[Federal Register Volume 77, Number 118 (Tuesday, June 19, 2012)]
[Notices]
[Pages 36485-36487]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2012-14918]


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DEPARTMENT OF COMMERCE

National Institute of Standards and Technology

[Docket Number 120531129-2129-01]


Alternative Personnel Management System (APMS) at the National 
Institute of Standards and Technology

AGENCY: National Institute of Standards and Technology, Department of 
Commerce.

ACTION: Notice of Modifications with Request for Comment.

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SUMMARY: This notice changes the National Institute of Standards and 
Technology's (NIST) Alternative Personnel Management System (APMS) 
published October 21, 1997 (62 FR 54604, 54606), May 6, 2005 (70 FR 
23996), July 15, 2008 (73 FR 40500), and July 21, 2009 (74 FR 35841 and 
74 FR 35843) to (1) eliminate the required bonus for employees at the 
cap of their pay band who are appraised at the top two rating levels, 
and (2) solidify the three-year probationary period, a hallmark of the 
original NIST demonstration project and later APMS.

DATES: This notice is effective on June 19, 2012. Comments will be 
accepted until 5:00 p.m. Eastern Time on July 19, 2012.

ADDRESSES: Send or deliver comments to Amy K. Cubert, Supervisory Human 
Resources Specialist, National Institute of Standards and Technology, 
Building 101, Room A-123, 100 Bureau Drive Mail Stop 1720, 
Gaithersburg, MD 20899-1720, Fax: (301) 948-6107 or email comments to 
[email protected].

FOR FURTHER INFORMATION CONTACT: For questions or comments, please 
contact Amy K. Cubert at the National Institute of Standards and 
Technology, (301) 975-3006.

SUPPLEMENTARY INFORMATION: 

Background

    In accordance with Public Law 99-574, the National Bureau of 
Standards Authorization Act for fiscal year 1987, the Office of 
Personnel Management (OPM) approved a demonstration project plan, 
``Alternative Personnel Management System (APMS) at the National 
Institute of Standards and Technology (NIST),'' and published the plan 
in the Federal Register on October 2, 1987 (52 FR 37082). The published 
demonstration project plan was modified twice to clarify certain NIST 
authorities (54 FR 21331 of May 17, 1989, and 55 FR 39220 of September 
25, 1990). The project plan and subsequent amendments were consolidated 
in the final APMS plan, which became permanent on October 21, 1997 (62 
FR 54604). NIST published three subsequent amendments to the final APMS 
plan: One on May 6, 2005 (70 FR 23996), which became effective upon 
publication in the Federal Register; one on July 15, 2008 (73 FR 
40500), which became effective on October 1, 2008; and one on July 21, 
2009 (74 FR 35841), which became effective upon publication in the 
Federal Register. NIST also published a correction on July 21, 2009 (74 
FR 35843), which became effective upon publication in the Federal 
Register.
    The final APMS plan, as amended, provides for modifications to be 
made as experience is gained, results are analyzed, and conclusions are 
reached on how the system is working. This notice formally modifies the 
APMS plan to (1) eliminate the mandatory minimum bonus for pay-capped 
employees receiving either a Superior Contributor or Exceptional 
Contributor rating of record, and (2) to solidify the three-year 
probationary period, a feature of the original demonstration project 
and subsequent Alternative Personnel Management System, for employees 
in the Scientific and Engineering career path hired into the Excepted 
and Competitive Service. Comments will be considered and any changes 
deemed necessary will be made.

    Dated: June 13, 2012.
David Robinson,
Associate Director for Management Resources.

