[Federal Register Volume 88, Number 219 (Wednesday, November 15, 2023)]
[Proposed Rules]
[Pages 78243-78249]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2023-25199]
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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. 88, No. 219 / Wednesday, November 15, 2023 /
Proposed Rules
[[Page 78243]]
OFFICE OF PERSONNEL MANAGEMENT
5 CFR Part 575
[Docket ID: OPM-2023-0027]
RIN 3206-AO36
Recruitment and Relocation Incentive Waivers
AGENCY: Office of Personnel Management.
ACTION: Proposed rule.
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SUMMARY: The Office of Personnel Management (OPM) is issuing a proposed
rule to expand the authority to approve waivers of the normal payment
limitations on recruitment and relocation incentives. An expansion of
the waiver approval authority would provide agencies with access to
higher payment limitations for these flexibilities without requesting
approval from OPM. Under this proposed rule, agencies would have the
authority to approve a recruitment or relocation incentive of up to 50
percent of an employee's annual rate of basic pay multiplied by the
number of years in a service agreement (not to exceed 100 percent of
annual basic pay) based on a critical agency need. In addition, this
proposed rule would give agencies flexibility to set the length of the
required service period for recruitment incentives to a period less
than 6 months but not more than 4 years, which would align the service
requirements for recruitment incentives with those for relocation
incentives and provide agencies with additional flexibility in taking
advantage of this incentive as a recruitment tool.
DATES: Comments must be received on or before January 16, 2024.
ADDRESSES: You may submit comments, identified by the Regulation
Identifier Number (RIN) number ``3206-AO36'' and title, using the
following method:
Federal Rulemaking Portal: https://www.regulations.gov.
Follow the instructions for submitting comments.
The general policy for comments and other submissions from members
of the public is to make these submissions available for public viewing
at https://www.regulations.gov as they are received without change,
including any personal identifiers or contact information.
FOR FURTHER INFORMATION CONTACT: Gene Holson by telephone at (202) 606-
2858 or by email at [email protected].
SUPPLEMENTARY INFORMATION:
Background
Section 101 of the Federal Workforce Flexibility Act of 2004 (Act)
(Pub. L. 108-411, October 30, 2004) amended 5 U.S.C. 5753 and 5754 by
providing enhanced authorities to pay recruitment, relocation, and
retention incentives. Congress originally provided the authority to pay
such incentives under the Federal Employees Pay Comparability Act of
1990 (Pub. L. 101-509, November 5, 1990). In the 2004 Act, Congress
expanded the circumstances under which these flexibilities may be paid
and enabled agencies to make the payments in more ways to enhance their
desired effect in assisting Federal agencies' efforts to recruit and
retain the kind of workforce needed in the 21st century. OPM's
regulations at 5 CFR part 575, subparts A, B, and C, implement these
authorities. This rulemaking proposes changes to the recruitment
incentive regulations at 5 CFR part 575, subpart A, and relocation
incentive regulations at 5 CFR part 575, subpart B, to provide agencies
additional payment options. To differentiate these kinds of payments--
which are designed to provide a monetary incentive for an individual to
accept a new position, as opposed to rewarding an individual for
quality of performance (the typical context in which the term ``bonus''
is used)--OPM's regulations use the term ``incentive'' in place of the
term ``bonus,'' which is used in the statute.
Recruitment Incentives
Under 5 U.S.C. 5753 and 5 CFR part 575, subpart A, an agency may
pay a recruitment incentive to an employee newly appointed to a General
Schedule or other covered position in the Federal service when the
agency determines the position is likely to be difficult to fill in the
absence of an incentive. The employee must sign an agreement to fulfill
a period of service with the agency. A recruitment incentive may not
exceed 25 percent of the employee's annual rate of basic pay in effect
at the beginning of the service period, multiplied by the number of
years (including fractions of a year) in the service period (not to
exceed 4 years). Currently, this cap may be increased to up to 50
percent with OPM approval, based on a critical agency need, as long as
the total incentive does not exceed 100 percent of the employee's
annual rate of basic pay. A recruitment incentive may be paid as an
initial lump-sum payment at the beginning of the service period, in
installments throughout the service period, as a final lump-sum payment
upon completion of the service period, or in a combination of these
methods. (See 5 CFR 575.109.)
