 
actions from agency actions.
    Wording was added to Sec. 731.203(c) so agencies will understand 
they may use other authorities in lieu of an action under part 731.
    We will clarify, in supplemental guidance, the procedures an agency 
should follow when releasing a copy of the ``materials relied upon'' 
referred to in Sec. 731.203(e) when the action is based on an OPM 
investigation.

Section 731.204  Debarment by OPM

    OPM has revised the regulations and delegated authority to agencies 
for limited debarments. This section distinguishes OPM's debarment 
authority and procedures from those delegated to agencies, which are 
addressed in Sec. 731.205.
    Section 731.204(b) was revised to reflect OPM's authority to take a 
subsequent debarment action after expiration of a prior period of 
debarment, but eliminates the requirement that OPM redetermine every 
debarred individual's suitability. This change also takes into 
consideration that, with delegated applicant suitability authority, 
agencies can adjudicate applicant cases when they have been previously 
debarred by OPM and the debarment has expired. The agency may favorably 
adjudicate at that point, refer for OPM review, or take their own 
debarment action. Unless new issues are present, a new general 
debarment action by OPM would normally not be warranted. The agency 
will be alerted to prior OPM debarments if reported by the subject on 
the OF 306 and/or SF 85P/86, or during the agency's Suitability/
Security Investigations Index (SII) check, and may use its delegated 
suitability authority to determine if the person is suitable for the 
specific position sought.

Section 731.205  Debarment by Agencies

    Since agencies would be making agency nexus adverse suitability 
decisions, OPM also delegates to them authority to take a limited 
debarment action, for a period not to exceed one year, and only for 
positions within that agency. This will prevent a person found 
unsuitable by an agency from immediately refiling an application for 
the same or other positions in the agency and ensure the agency does 
not have to make multiple suitability determinations in connection with 
the same individual.
    Since agency debarment authority is limited to applicants or 
appointees under part 731, the lack of agency authority to debar 
employees should prompt agencies to request investigations and 
adjudicate on a more timely basis when a person is first appointed. 
Also, if an employee is removed by an agency under part 752 and 
reapplies for a position in the agency, OPM or the agency may 
adjudicate suitability under part 731 as a separate action.
    The agency will be responsible for taking appropriate action if it 
determines a person has applied or been appointed while under agency 
debarment. ``Appropriate actions'' could include rating additional 
applications ineligible, removing an appointee, or referring the matter 
to OPM for general debarment.

Section 731.302  Notice of Proposed Action

    A commenter said the notice fails to advise the individual of his 
constitutional right to representation. The regulation does not prevent 
an individual from retaining counsel to assist in preparing a response 
to a proposed action if so desired, and specifically mentions 
representation in Sec. 731.303. Also, if a person appeals a suitability 
determination to MSPB, 5 CFR 1201.31 states the appellant may be 
represented in any matter related to the appeal.
    Commenters questioned the efficiency of the requirement that the 
notice of proposed action be mailed to both the duty station and last 
known address. We have changed the wording to allow OPM or the agency 
to decide the most effective and efficient method of delivery, to 
include mailings to both locations, if necessary, to ensure a timely 
delivery.

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    Section 731.302(c) was added to show a requirement specific to OPM.

Section 731.303  Answer

    Because only OPM will be adjudicating employee cases under part 731 
procedures (where an opportunity for an oral response is provided), we 
removed reference to the agency.

Section 731.304  Decision

    Commenters questioned the need to retain an appointee or employee 
30 days after OPM directs removal. We have eliminated this requirement. 
We now require that the agency effect OPM's directed removal action 
within 5 work days of receipt of our decision to allow agencies time to 
process the removal action.

Section 731.401  Appeal to the Merit Systems Protection Board

    A provision was added regarding MSPB modification of debarments. In 
cases where the MSPB does not sustain all the reasons for an OPM or 
agency debarment action and, as a result, determines the length of 
debarment may be inappropriate, the case would be returned to OPM or 
the agency to determine the debarment length warranted for the issues 
sustained.
    A commenter felt the agency option to either retain in a pay status 
pending appeal of an OPM directed removal, or remove, would be based on 
the level of agency support an appointee or employee enjoys, thereby 
creating two disparate classes. This concern is eliminated by our 
revision to Sec. 731.304.
    Reference to an OPM directed suspension was inappropriate here, and 
deleted, as discussed previously.

