[Federal Register Volume 67, Number 25 (Wednesday, February 6, 2002)]
[Notices]
[Pages 5716-5719]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 02-2766]
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Part IV
Department of Defense
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Office of the Secretary
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Science and Technology Reinvention Laboratory Personnel Management
Demonstration Project at the U.S. Army Aviation and Missile Research,
Development, and Engineering Center; Notice
Federal Register / Vol. 67, No. 25 / Wednesday, February 6, 2002 /
Notices
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DEPARTMENT OF DEFENSE
Office of the Secretary
Science and Technology Reinvention Laboratory Personnel
Management Demonstration Project at the U.S. Army Aviation and Missile
Research, Development, and Engineering Center; Notice
AGENCY: Office of the Deputy Assistant Secretary of Defense (Civilian
Personnel Policy), DoD.
ACTION: Notice of amendment of the demonstration project plan.
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SUMMARY: The National Defense Authorization Act for Fiscal Year 1995,
as amended by Section 1114 of the National Defense Authorization Act
for Fiscal Year 2001, authorizes the Secretary of Defense to conduct
personnel demonstration projects at Department of Defense (DoD)
laboratories designated as Science and Technology (S&T) Reinvention
Laboratories. The above-cited legislation authorizes DoD to conduct
demonstration projects that experiment with new and different personnel
management concepts to determine whether such changes in personnel
policy or procedures would result in improved personnel management.
This notice amends the Aviation and Missile Research, Development,
and Engineering Center (AMCOM RDEC) project plan to change the method
for pay setting upon promotion, add a staffing supplement, and make a
technical correction to the categories of participating employees.
DATES: This amendment to the demonstration project plan may be
implemented beginning on the date of publication of this notice in the
Federal Register.
FOR FURTHER INFORMATION CONTACT: AMCOM RDEC: David Knepper, Aviation
and Missile Research, Development, and Engineering Center, U.S. Army
Aviation and Missile Command, ATTN: AMSAM-RD, Redstone Arsenal, Alabama
35898-5000. DoD: Patricia M. Stewart, CPMS-AF, 1400 Key Blvd., Suite B-
200, Arlington, VA 22209-5144.
SUPPLEMENTARY INFORMATION:
1. Background
Final plans were published in the Federal Register for the
following S&T Reinvention Laboratory Demonstration Projects: Missile
Research, Development, and Engineering Center (MRDEC) (Friday, June 27,
1997, Volume 62, Number 124, Part IV, page 34876); and Aviation
Research, Development, and Engineering Center (AVRDEC) (Friday, June
27, 1997, Volume 62, Number 124, Part V, page 34906).
Amendments to the final plans were published in the Federal
Register as follows: To add competitive examining and Distinguished
Scholastic Achievement Appointment authorities as part of the MRDEC and
the AVRDEC plans (Thursday, March 11, 1999, Volume 64, Number 47, page
12216); and to merge the two separate demonstrations into one project
as the AMCOM RDEC (Thursday, August 31, 2000, Volume 65, Number 170,
page 53142).
The AMCOM RDEC demonstration project involves simplified job
classification, paybanding, a performance-based compensation system,
expanded employee development, and revised reduction-in-force
procedures.
2. Overview
Pay setting for promotion is currently achieved by awarding an
employee a 6 percent salary increase or the lowest level in the payband
to which promoted, whichever is greater. In many instances, the
increase has been smaller than what would have been received under
comparable circumstances if the employee were in the General Schedule
(GS) system. For example, an Engineer or Scientist in the demonstration
with a salary equivalent to a GS-13, step 5 would receive a 6 percent
increase upon promotion from payband DB III to DB IV. In the GS system,
the salary increase from GS-13, step 5 to the next grade is 7.74
percent.
The minimum salary increase upon promotion is being changed from 6
percent to 8 percent or the lowest level in the payband to which
promoted, which is more typical of comparable GS increases. Also,
flexibility is being provided to the Personnel Management Board to
raise the minimum increase beyond 8 percent on a case-by-case basis.
