[Federal Register Volume 68, Number 23 (Tuesday, February 4, 2003)]
[Rules and Regulations]
[Pages 5529-5530]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 03-2766]



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 Rules and Regulations
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  Federal Register / Vol. 68, No. 23 / Tuesday, February 4, 2003 / 
Rules and Regulations  

[[Page 5529]]



OFFICE OF PERSONNEL MANAGEMENT

5 CFR Part 576

RIN 3206-AJ76


Voluntary Separation Incentive Payments

AGENCY: Office of Personnel Management.

ACTION: Interim rulemaking.

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SUMMARY: The Office of Personnel Management (OPM) is issuing interim 
regulations on voluntary separation incentive payments (i.e., 
``buyouts''). These regulations implement the voluntary separation 
incentive payment provisions of the Homeland Security Act of 2002, 
Public Law 107-296, which apply to most executive branch agencies.
    These interim regulations explain how an agency requests authority 
from OPM to offer voluntary separation incentive payments. They also 
explain how in exceptional circumstances an agency that is hiring a 
former employee who previously received a voluntary separation 
incentive payment may request that OPM waive the general requirement 
that the individual repay the incentive.

DATES: These regulations are effective February 4, 2003. OPM will 
consider written comments if received no later than April 7, 2003.

ADDRESSES: Send written comments to Ellen E. Tunstall, Assistant 
Director for Employment Policy, Office of Personnel Management, Room 
6500, 1900 E Street, NW., Washington, DC 20415.

FOR FURTHER INFORMATION CONTACT: Charles W. Gray at 202-606-0960, FAX 
at 202-606-2329, TDDY at 202-418-3134, or e-mail at [email protected].

SUPPLEMENTARY INFORMATION: Section 1313(a) of the ``Homeland Security 
Act of 2002'' (Public Law 107-296, 116 Stat. 2135) amends chapter 35 of 
title 5, United States Code, to allow executive branch agencies, at 
their option, to offer voluntary separation incentive payments to 
surplus or displaced employees who separate by voluntary retirement or 
by resignation. To offer buyouts, an agency must submit a plan for OPM 
approval. The plan must describe how the agency will use voluntary 
separation incentive payments as a tool to facilitate its restructuring 
goals. OPM will review each agency's plan and, in consultation with the 
Director of the Office of Management and Budget, may make any 
appropriate modifications to the agency's plan for voluntary separation 
incentive payments. The agency must have OPM approval before using this 
flexibility.
    New subpart A of 5 CFR part 576 implements these new voluntary 
separation incentive payment provisions, which are codified in sections 
3521 through 3523 of title 5, United States Code.
    A former employee who accepts any employment with the Government of 
the United States for compensation within 5 years after the date of 
separating for a voluntary separation incentive payment must repay the 
entire amount of the incentive payment before the first day of 
reemployment in the Federal service. Under exceptional circumstances, 
the OPM Director may, at the request of the hiring agency, waive the 
repayment requirement for former executive branch employees.
    New subpart B of 5 CFR part 576 covers both the general repayment 
requirement and the limited waiver provision of the Act, which are 
codified in section 3524 of title 5, United States Code.
    OPM is continuing to collect data related to this program, both for 
oversight purposes and to evaluate the effectiveness of the program.
    These regulations are published in response to the amendment of 
chapter 35 of title 5, United States Code, which relates to voluntary 
separation incentive payments. They are effective on January 24, 2003, 
as provided in section 1313(a)(4) of Public Law 107-296.

Waiver of Notice of Proposed Rulemaking and Delay in Effective Date

    Pursuant to section 553(b)(3)(B) of title 5, United States Code, I 
find that good cause exists for waiving the general notice of proposed 
rulemaking because it would be contrary to the public interest to delay 
implementing management flexibilities which are provided by law. 
Section 1313(a)(4) of Public Law 107-296 provides that all of the 
provisions in the Department of Homeland Security Act of 2002 relating 
to voluntary separation incentive payments are effective 60 days from 
the date of enactment of the law. The law was enacted November 25, 
2002.

Regulatory Flexibility Act

    I certify that this regulation will not have a significant economic 
impact on a substantial number of small entities because it affects 
only certain 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 in 5 CFR Part 576

    Government employees, wages.

Office of Personnel Management.
Kay Coles James,
Director.


    Accordingly, OPM is revising part 576 of title 5, Code of Federal 
Regulations, to read as follows:

PART 576--VOLUNTARY SEPARATION INCENTIVE PAYMENTS

Subpart A--Voluntary Separation Incentive Payments

Sec.
576.101 Definitions.
576.102 Voluntary separation incentive payment implementation plans.
576.103 Offering voluntary separation incentive payments to 
employees.
576.104 Additional agency requirements.
576.105 Existing voluntary separation incentive payment authorities.

Subpart B--Waiver of Repayment of Voluntary Separation Incentive 
Payments

Sec.
576.201 Definitions.
576.202 Repayment requirement.
576.203 Waivers of the voluntary separation incentive repayment 
requirement.

    Authority: 5 U.S.C. 3521, 3522, 3523, 3524, and 3525.

[[Page 5530]]

Subpart A--Voluntary Separation Incentive Payments.


Sec.  576.101  Definitions.