E.O. 12866, Regulatory Review

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

Regulatory Flexibility Act

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

List of Subjects in 5 CFR Part 731

    Administrative practice and procedure, Government employees.

Office of Personnel Management.
Janice R. Lachance,
Director.

    Accordingly, the Office of Personnel Management proposes to amend 5 
CFR part 731 as follows:
    Part 731 is revised to read as follows:

PART 731--SUITABILITY

Subpart A--Scope

Sec.
731.101  Purpose.
731.102  Implementation.
731.103  Delegation to agencies.
731.104  Appointments subject to investigation.
731.105  Jurisdiction.
731.106  Designation of public trust positions and investigative 
requirements.

Subpart B--Suitability Determinations 731.201 Standard.

731.202  Criteria.
731.203  Actions by OPM and other agencies.
731.204  Debarment by OPM.
731.205  Debarment by agencies.

Subpart C--Suitability Action Procedures 731.301 Scope.

731.302  Notice of proposed action.
731.303  Answer.
731.304  Decision.

Subpart D--Appeal to the Merit Systems Protection Board

731.401  Appeal to the Merit Systems Protection Board.

Subpart E--Savings Provision

731.501  Savings provision.
    Authority: 5 U.S.C. 1302, 3301, 7301,7701; E.O. 10577, 3 CFR 
1954-1958 Comp., p. 218; E.O. 12731, 3 CFR, 1990 Comp., p. 306., 5 
CFR, part 5.

Subpart A--Scope


Sec. 731.101  Purpose.

    (a) The purpose of this part is to establish criteria and 
procedures for making determinations of suitability for employment in 
positions in the competitive service and for career appointment in the 
Senior Executive Service (hereinafter in this part, ``competitive 
service'') pursuant to 5 U.S.C. 3301 and E.O. 10577 (3 CFR, 1954-1958 
Comp., p. 218). Section 3301 of title 5, United States Code, directs 
consideration of ``age, health, character, knowledge, and ability for 
the employment sought.'' E.O. 10577 directs OPM to examine 
``suitability'' for competitive Federal employment. This part concerns 
only determinations of ``suitability'' based on an individual's 
character or conduct that may impact the integrity or efficiency of the 
service. Determinations made under this part are distinct from 
determinations of eligibility for assignment to, or retention in, 
sensitive national security positions made under E.O. 10450 (3 CFR, 
1949-1953 Comp., p. 936), E.O. 12968 or similar authorities.
    (b) Definitions. In this part:
    Applicant. A person being considered for employment.
    Appointee. A person who has entered on duty and is in the first 
year of a subject to investigation appointment (as defined in 
Sec. 731.104).
    Employee. A person who has completed the first year of a subject to 
investigation appointment.
    Material, intentional false statement is one that is capable of 
influencing, or has a natural tendency to affect, an official decision. 
The test for materiality thus does not rest on whether an agency 
actually relied on the false statement.


Sec. 731.102  Implementation.

    (a) An investigation conducted for the purpose of determining 
suitability under this part may not be used for any other purpose 
except as provided in a Privacy Act system of records notice published 
by the agency conducting the investigation.
    (b) Under OMB Circular No. A-130 Revised, issued February 8, 1996, 
the Director of OPM is to establish personnel security policies for 
Federal personnel associated with the design, operation, or use of 
Federal automated information systems. Agencies are to implement and 
maintain a program to ensure that adequate security is provided for all 
automated information systems. Agency programs should be consistent 
with government-wide policies and procedures issued by OPM. The 
Computer Security Act of 1987 (Pub. L. 100-235) provides additional 
requirements for Federal automated information systems.
    (c) Policies, procedures, criteria, and guidance for the 
implementation of this part shall be set forth in issuances of the OPM. 
Agencies exercising authority under this part by delegation from OPM 
shall conform to such policies, procedures, criteria, and guidance. 
Failure to do so may result in revocation by OPM of an agency's 
delegation to adjudicate suitability under this part.