The Board will document its rationale for decisions to provide an
increase above 8 percent. This amendment is designed to alleviate a
potential employee retention issue.
A staffing supplement is needed to provide the AMCOM RDEC the
flexibility to remain competitive with special salary rates in the GS
system. Employees assigned to occupational categories and geographic
areas covered by special rates will be entitled to a staffing
supplement if the maximum adjusted rate for the banded GS grades to
which assigned is a special rate that exceeds the maximum GS locality
rate for the banded grades. The staffing supplement serves to
compensate demonstration project employees for the comparable value of
GS special salary rates, removing this as a potential employee hiring
and retention issue.
A technical correction is needed specifically to exclude employees
covered by the Defense Civilian Intelligence Personnel System (DCIPS).
This exclusion was in the AVRDEC Federal Register notice. However, it
was not made part of the MRDEC plan because MRDEC at the time did not
employ DCIPS personnel. The correction is necessary because the two
demonstrations (MRDEC and AVRDEC) have been merged into one and the
MRDEC plan is being followed for the consolidated AMCOM RDEC project.
I. Executive Summary
The Department of the Army established the AMCOM RDEC personnel
demonstration project to be generally similar in nature to the system
in use at the Department of the Navy personnel demonstration project
known as China Lake. The AMCOM RDEC project was built upon the concepts
of linking performance to pay for all covered positions; simplifying
paperwork in the processing of classification and other personnel
actions; emphasizing partnerships among management, employees, and
unions; and delegating authorities to line managers.
II. Introduction
The demonstration project at the AMCOM RDEC intends to provide
managers, at the lowest practical level, the authority, control, and
flexibility needed to achieve a quality laboratory and quality
products. The project will allow the laboratory to compete more
effectively for high-quality personnel and strengthen the manager's
role in personnel management.
A. Purpose
The purpose of this amendment is: (1) To improve pay setting upon
promotion to make it comparable to that received by GS employees by
increasing the promotion salary entitlement from the current 6 percent
or bottom of the payband to which promoted to 8 percent or the bottom
of the payband to which promoted; (2) to allow the Personnel Management
Board to raise the minimum increase upon promotion beyond 8 percent on
a case-by-case basis as described below; (3) to add a staffing
supplement to replace special salary rates that are waived in the
demonstration project; and (4) specifically to exclude employees
covered by the DCIPS from participating
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in the demonstration. Other basic provisions of the approved AMCOM RDEC
demonstration project are unchanged.
B. Employee Notification and Collective Bargaining Requirements
Employee notification will be made by delivery of a copy of this
notice. Supervisors and employees will receive information briefings
and training before implementation. Participating organizations must
fulfill any collective bargaining obligations to unions that represent
employees covered by the demonstration.
III. Personnel System Changes
A. Pay Setting for Promotion
The pay setting for promotion provisions in the MRDEC plan, under
Section III B at page 34888, are amended to read: ``Upon promotion, an
employee will be entitled to an 8 percent increase in base pay or the
lowest level in the payband to which promoted, whichever is greater.
However, for employees assigned to occupational categories and
geographic areas covered by special rates, the minimum salary rate in
the payband to which promoted is the minimum salary for the
corresponding special rate or locality rate, whichever is greater. For
employees covered by a staffing supplement, the demonstration staffing
adjusted pay is considered basic pay for promotion calculations. On a
case-by-case basis, the AMCOM RDEC Personnel Management Board may
approve requests for promotion base pay increases beyond 8 percent, in
accordance with established AMCOM RDEC operating procedures. The Board
will document its rationale for decisions to provide an increase above
8 percent. Highest previous rate may also be considered in setting pay
in accordance with existing pay-setting policies.''