Table of Contents

I. Executive Summary
II. Basis for APMS Plan Modification
III. Changes to the APMS Plan

I. Executive Summary

    The National Institute of Standards and Technology's (NIST) 
Alternative Personnel Management System (APMS) is designed to: (1) 
Improve hiring and allow NIST to compete more effectively for high-
quality researchers through direct hiring, selective use of higher-
entry salaries, and selective use of recruiting allowances; (2) 
motivate and retain staff through higher pay potential, a pay-for-
performance system, more responsive personnel systems, and selective 
use of retention allowances; (3) strengthen the manager's role in 
personnel management through delegation of personnel authorities; and 
(4) increase the efficiency of personnel systems through installation 
of a simpler and more flexible classification system based on pay 
banding through reduction of guidelines, steps, and paperwork in 
classification, hiring, and other personnel systems, and through 
automation (52 FR 37082, October 2, 1987). Since implementing the APMS, 
NIST is more competitive for talent, and NIST managers report 
significantly more authority to make decisions concerning employee pay.
    This amendment seeks to better ensure fiscal responsibility and 
budget accountability within the pay-for-performance component of the 
APMS. It also seeks to ensure that management has the ability to 
adequately evaluate its scientific and engineering professional 
employees for research results, which may take longer than one year.
    NIST's APMS performance rating system is a pay-for-performance 
system in which eligible employees may receive pay increases and 
bonuses based on performance. Pay increases are based on an annually 
determined percentage of the mid-point salary for each pay band in a 
career path and linked directly to the top four performance ratings. 
One of the characteristics of the NIST APMS performance management 
system is a required bonus for high-performing employees who cannot 
receive a pay increase because they are at the top of their pay band. 
Specifically, salary-capped employees receiving a Superior Contributor 
or Exceptional Contributor rating must receive a bonus at least 
equivalent to the salary increase that they would have received if 
their salaries were not capped.
    Another feature of NIST's APMS is an extended probationary period 
of up to three years for employees in the Scientific and Engineering 
career path (classified as ``ZP''). The extended probationary period 
was an original component of the NIST Demonstration Project and later 
in the APMS. The purpose of the extended probationary period was to 
allow more time to assess scientific and engineering professionals 
because research results can often be

[[Page 36486]]

difficult to evaluate in one year. Since the finalizing of the NIST 
APMS in 1997, the United States Court of Appeals for the Federal 
Circuit decided two cases, Van Wersch v. Department of Health & Human 
Services, 197 F.3d 1144 (Fed. Cir. 1999), and McCormick v. Department 
of the Air Force, 307 F.3d 1339 (Fed. Cir. 2002), which affected NIST's 
ability to fully utilize its extended probationary period.
    This amendment modifies the APMS Plan, which was last amended in 
July 2009. Specifically, NIST will eliminate the mandatory minimum 
bonus for employees who are appraised at the top two rating levels, 
``Superior Contributor'' and ``Exceptional Contributor.'' It will also 
identify waiver language needed to retain the original system feature 
of an extended probationary period of up to three years for employees 
in the Scientific and Engineering career path hired into the Excepted 
and Competitive Service. NIST will continually monitor the 
effectiveness of this amendment.

II. Basis for APMS Plan Modification

A. Performance Bonuses

    The need to modify the current NIST APMS Pay for Performance System 
(PPS) surfaced in early 2011 after the implementation of a two-year pay 
freeze for Federal employees and the budget crisis that was resolved to 
narrowly avert a government shutdown. These actions reinforced the 
uncertainty of the budget for NIST, and, without additional funding for 
bonuses and pay increases, NIST realized that measures had to be taken 
to ensure fiscal responsibility in the application of its PPS.
    Subsequently, in June 2011, the Office of Management and Budget 
(OMB) and the Office of Personnel Management (OPM) issued a memorandum 
titled ``Guidance on Awards for Fiscal Years 2011 and 2012,'' \1\ 
implementing budgetary limits on monetary awards, which had a 
significant impact on NIST's PPS. In response to these limitations, in 
August 2011, the Performance Management Board (PMB), responsible for 
governing and overseeing NIST's APMS, decided to exercise its authority 
and approved an exception to normal procedures that suspended the 
mandatory minimum bonus for pay-capped employees who received 
Exceptional Contributor and Superior Contributor ratings in Fiscal Year 
2011. As a result, all performance bonuses in FY11 were granted on a 
discretionary basis, subject to management controls to ensure that 
higher-rated employees in the same career path and pay band received 
commensurate bonuses.
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    \1\ http://www.chcoc.gov/transmittals/TransmittalDetails.aspx?TransmittalID=3997.
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    In an effort to more closely align NIST's APMS performance system 
with the Administration's focus on fiscal responsibility and careful 
management of all resources, NIST is amending the provisions of the 
APMS to remove the requirement that a salary-capped employee with an 
Exceptional Contributor or Superior Contributor rating must receive a 
bonus at least equivalent to the salary increase that would have been 
received if the employee's salary were not capped.

B. Three-Year Probationary Period

    Since its inception in 1987, NIST has had a provision, first in its 
OPM-approved Demonstration Project and later in its approved APMS, for 
an extended probationary period of up to three years for employees in 
the Scientific and Engineering career path (ZP). Appropriate waivers of 
laws, rules, and regulations were made at the time. Since then, the 
Federal Circuit issued two decisions (noted above) that affected NIST's 
ability to fully exercise the extended probationary period. This notice 
amends the APMS by identifying the appropriate waivers to permit NIST 
to apply an extended probationary period of up to three years to 
employees in the Scientific and Engineering career path.