Sec. 731.103  Delegation to agencies.

    (a) OPM delegates to the heads of agencies limited authority for 
adjudicating suitability in cases involving applicants for and 
appointees to competitive service positions in the agency (including 
limited, agency-specific debarment authority under Sec. 731.205). OPM 
retains jurisdiction in all competitive service cases involving 
evidence of material, intentional false statement or deception or fraud 
in examination or appointment. Agencies must refer these cases to OPM 
for adjudication, or contact OPM for prior approval if the agency wants 
to take action under its own authority (5 CFR part 315 or 5 CFR part 
752). Also, this delegation does not include cases

[[Page 4340]]

involving refusal to furnish testimony as required by Sec. 5.4 of this 
chapter, or passover requests involving preference eligibles who are 30 
percent or more compensably disabled which must be referred to OPM for 
adjudication, as provided under Pub. L. 95-454.
    (b) Any adjudication by an agency acting under delegated authority 
from OPM which indicates that a general, across agency lines debarment 
by OPM under Sec. 731.204(a) may be an appropriate action should be 
referred to OPM for debarment consideration if not favorably 
adjudicated by the agency. Referral should be made prior to any 
proposed action, but after sufficient resolution of the suitability 
issue(s) through subject contact or investigation to determine if a 
general debarment period appears warranted.
    (c) Agencies exercising authority under this part by delegation 
from OPM must show by policies and records that reasonable methods are 
used to ensure adherence to regulations, standards, and quality control 
procedures established by OPM.
    (d) Before making any applicant suitability determination, the 
agency should first ensure the applicant is eligible for the position, 
among the best qualified, and/or within reach of selection. Because 
suitability issues may not be disclosed until late in the application/
appointment process, only the best qualified should require a 
suitability determination, with appropriate procedures followed and 
appeal rights provided, if suitability issues would form the only basis 
for elimination from further consideration.
    (e) When an agency, exercising authority under this part by 
delegation from OPM, makes an adjudicative decision under this part, or 
changes a tentative favorable placement decision to an unfavorable 
decision, based on an OPM report of investigation or upon an 
investigation conducted pursuant to OPM-delegated authority, the agency 
should:
    (1) Insure that the records used in making the decision are 
accurate, relevant, timely, and complete to the extent reasonably 
necessary to ensure fairness to the individual in any determination;
    (2) Insure that all applicable administrative procedural 
requirements provided by law, the regulations in this part, and OPM 
policy guidance have been observed;
    (3) Consider all available information in reaching its final 
decision, except information furnished by a non-corroborated 
confidential source. Information furnished by a non-corroborated 
confidential source can only be used for limited purposes, such as lead 
information or in interrogatories to a subject if the identity of the 
source is not compromised in any way. An adverse suitability decision 
may not be based on such information; and
    (4) Keep any record of the agency action as required by OPM in its 
supplemental guidance.
    (f) Paragraph (a) of this section notwithstanding, OPM may exercise 
its jurisdiction under this part in any case when it, in its 
discretion, deems necessary.
    (g) Any applicant or appointee who is found unsuitable by any 
agency acting under delegated authority from OPM under this part may 
appeal the adverse suitability decision to the Merit Systems Protection 
Board under the Board's regulations.


Sec. 731.104  Appointments subject to investigation.

    (a) In order to establish an appointee's suitability for employment 
in the competitive service, every appointment to a position in the 
competitive service is subject to investigation by OPM, or an agency 
conducting investigation under delegated authority from OPM, except:
    (1) Promotions;
    (2) Demotions;
    (3) Reassignment;
    (4) Conversion from career-conditional to career tenure;
    (5) Appointment, or conversion to an appointment, involving an 
employee of an agency who has been serving continuously with that 
agency for at least 1 year in one or more positions under an 
appointment subject to investigation; and
    (6) Transfer, provided the individual has served continuously for 
at least 1 year in a position subject to investigation.
    (b) Appointments are subject to investigation to continue OPM's (or 
a delegated agency's) jurisdiction to investigate the suitability of an 
applicant after appointment, and to authorize OPM or an agency acting 
under delegated authority to require removal when it finds the 
appointee unsuitable for Federal employment. The subject to 
investigation condition may not be construed as requiring an employee 
to serve a new probationary or trial period or as extending the 
probationary or trial period of an employee.