B. Staffing Supplement
The MRDEC plan is amended by adding the following as Section III G,
Staffing Supplement:
Application of the Staffing Supplement Upon Conversion to the
Demonstration Project
Employees assigned to occupational categories and geographic areas
covered by special rates will be entitled to a staffing supplement if
the maximum adjusted rate for the banded GS grades to which assigned is
a special rate that exceeds the maximum GS locality rate for the banded
grades. The staffing supplement is added to base pay, much like
locality rates are added to base pay. For employees being converted
into the demonstration, total pay immediately after implementation of
this intervention will be the same as immediately before this
intervention, but a portion of the total pay will be in the form of a
staffing supplement. Adverse action and pay retention provisions will
not apply to the conversion process, as there will be no change in
total salary. The staffing supplement is calculated as follows:
Upon conversion, the demonstration base rate will be established by
dividing the employee's former GS adjusted rate (the higher of special
rate or locality rate) by the staffing factor. The staffing factor will
be determined by dividing the maximum special rate for the banded
grades by the GS unadjusted rate corresponding to that special rate
(step 10 of the GS rate for the same grade as the special rate). The
employee's demonstration staffing supplement is derived by multiplying
the demonstration base rate by the staffing factor minus one.
Therefore, the employee's final demonstration special staffing rate
equals the demonstration base rate plus the staffing supplement. This
amount will equal the employee's former GS adjusted rate.
Simplified, the formula is this:
Staffing factor = (Maximum special rate for the banded grades)/(GS
unadjusted rate corresponding to that special rate)
Demonstration base rate = (Former GS adjusted rate, special or locality
rate)/(staffing factor)
Staffing supplement = (Demonstration base rate) x (staffing factor
-1)
Salary upon conversion = (Demonstration base rate) + (staffing
supplement) Note: This sum will equal the existing rate.
Example: Assume there is a GS-801-11, step 03, employee stationed
in Huntsville, Alabama, who is entitled to the greater of a special
salary rate of $50,018 or a locality rate of $48,499 ($44,462 + 9.08
percent). The maximum special rate for a GS-801-11, step 10 is $59,741,
and the corresponding regular rate is $54,185. The maximum GS-11
locality rate in Huntsville is $59,105 ($54,185 + 9.08 percent), which
is less than the maximum special salary rate. Thus, a staffing
supplement is payable. The staffing factor is computed as follows:
Staffing factor = $59,741/$54,185 = 1.1025
Demonstration base rate = $50,018/1.1025 = $45,368
Then to determine the staffing supplement, multiply the
demonstration base by the staffing factor minus 1.
Staffing supplement = $45,368 x 0.1025 = $4,650
The staffing supplement of $4,650 is added to the demonstration
base rate of $45,368 and the total salary is $50,018, which is the
salary of the employee before this intervention.
If an employee is in a band where the maximum GS adjusted rate for
the banded grades is a locality rate, when the employee enters into the
demonstration project, the demonstration base rate is derived by
dividing the employee's former GS adjusted rate (the higher of locality
rate or special rate) by the applicable locality pay factor (for
example, 1.0908 in the Huntsville area for CY 2002). The employee's
demonstration locality-adjusted rate will equal the employee's former
GS adjusted rate. Any GS or special rate schedule adjustment will
require computing the staffing supplement again. Employees receiving a
staffing supplement remain entitled to an underlying locality rate,
which may over time supersede the need for a staffing supplement. If
OPM discontinues or decreases a special rate schedule, pay retention
provisions will be applied. Upon geographic movement, an employee who
receives the staffing supplement will have the supplement recomputed.
Any resulting reduction in pay will not be considered an adverse action
or a basis for pay retention.
Application of the Staffing Supplement in Circumstances Other than
Conversion to the Demonstration Project
Calculation of the staffing supplement discussed above was
presented in the context of a General Schedule employee entering the
demonstration project. Application of the staffing supplement is
normally intended to maintain pay comparability for General Schedule
employees entering the demonstration. However, the staffing supplement
formulas must be compatible with non-Government employees entering the
demonstration and also be adaptable to the special circumstances of
employees already in the demonstration. Employees who are already in
the demonstration project and who are in occupational categories
covered by special salary rate tables will have their salaries examined
for the application of a staffing supplement or a one-time salary
adjustment.