Before paying a recruitment incentive, an agency must establish a
recruitment incentive plan. (See 5 CFR 575.107(a).) The plan must
include the designation of officials with authority to review and
approve the payment of recruitment incentives, the designation of
officials with authority to waive the repayment of a recruitment
incentive, the categories of employees who may not receive recruitment
incentives, the required documentation for determining that a position
is likely to be difficult to fill, requirements for determining the
amount of a recruitment incentive, the payment methods that may be
authorized, requirements governing service agreements (including
criteria for determining the length of a service period, the conditions
for terminating a service agreement, and the obligations of the agency
and the employee if a service agreement is terminated), and
documentation and recordkeeping requirements. Unless the head of the
agency determines otherwise, an agency recruitment incentive plan must
apply uniformly across the agency. (See 5 CFR 575.107(c).)
For each determination to pay a recruitment incentive, an agency
must document, in writing, the basis for determining that the position
is likely to be difficult to fill in the absence of a recruitment
incentive, the amount and timing of the incentive payments, and the
length of the service period. The determination to pay a recruitment
incentive must be made before the prospective employee enters on duty
in
[[Page 78244]]
the position for which they are recruited. The authorized agency
official must review and approve the recruitment incentive
determination before the agency pays the incentive to the employee.
(See 5 CFR 575.107(b), 575.108.) Payment of a recruitment incentive is
subject to the aggregate limitation on pay under 5 CFR part 530,
subpart B. (See 5 CFR 575.109(f).)
An agency may determine that a position is likely to be difficult
to fill if the agency is likely to have difficulty recruiting
candidates with the competencies (i.e., knowledge, skills, abilities,
behaviors, and other characteristics) required for the position (or
group of positions) in the absence of a recruitment incentive based on
a consideration of the factors listed in 5 CFR 575.106(b). An agency
also may determine that a position is likely to be difficult to fill if
OPM has approved the use of a direct-hire authority applicable to the
position. (See 5 CFR 575.106(c).) The use of recruitment incentives can
help agencies expand applicant pools to include more diverse
candidates.
Before receiving a recruitment incentive, an employee must sign a
written agreement to complete a specified period of employment with the
agency of not less than 6 months. The service agreement must specify
the length, commencement date, and termination date of the service
period; the total amount of the incentive; the method, timing, and
amounts of incentive payments; the conditions under which an agreement
will be terminated by the agency; any agency or employee obligations if
a service agreement is terminated (including the conditions under which
the employee must repay an incentive or under which the agency must
make additional payments for partially completed service); and any
other terms and conditions for receiving and retaining a recruitment
incentive. (See 5 CFR 575.110.) OPM has provided a fact sheet with
additional information on recruitment incentives.\1\
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\1\ Office of Personnel Management. ``Fact Sheet: Recruitment
Incentives.'' https://www.opm.gov/policy-data-oversight/pay-leave/recruitment-relocation-retention-incentives/fact-sheets/recruitment-incentives/.
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Relocation Incentives
Under 5 U.S.C. 5753 and 5 CFR part 575, subpart B, an agency may
pay a relocation incentive to a current employee who must relocate to
accept a General Schedule or other covered position in a different
geographic area (permanently or temporarily) if the agency determines
that the position is likely be difficult to fill in the absence of an
incentive. (See 5 CFR 575.205(a).) A relocation incentive may be paid
only when the employee's rating of record under an official performance
appraisal or evaluation system is at least ``Fully Successful'' or
equivalent. (See 5 CFR 575.205(c).) Like a recruitment incentive, a
relocation incentive may not exceed 25 percent of the employee's annual
rate of basic pay in effect at the beginning of the service period
multiplied by the number of years (including fractions of a year) in
the service period (not to exceed 4 years). With OPM approval, this cap
may be raised to up to 50 percent (based on a critical agency need), as
long as the total incentive does not exceed 100 percent of the
employee's annual rate of basic pay at the beginning of the service
period. The incentive may be paid as an initial lump-sum payment at the
beginning of the service period, in installments throughout the service
period, as a final lump-sum payment upon completion of the service
period, or in a combination of these methods. (See 5 CFR 575.209.)