Sec. 731.105  Jurisdiction.

    (a) OPM may take a suitability action under this part against an 
applicant or appointee based on any of the criteria of Sec. 731.202;
    (b) An agency, exercising delegated authority, may take a 
suitability action under this part against an applicant or appointee 
based on the criteria of Sec. 731.202 subject to the agency limitations 
prescribed in Sec. 731.103;
    (c) OPM may take a suitability action under this part against an 
employee only in cases involving material, intentional false statement 
or deception or fraud in examination or appointment, or refusal to 
furnish testimony as required by Sec. 5.4 of this chapter, or statutory 
or regulatory bar.
    (d) An agency may not take a suitability action against an employee 
under this part; rather, it may take a suitability action against an 
employee to promote the efficiency of the service under the authority 
and following the procedures of part 752 of this chapter.


Sec. 731.106  Designation of public trust positions and investigative 
requirements.

    (a) Risk designation. Agency heads shall designate every 
competitive service position within the agency at a high, moderate, or 
low risk level as determined by the position's potential for adverse 
impact to the efficiency and integrity of the service. OPM will provide 
an example of a risk designation system for agency use in supplemental 
guidance.
    (b) Public trust positions. Positions at the high or moderate risk 
levels would normally be designated as ``Public Trust'' positions. Such 
positions would involve policy making, major program responsibility, 
public safety and health, law enforcement duties, fiduciary 
responsibilities, or other duties demanding a significant degree of 
public trust; and positions involving access to or operation or control 
of sensitive but unclassified information or financial records, with a 
significant risk for causing damage or realizing personal gain.
    (c) Investigative requirements. Persons receiving an appointment 
made subject to investigation under this part shall undergo a 
background investigation. Minimum investigative requirements 
correlating to risk levels will be established in supplemental guidance 
provided by OPM. Investigations must be initiated before appointment 
or, at most, within 14 calendar days of placement in the position.
    (d) Suitability reinvestigations. Agencies, relying on authorities 
such as the Computer Security Act of 1987 and OMB Circular No. A-130 
Revised (issued February 8, 1996), may require incumbents of certain 
public trust positions to undergo periodic reinvestigations. The 
appropriate level of any reinvestigation will be determined by the 
agency, but may be

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based on supplemental guidance provided by OPM.
    (e) Risk level changes. If the risk level of the position itself is 
changed (e.g., the individual moves from a low risk to a moderate or 
high risk position) the incumbent may remain in the position, but any 
upgrade reinvestigation required by the agency for the new risk level 
should be initiated within 14 calendar days after the new designation 
is final.

Subpart B--Suitability Determinations


Sec. 731.201  Standard.

    Subject to subpart A of this part, an applicant, appointee, or 
employee may be denied Federal employment or removed from a position 
only when the action will protect the integrity or promote the 
efficiency of the service.


Sec. 731.202  Criteria.