The principles in paragraphs 1 through 6 will govern the
modifications necessary to the previous staffing supplement
calculations to apply the staffing supplement to circumstances other
than a General Schedule employee entering the demonstration project. No
adjustment under these provisions will provide an increase greater than
that provided by the special salary rate. An
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increase provided under this authority is not an equivalent increase,
as defined by 5 CFR 531.403. These principles are stated with the
understanding that the necessary conditions exist that require the
application of a staffing supplement.
1. If a non-Government employee is hired into the demonstration,
then the employee's entry salary will be used for the term, ``former GS
adjusted rate'' to calculate the demonstration base rate.
2. If a current demonstration project employee is covered by a
special salary rate table that has not changed (other than by annual
general pay increases), then the employee's current demonstration
adjusted base salary will be used for the term ``former GS adjusted
rate'' to calculate the demonstration base rate.
3. If a current demonstration project employee is covered by a new
or modified special salary rate table, then the employee's current
demonstration base rate is used to calculate the staffing supplement
percentage. The employee's new demonstration adjusted base salary is
the sum of the current demonstration base rate and the calculated
staffing supplement.
4. If a current demonstration project employee is in an
occupational category that is covered by a special salary rate table
and subsequently, the occupational category becomes covered by a
different special salary rate table with a higher value (e.g.; a DB 854
originally covered by table 422 is subsequently covered by table 999B,
which is a higher rate schedule), then the following steps must be
applied to calculate a new demonstration base rate:
Step 1. To obtain a relevance factor, divide the staffing factor
that will become applicable to the employee by the staffing factor that
would have applied to the employee. For example, table 999B (2002 rates
for Huntsville, AL) is applicable to a DB 854-II employee, and the
applicable staffing factor is 1.18 ($63,938/$54,185). For table 0422
(the table that would have applied if table 999B had not been
implemented) the applicable staffing factor is 1.1282 ($61,130/
$54,185). Thus:
Relevance factor = 1.18/1.1282 = 1.0459
Step 2. Multiply the relevance factor resulting from step 1 by the
employee's current adjusted demonstration rate to determine a new
adjusted demonstration rate.
Step 3. Divide the result from step 2 by the applicable staffing
factor to derive a new demonstration base rate. This new demonstration
base rate will be used to calculate the staffing supplement and the new
demonstration adjusted base salary.
5. If, after the establishment of a new or adjusted special salary
rate table, an employee enters the demonstration (whether converted
from the General Schedule or hired from outside Government) prior to
this intervention, then the employee's current adjusted base salary is
used for the term ``former GS adjusted rate'' to calculate the
demonstration base rate. This principle prevents double compensation
due to the single event of a new or adjusted special salary rate table.
6. If an employee is in an occupational category covered by a new
or modified special salary rate table, and the pay band to which
assigned is not entitled to a staffing supplement, then the employee's
salary may be reviewed and adjusted to accommodate the salary increase
provided by the special salary rate. The review may result in a one-
time pay increase if the employee's salary equals or is less than the
highest special salary grade and step that exceeds the comparable
locality grade and step. AMCOM RDEC operating procedures will identify
the officials responsible to make such reviews and determinations. The
applicable salary increase will be calculated by determining the
percentage difference between the highest step 10 special salary rate
and the comparable step 10 locality rate and applying this percentage
to the demonstration base rate.
An established salary including the staffing supplement will be
considered basic pay for the same purposes as a locality rate under 5
CFR 531.606(b), i.e., for purposes of retirement, life insurance,
premium pay, severance pay, and advances in pay. It will also be used
to compute worker's compensation payments and lump-sum payments for
accrued and accumulated annual leave.
Section V of the MRDEC plan, Conversion to the Demonstration
Project, paragraph c is amended to read: ``Employees who are covered by
special salary rates, upon being covered by the demonstration project,
will no longer be considered special rate employees under the
demonstration project. These employees will, therefore, be entitled to
full locality pay or a staffing supplement. The adjusted salaries of
these employees will not change. Rather, the employees will receive a
new basic pay rate computed under the staffing supplement rules in
Section III G, Staffing Supplement, if applicable. Adverse action and
pay retention provisions will not apply to the conversion process, as
there will be no change in total salary.''