III. Changes in the APMS Plan

    The APMS at NIST, published in the Federal Register on October 21, 
1997 (62 FR 54604), May 6, 2005 (70 FR 23996), July 15, 2008 (73 FR 
40500), and July 21, 2009 (74 FR 35841 and 74 FR 35843), is amended as 
follows:
    1. Performance Bonuses: The subsection titled ``Performance 
Bonuses'' (70 FR 23996, 23999, May 6, 2005) is deleted in its entirety 
and replaced with the following:

``Performance Bonuses''

    Bonuses are the only cash awards linked to the NIST APMS pay-for-
performance system. They are awarded at the end of the performance 
rating period and may be granted in conjunction with performance pay 
increases. A pay pool manager may award a bonus to any employee with a 
performance rating of Contributor or higher. A pay pool manager is a 
line manager who manages his or her organization's pay increase and 
bonus fund and has final decision authority over the performance 
ratings and bonuses of subordinate employees.''
    2. Authorities and Waiver of Laws and Regulations Required: The 
subsection titled ``Authorities and Waiver of Laws and Regulations 
Required'' (62 FR 54604, 54613, October 21, 1997) is deleted in its 
entirety and replaced with the following:
    ``Authorities and Waiver of Laws and Regulations Required'' Public 
Law 99-574 gave the National Institute of Standards and Technology 
(NIST) the authority to experiment with several specific personnel 
system innovations which are otherwise prohibited by law and 
regulations. In addition to the authorities granted by the original 
NIST project legislation, the following waivers of law and regulation 
are included:

Title 5, U.S. Code

     Section 5304, Locality-based comparability payments.
     Section 5333, Minimum rate for new appointments.
     Section 5753-5754, except that relocation bonuses under 
section 5753 continue to apply.
     Subchapter VI of Chapter 53 Grade and Pay Retention, (To 
the extent necessary to allow the following modifications: (1) Pay 
retention does not apply to reductions in pay caused solely by 
geographic movement; and (2) pay retention does not apply to 
conversions to the General Schedule as long as the employee's total 
rate of pay is not reduced).
     Section 7501(1), Adverse actions. (waiving the language 
``or who has completed 1 year of current continuous employment in the 
same or similar positions under other than a temporary appointment 
limited to 1 year or less;'' waived only for positions in the 
Scientific and Engineering Career path).
     Sections 7511(a)(1)(ii), 7511(a)(1)(B), 7511(a)(1)(C)(ii), 
Adverse actions (waived only for positions in the Scientific and 
Engineering Career path).
     Section 7512(4), Adverse actions, (To the extent necessary 
to allow the following modifications: (1) Exclude reductions in pay 
that are solely due to recomputation upon geographic movement; and (2) 
exclude conversions to the General Schedule that do not result in a 
reduction in the employee's total rate of pay).

Title 5, Code of Federal Regulations

     Sections 315.801, Probationary period; when required, 
(waived only for positions in the Scientific and Engineering Career 
path).
     Section 315.802, Length of probationary period, (waived 
only for positions in the Scientific and Engineering Career path).

[[Page 36487]]

     Section 315.803(b), Agency action during probationary 
period (general) (waived only for positions in the Scientific and 
Engineering Career path).
     Section 315.805, Termination of probationers for 
conditions arising before appointment (waived only for positions in the 
Scientific and Engineering Career path).
     Section 315.806, Appeal rights to the Merit Systems 
Protection Board (waived only for employees in the Scientific and 
Engineering Career path serving a probationary or trial period).
     Section 351.401, Determining Retention Standing.
     Section 351.402, Competitive area in RIF.
     Section 351.403, Competitive level in RIF.
     Sections 351.504(a) and (d), Credit for Performance.
     Section 351.701, Assignment involving displacement.
     Section 531.203, Minimum rate for new appointments.
     Part 575, Subpart A Recruitment Bonuses.
     Part 575, Subpart C Retention Allowances.
     Sections 752.401(c)(2), 752.401(c)(3), 752.401(c)(5), 
Coverage (waived only for positions in the Scientific and Engineering 
Career path). Department Administrative Orders.
     Section 202-302, Employment in the Excepted Service 
(waived to the extent inconsistent with the APMS).
     Section 202-315, Probationary and Trial Periods (waived to 
the extent inconsistent with the APMS).

[FR Doc. 2012-14918 Filed 6-18-12; 8:45 am]
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