    (a) General. In determining whether its action will protect the 
integrity or promote the efficiency of the service, OPM, or an agency 
to which OPM has delegated authority, shall make its determination on 
the basis of the specific factors which follow, with appropriate 
consideration given to the additional considerations outlined in 
paragraph (c) of this section.
    (b) Specific factors. When making a determination under paragraph 
(a) of this section, the following reasons may be considered a basis 
for finding an individual unsuitable:
    (1) Misconduct or negligence in employment;
    (2) Criminal or dishonest conduct;
    (3) Material, intentional false statement or deception or fraud in 
examination or appointment;
    (4) Refusal to furnish testimony as required by Sec. 5.4 of this 
chapter;
    (5) Alcohol abuse of a nature and duration which suggests that the 
applicant or appointee would be prevented from performing the duties of 
the position in question, or would constitute a direct threat to the 
property or safety of others;
    (6) Illegal use of narcotics, drugs, or other controlled 
substances, without evidence of substantial rehabilitation;
    (7) Knowing and willful engagement in acts or activities designed 
to overthrow the U.S. Government by force;
    (8) Any statutory or regulatory bar which prevents the lawful 
employment of the person involved in the position in question.
    (c) Additional considerations. In making a determination under 
paragraphs (a) and (b) of this section, OPM and agencies shall consider 
the following additional considerations to the extent they deem them 
pertinent to the individual case:
    (1) The nature of the position for which the person is applying or 
in which the person is employed;
    (2) The nature and seriousness of the conduct;
    (3) The circumstances surrounding the conduct;
    (4) The recency of the conduct;
    (5) The age of the person involved at the time of the conduct;
    (6) Contributing societal conditions; and
    (7) The absence or presence of rehabilitation or efforts toward 
rehabilitation.


Sec. 731.203  Actions by OPM and other agencies.

    (a) An applicant may be denied employment or an appointee may be 
removed when OPM or an agency exercising delegated authority under this 
part finds that the applicant or appointee is unsuitable for the 
reasons cited in Sec. 731.202 subject to the agency limitations of 
Sec. 731.103(a).
    (b) OPM may require that an employee be removed on the basis of a 
material, intentional false statement, or deception or fraud in 
examination or appointment; or refusal to furnish testimony; or a 
statutory or regulatory bar. OPM may also cancel any reinstatement 
eligibility obtained as a result of false statement, deception or fraud 
in the examination or appointment process.
    (c) An action to remove an appointee or employee for suitability 
reasons under this part is not an action under parts 752 or 315 of this 
chapter, but agencies may use their authority under and follow the 
procedures of parts 752 or 315, as appropriate, in lieu of taking the 
action under this part 731.
    (d) When OPM instructs an agency to remove an appointee or employee 
under this part, it shall notify the agency and the appointee or 
employee of its decision in writing.
    (e) Before OPM, or any agency having delegated authority from OPM 
under this part, shall take a final suitability action against an 
applicant, appointee, or employee under this part, the person against 
whom the action is proposed shall be given notice of the proposed 
action (including the availability for review, upon request, of the 
materials relied upon), an opportunity to respond, notice of the final 
decision on the action, and notice of rights of appeals.
    (f) Agencies are required to report to OPM all unfavorable 
adjudicative actions taken under this part, and all actions based on an 
OPM investigation.


Sec. 731.204  Debarment by OPM.

    (a) When OPM finds a person unsuitable for any reason listed in 
Sec. 731.202, OPM, in its discretion, may deny that person examination 
for, and appointment to, a competitive service position for a period of 
not more than 3 years from the date of determination of unsuitability.
    (b) On expiration of a period of debarment, OPM or an agency may 
redetermine a person's suitability for appointment in accordance with 
the procedures of this part.
    (c) OPM, in its sole discretion, determines the duration of any 
period of debarment imposed under this section.


Sec. 731.205  Debarment by agencies.

    (a) Subject to the provisions of Sec. 731.103, when an agency finds 
an applicant or appointee unsuitable for reasons listed in 
Sec. 731.202, the agency may deny that person examination for, and 
appointment to, all, or specific, competitive service positions within 
the agency for a period of not more than 1 year from the date of 
determination of unsuitability.
    (b) On expiration of a period of agency debarment, the agency may 
redetermine a person's suitability for appointment by the agency, in 
accordance with the procedures of this part.
    (c) The agency is responsible for enforcing the period of debarment 
and taking appropriate action should the individual apply or be 
inappropriately appointed during the debarment period. This does not 
limit OPM's ability to exercise jurisdiction and take an action if it 
deems appropriate.
    (d) The agency, in its sole discretion, determines the duration of 
any period of debarment imposed under this section.