Before paying a relocation incentive, an agency must establish a
relocation incentive plan. A relocation incentive plan must generally
address the same information required in a recruitment incentive plan,
as described above. (See 5 CFR 575.207.)
For each relocation incentive authorized, an agency must document
in writing the justification for approving the incentive that addresses
factors similar to those needed for recruitment incentive
authorizations, as described above. The agency must also document that
the worksite of the new position is in a different geographic area than
the previous position. The determination to pay a relocation incentive
must be made before the employee enters on duty in the position at the
new duty station. The authorized agency official must review and
approve the relocation incentive determination before the agency pays
the incentive to the employee. (See 5 CFR 575.207(b), 575.208.) Agency
determinations to pay a relocation incentive must generally be made on
a case-by-case basis. (See 5 CFR 575.208.) Payment of a relocation
incentive is subject to the aggregate limitation on pay under 5 CFR
part 530, subpart B. (See 5 CFR 575.209(e).)
The factors an agency may consider in determining that the new
position is likely to be difficult to fill in the absence of a
relocation incentive are also similar to those that may be considered
for recruitment incentives. (See 5 CFR 575.206(b).) The use of
relocation incentives can help agencies expand applicant pools to
include more diverse candidates. Before receiving a relocation
incentive, an employee must sign a written agreement to complete a
specified period of employment with the agency at the new duty station
(not to exceed 4 years). The relocation incentive service agreement
requirements and payment termination provisions are consistent with
those required for recruitment incentives, except there is no minimum
service period required. (See 5 CFR 575.210 and 575.211.) OPM has
provided a fact sheet with additional information on relocation
incentives.\2\
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\2\ Office of Personnel Management. ``Fact Sheet: Relocation
Incentives.'' https://www.opm.gov/policy-data-oversight/pay-leave/recruitment-relocation-retention-incentives/fact-sheets/relocation-incentives/.
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Recruitment and Relocation Incentive Waivers
Agencies currently have the authority to approve a recruitment or
relocation incentive without OPM approval for payments of up to 25
percent of an employee's annual rate of basic pay times the number of
years in a service agreement (not to exceed 4 years or 100 percent of
annual basic pay). However, OPM approval is required when an agency
would like to exceed this payment limit to make larger payments over
shorter service agreement lengths. Under a recruitment or relocation
incentive waiver, agencies can approve a recruitment or relocation
incentive of up to 50 percent of an employee's annual rate of basic pay
times the number of years in a service agreement (not to exceed 100
percent of annual basic pay). (See 5 CFR 575.109(c) and 575.209(c).)
For example, an OPM waiver is not required for an agency to pay a
recruitment or relocation incentive of up to 25 percent of annual basic
pay for a 1-year service agreement, 50 percent of basic pay for a 2-
year service agreement, or 100 percent of basic pay for a 4-year
service agreement. An OPM waiver currently is required for an agency to
pay a recruitment or relocation incentive of 50 percent of annual basic
pay for a 1-year service agreement or 100 percent of annual basic pay
for a 2-year service agreement. OPM has provided a fact sheet on
calculating maximum recruitment and relocation incentives for service
periods of various lengths.\3\
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\3\ Office of Personnel Management. ``Fact Sheet: Calculating
Maximum Recruitment and Relocation Incentives for Service Periods of
Various Lengths.'' https://www.opm.gov/policy-data-oversight/pay-leave/recruitment-relocation-retention-incentives/fact-sheets/calculating-maximum-recruitment-and-relocation-incentives-for-service-periods-of-various-lengths/.
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A waiver request must include a description of the critical agency
need the proposed recruitment or relocation incentive would address.
The authorized agency official must determine that the competencies
required for the position(s) are critical to the successful
accomplishment of an important agency mission, project, or initiative
(e.g., programs or projects related to a national emergency or
implementing a new law or critical management initiative). To assist
agencies in developing waiver requests, OPM has provided waiver request
templates for recruitment incentives \4\ and relocation incentives.\5\
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\4\ Office of Personnel Management. ``Recruitment Incentive
Waiver Template.'' https://www.opm.gov/policy-data-oversight/pay-leave/recruitment-relocation-retention-incentives/fact-sheets/recruitment-incentive-waiver-template.pdf.