    Section 3521(1) of title 5, United States Code, contains the 
definition of Agency, and section 3521(2) of title 5, United States 
Code, contains the definition of Employee, as used in this subpart.


Sec.  576.102  Voluntary separation incentive payment implementation 
plans.

    (a) Section 3522 of title 5, United States Code, specifies the 
information that the head of an agency must submit to the Office of 
Personnel Management (OPM). OPM will consult with the Office of 
Management and Budget (OMB) regarding the plan and will notify the 
agency head in writing when the plan is approved. The agency must have 
OPM approval before offering incentives under this authority.
    (b) In submitting a plan to OPM under section 3522(a) of title 5, 
United States Code, the head of an agency may submit:
    (1) A specific voluntary separation incentive payment 
implementation plan outlining the intended use of the incentive 
payments, or
    (2) The agency's human capital plan, which outlines the intended 
use of the incentive payments and the expected changes in the agency's 
organizational structure after the agency has completed the incentive 
payments.
    (c) In either case, the plan must include:
    (1) Identification of the specific positions and functions to be 
reduced or eliminated, identified by organizational unit, geographic 
location, occupational category, grade level and any other factors 
related to the position, such as skills and knowledge;
    (2) A description of the categories of employees who will be 
offered incentives identified by organizational unit, geographic 
location, occupational category, grade level and any other factors, 
such as skills, knowledge, or retirement eligibility;
    (3) The time period during which incentives may be paid;
    (4) The number and maximum amounts of voluntary separation 
incentive payments to be offered;
    (5) A description of how the agency will operate without the 
eliminated or restructured positions and functions;
    (6) A proposed organizational chart displaying the expected changes 
in the agency's organizational structure after the agency has completed 
the incentive payments; and
    (7) If the agency has requested, or will request Voluntary Early 
Retirement Authority, a description of how that authority will be used 
in conjunction with separation incentives;
    (8) If the agency is offering separation incentives under any other 
statutory authority, a description of how that authority is being used.


Sec.  576.103  Offering voluntary separation incentive payments to 
employees.

    Section 3523 of title 5, United States Code, covers:
    (a) The basis for an agency to offer a voluntary separation 
incentive payment;
    (b) The computation of a voluntary separation incentive payment; 
and
    (c) The appropriations or funds that the agency uses to pay the 
voluntary separation incentive payment.


Sec.  576.104  Additional agency requirements.

    (a) After OPM approves an agency's plan for voluntary separation 
incentive payments, the agency is required to immediately notify OPM of 
any subsequent changes in the conditions that served as the basis for 
the approval of the voluntary separation incentive payments. OPM will 
consult with OMB and notify the agency in writing if there are changes 
in the OPM approval of the agency plan.
    (b) Agencies are required to provide OPM with interim and final 
voluntary separation incentive payment reports, as covered in OPM's 
approval letter to the agency. OPM may suspend or cancel a voluntary 
separation incentive payment authority if the agency is not in 
compliance with the reporting requirements or reporting schedule 
specified in OPM's letter approving that authority.


Sec.  576.105  Existing voluntary separation incentive payment 
authorities.

    As provided in section 1313(a)(3) of Public Law 107-296, any agency 
exercising voluntary separation incentive authority in effect on 
January 24, 2003, may continue to offer voluntary separation incentives 
consistent with that authority until that authority expires. An agency 
that is eligible to offer voluntary separation incentive payments under 
this authority and under any other statutory authority may choose which 
authority it wishes to use, or offer incentives under both.

Subpart B--Waiver of Repayment of Voluntary Separation Incentive 
Payments


Sec.  576.201  Definitions.

    Section 3524(a) of title 5, United States Code, contains the 
definition of Employment as used in this subpart.


Sec.  576.202  Repayment requirement.

    (a) Section 3524(b) of title 5, United States Code, contains the 
repayment requirement that applies if an executive branch employee who 
received a voluntary separation incentive payment as described in 
subpart A of this part, and accepts any employment for compensation 
with the Government of the United States within 5 years after the date 
of the separation on which the payment is based. The individual must 
repay the entire amount of the voluntary separation incentive payment 
to the agency that paid the voluntary separation incentive payment 
before the individual's first day of reemployment.
    (b) An executive branch employee who received a voluntary 
separation incentive payment on or after March 30, 1994, under 
statutory authority other than subpart A of this part, and who accepts 
any employment for compensation with the Government of the United 
States within 5 years after the date of the separation on which the 
payment is based, may be required by the authorizing statute to repay 
the entire amount.


Sec.  576.203  Waivers of the voluntary separation incentive repayment 
requirement.

    (a)(1) Section 3524(c)(1) of title 5, United States Code, covers 
the conditions under which the Director of OPM may, at the request of 
the head of the hiring agency, waive the repayment required in Sec.  
576.202.
    (2) Section 3524(a)(2) of title 5, United States Code, provides 
that the waiver provision under section 3524(c)(1) of title 5, United 
States Code, does not extend to a repayment obligation resulting from 
employment under a personal services contract or other direct contract.
    (b) For a voluntary separation incentive payment made under 
statutory authority other than subpart A of this part, the agency 
should review the authorizing statute and, if a waiver is permitted, 
submit a request as specified by that statute.

[FR Doc. 03-2766 Filed 1-31-03; 2:50 pm]
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