Subpart C--Suitability Action Procedures


Sec. 731.301  Scope.

    (a) Coverage. This subpart sets forth the procedures to be followed 
when OPM or an agency having delegated authority from OPM, acting under 
authority of this part, proposes to take or to instruct an agency to 
take, a final suitability ineligibility action, including removal, 
against an applicant, appointee or employee in the competitive service.
    (b) Definition. In this subpart, days means calendar days.


Sec. 731.302  Notice of proposed action.

    (a) OPM or the agency having delegated authority from OPM under 
this part shall notify the applicant, appointee, or employee 
(hereinafter, the ``respondent'') in writing of the

[[Page 4342]]

proposed action and of the charges against the respondent. The notice 
shall state the reasons, specifically and in detail, for the proposed 
action. The notice shall also state that the respondent has the right 
to answer this notice in writing. If the respondent is an employee, the 
notice shall further state that the employee may also make an oral 
answer, as specified in Sec. 731.303(a). The notice shall further 
inform the respondent of the time limits for response as well as the 
address to which such response should be made.
    (b) The notice of proposed action shall be served upon the 
respondent by being mailed or hand delivered to the respondent's last 
known residence, and/or duty station, no less than 30 days prior to the 
effective date of the proposed action. If the respondent is employed in 
the competitive service on the date the notice is served, the 
respondent shall be entitled to be retained in a pay status during the 
notice period.
    (c) In an OPM action, OPM shall send a copy of this notice to any 
employing agency that is involved.


Sec. 731.303  Answer.

    (a) Respondent's answer. A respondent may answer the charges in 
writing and furnish documentation and/or affidavits in support of the 
response. A respondent who is an employee may also answer orally. The 
respondent may be represented by a representative of the respondent's 
choice, and such representative shall be designated in writing. To be 
timely, a written answer shall be made no more than 30 days after the 
date of the notice of proposed action. In the event an employee 
requests to make an oral answer, the request must be made within this 
30 day time frame, and OPM shall determine the time and place thereof, 
and shall consider any answer the respondent makes in reaching a 
decision.
    (b) Agency's answer. In actions proposed by OPM, the agency may 
also answer the notice of proposed action. The time limit for filing an 
answer is 30 days from the date of the notice. OPM shall consider any 
answer the agency makes in reaching a decision.


Sec. 731.304  Decision.

    The decision shall be in writing, dated, and inform the respondent 
of the reasons for the decision. In an OPM directed removal, the 
employing agency shall remove the appointee or employee from the rolls 
within 5 work days of receipt of OPM's final decision; removals taken 
by an agency under this part should be effected within 5 work days of 
their final decision to remove. The respondent shall also be informed 
that an adverse decision can be appealed in accordance with subpart D 
of this part. In OPM actions, OPM shall also notify the respondent's 
employing agency of its decision.

Subpart D--Appeal to the Merit Systems Protection Board


Sec. 731.401  Appeal to the Merit Systems Protection Board.

    (a) Appeal to the Merit Systems Protection Board. An individual who 
has been found unsuitable for employment may appeal the decision to the 
Merit Systems Protection Board (the Board). However, the Board may not 
modify a debarment period. If the Board finds that fewer than all of 
the charges are supported by a preponderance of the evidence, and 
affirms the determination of unsuitability, it shall remand the case to 
OPM or the agency to determine whether the debarment period is still 
appropriate based on the sustained charges. This subsequent 
determination by OPM or the agency shall be final without any further 
appeal to the Board.
    (b) Appeal procedures. The procedures for filing an appeal with the 
Board are found at part 1201 of Chapter II of this chapter.

Subpart E--Savings Provision


Sec. 731.501  Savings provision.

    No provision of the regulations in this part shall be applied in 
such a way as to affect any administrative proceeding pending on (THE 
EFFECTIVE DATE OF THE FINAL RULE). An administrative proceeding is 
deemed to be pending from the date of the ``notice of proposed action'' 
described in Sec. 731.302.

[FR Doc. 99-1958 Filed 1-27-99; 8:45 am]
BILLING CODE 6325-01-P