\5\ Office of Personnel Management. ``Relocation Incentive
Waiver Template.'' https://www.opm.gov/policy-data-oversight/pay-leave/recruitment-relocation-retention-incentives/fact-sheets/relocation-incentive-waiver-template.pdf.
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The law, 5 U.S.C. 5754, does not permit the expansion of the waiver
authority for retention incentives found at 5 CFR part 575, subpart C.
Therefore, retention incentives are not included in this proposed rule.
Proposed Changes to Recruitment Incentive Rules
In 5 CFR part 575, subpart A, OPM is proposing to amend the current
regulations as follows:
Revise 5 CFR 575.106(a)(4) to provide an authorized agency
official with sole and exclusive discretion, subject only to OPM review
and oversight, to waive the limitation on the maximum amount of a
recruitment incentive under 5 CFR 575.109(c).
Require agencies at proposed 5 CFR 575.107(a) to designate
the officials with authority to waive the recruitment incentive payment
limitation in their recruitment incentive plans.
Amend the incentive approval level provisions in 5 CFR
575.107(b)(1) to state that if a determination to pay a recruitment
incentive includes a waiver of the payment limitation under 5 CFR
575.109(c), the official who is designated in the agency's plan under 5
CFR 575.107(a) must approve the determination.
Revise 5 CFR 575.107(b)(2) to state that when necessary to
make a timely offer of employment, an authorized agency official may
authorize an official who is not lower than a candidate's supervisor to
offer a recruitment incentive to a candidate without further review or
approval in any amount within a pre-established range up to the normal
payment limitation in 5 CFR 575.109(b) or a higher cap if the agency
has approved a waiver to the normal payment limitation under 5 CFR
575.109(c).
Amend 5 CFR 575.109(c)(1) to provide the conditions under
which an authorized agency official would be able to waive the payment
limitation in 5 CFR 575.109(b) for an employee or group of employees
based on a critical agency need.
Require in proposed 5 CFR 575.109(c)(2) that waiver
determinations be made in writing.
Delete 5 CFR 575.109(c)(2)(iii)-(v) to eliminate
redundancy because those requirements are covered by 5 CFR
575.109(c)(2)(ii).
Amend 5 CFR 575.110(a) to remove the minimum 6-month
required service period for recruitment incentives. Under the proposed
rule, a recruitment incentive service agreement could be any length up
to 4 years, consistent with the current allowable service agreement
lengths for relocation incentives. For example, this would allow an
agency to determine that a summer internship position is likely to be
difficult to fill and authorize a recruitment incentive for an intern
with a 3-month service agreement.
Proposed Changes to Relocation Incentive Rules
In 5 CFR part 575, subpart B, OPM is proposing to amend the current
regulations as follows:
Revise 5 CFR 575.206(a)(4) to provide an authorized agency
official with sole and exclusive discretion, subject only to OPM review
and oversight, to waive the limitation on the maximum amount of a
relocation incentive under 5 CFR 575.209(c).
Require agencies at proposed 5 CFR 575.207(a) to designate
the officials with authority to waive the relocation incentive payment
limitation in their relocation incentive plans.
Amend 5 CFR 575.207(b)(1) to state that if a determination
to pay a relocation incentive includes a waiver of the payment
limitation under 5 CFR 575.209(c), the official who is designated in
the agency's plan under 5 CFR 575.207(a) must approve the
determination.
Revise 5 CFR 575.209(c)(1) to provide the conditions under
which an authorized agency official may waive the payment limitation in
5 CFR 575.209(b) for an individual or group of employees based on a
critical agency need.
Require in proposed 5 CFR 575.209(c)(2) that waiver
determinations be made in writing.
Delete 5 CFR 575.209(c)(2)(iii)-(v) to eliminate
redundancy because those requirements are covered by 5 CFR
575.209(c)(2)(ii).
Other Changes
OPM is proposing to revise several sections to use gender neutral
language. These changes are contained at 5 CFR 575.102, 5 CFR
575.110(f), 5 CFR 575.111(e), 5 CFR 575.111(f), 5 CFR 575.210(f), 5 CFR
575.211(e), and 5 CFR 575.211(f).