Section V of the MRDEC plan, Conversion or Movement from a Project
Position to a General Schedule Position, paragraph a (1), first
sentence is amended to read: ``The employees'' adjusted rate of basic
pay under the demonstration project (including any locality payment or
staffing supplement) is compared with step 4 rates on the highest
applicable GS rate range.'' Paragraph b (2), first sentence is changed
to read: ``An employee's adjusted rate of basic pay under the project
(including any locality payment or staffing supplement) is converted to
the GS adjusted rate on the highest applicable rate range for the
converted GS grade.''
Section IX of the MRDEC plan, Required Waivers to Law and
Regulation, is amended by inserting after the first paragraph, a new
paragraph as follows: ``The following waivers and adaptations of
certain Title 5, U.S.C., provisions are required only to the extent
that these statutory provisions limit or are inconsistent with the
actions contemplated under this demonstration project. Nothing in this
plan is intended to preclude the demonstration project from adopting or
incorporating any law or regulation enacted, adopted, or amended after
the effective date of this demonstration project.''
Section IX is also amended by modifying the existing waiver to
title 5, United States Code, chapter 53, sections 5361-5366, Grade and
pay retention; re-numbering the existing ``(5)'' as ``(6)'; and
inserting a new item ``(5)'' as follows: ``(5) provide that pay
retention provisions do not apply when reduction in basic pay is due
solely to the reallocation of demonstration project pay rates in the
implementation of a staffing supplement'.
Additionally, Section IX is amended by inserting the following
provision above the existing waiver to title 5, United States Code,
chapter 55: ``Chapter 55, Section 5542(a)(1)-(2): Overtime rates;
computation'These sections are adapted only to the extent necessary to
provide that the GS-10 minimum special rate (if any) for the special
rate category to which a project employee belongs is deemed to be the
``applicable special rate'' in applying the pay cap provisions in 5
U.S.C. 5542.''
Section IX is amended by inserting the following provision above
the existing waiver to title 5, United States Code, chapter 57:
``Chapter 55, Section 5547(a)-(b): Limitation on premium pay--These
sections are adapted only to the extent necessary to provide that the
GS-15 maximum special rate (if any) for the special rate category to
which a project employee belongs is deemed to be the ``applicable
special rate'' in
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applying the pay cap provisions in 5 U.S.C. 5547.''
Section IX is further amended by modifying the existing waiver to
title 5, Code of Federal Regulations, part 536; re-numbering the
existing ``(4)'' as ``(5)''; inserting a new item ``(4)'' as follows:
``(4) provide that pay retention provisions do not apply when reduction
in basic pay is due solely to the reallocation of demonstration project
pay rates in the implementation of a staffing supplement'.
Finally, Section IX is amended by inserting the following two
provisions above the existing waiver to title 5, Code of Federal
Regulations, part 550.703:
(1) ``Part 550, sections 550.105 and 550.106: Biweekly and
annual maximum earnings limitations--These sections are adapted only
to the extent necessary to provide that the GS-15 maximum special
rate (if any) for the special rate category to which a project
employee belongs is deemed to be the ``applicable special rate'' in
applying the pay cap provisions in 5 U.S.C. 5547.''
(2) ``Part 550, section 550.113(a): Computation of overtime pay--
This section is adapted only to the extent necessary to provide that
the GS-10 minimum special rate (if any) for the special rate category
to which a project employee belongs is deemed to be the ``applicable
special rate'' in applying the pay cap provisions in 5 U.S.C. 5542.''
C. Participating Employees
The third sentence under Section II E, Participating Employees, of
the MRDEC plan is amended to read: ``Senior Executive Service (SES)
employees and positions, Federal Wage System (FWS) employees, Defense
Civilian Intelligence Personnel System (DCIPS) employees, and employees
in the Quality Assurance Specialist (Ammunition Surveillance) (QASAS)
career program will not be covered in the demonstration project.''
Dated: January 30, 2002.
Patricia L. Toppings,
Alternate OSD Federal Register Liaison Officer, Department of Defense.
[FR Doc. 02-2766 Filed 2-5-02; 8:45 am]
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