Expected Impact of This Proposed Rule
A. Statement of Need
OPM serves as the chief human resources agency and personnel policy
manager for the Federal Government. OPM provides human resources
leadership and support to Federal agencies and helps the Federal
workforce achieve their goals as they serve the American people. OPM
oversees merit-based and inclusive hiring into the civil service,
directs human resources and employee management services, administers
retirement benefits, manages health insurance and insurance programs,
and manages personnel vetting policies and processes.
As noted in OPM's FY 2022-2026 Strategic Plan,\6\ ``We will promote
a diverse, equitable, inclusive, and accessible Federal workforce based
on merit; develop a strategic vision for the Federal Government to
prepare for the future of work; support Federal agencies to attract
early career talent; and equip current and future Federal workers with
the ability to build new skills over time to adapt to a rapidly
changing world.''
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\6\ Office of Personnel Management. ``Strategic Plan Fiscal
Years 2022-2026.'' https://www.opm.gov/about-us/strategic-plan/03454-fy2022-2026-strategicplan-lookbook-508pdf.pdf.
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In its March 2021 report,\7\ the National Academy of Public
Administration (NAPA) recommended that OPM adopt a more decentralized
and risk-based approach to executing its transactional approval and
oversight responsibilities. Specifically, NAPA recommended that OPM
delegate, to the maximum extent possible, decision-making authorities
to agencies, and conduct cyclical reviews to verify that appropriate
actions were taken. NAPA's Rec. 2.5 was incorporated into OPM's
Strategic Plan as Objective 4.2, which reads as follows: ``Increase
focus on Governmentwide policy work by
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shifting more low-risk delegations of authorities to agencies.''
Further, Objective 4.6 is to streamline Federal human capital
regulations and guidance to reduce administrative burden and promote
innovation while upholding merit system principles.
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\7\ National Academy of Public Administration. ``Elevating Human
Capital: Reframing the U.S. Office of Personnel Management's
Leadership Imperative'' https://www.volckeralliance.org/sites/default/files/attachments/OPM-Final-Report-National-Academy-of-Public-Administration.pdf.
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Permitting agencies to review and approve payment limit waivers at
the agency level will reduce administrative burden on agencies and
increase the efficiency of using recruitment and relocation incentives.
This will allow agencies to move more quickly in hiring new employees
and relocating those who are moving into positions that are likely to
be difficult to fill. Such efficiency could be especially helpful in
emergency or other critical situations in which recruiting new
employees or relocating current employees rapidly is necessary. Also,
with increases in the number of retirement-eligible employees,
recruiting early career and experienced talent to the Federal workforce
is a high priority. Using recruitment incentives can be a useful tool
in achieving this goal.
B. Impact
It is important to understand that waivers to the normal payment
limitations do not alter the maximum total amount of a recruitment or
relocation incentives that may be paid to an individual employee.
Agencies have the authority to approve a recruitment or relocation
incentive for payments of up to 25 percent of an employee's annual rate
of basic pay times the number of years in a service agreement, not to
exceed 4 years or 100 percent of annual basic pay. With a waiver,
agencies can approve a recruitment or relocation incentive of up to 50
percent of an employee's annual rate of basic pay times the number of
years in a service agreement, but still not to exceed 100 percent of
annual basic pay. Therefore, the total incentive paid under a waiver
continues to be limited to 100 percent of the employee's annual basic
pay, but the incentive may be paid over 2 years rather than 4 years.
Section 101(a) of the Federal Workforce Flexibility Act of 2004
(Pub. L. 108-411, October 30, 2004) established significantly enhanced
recruitment, relocation, and retention incentive authorities that
provided Federal agencies with the flexibility to use such incentives
in more strategic ways to help the Federal Government improve its
competitiveness in recruiting and maintaining a high quality workforce.
The enhancements provided by the Act included the authority to waive
the normal cap on recruitment and relocation incentives because of a
critical agency need and provided authority to pay higher amounts over
shorter periods of time (not to exceed a total of 100 percent of the
employee's starting salary). The implementing regulations \8\ required
OPM approval to waive the recruitment and relocation incentive limits.
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\8\ 70 FR 25732, May 13, 2005.
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Although this waiver authority was effective upon publication of
the implementing regulations on May 13, 2005, OPM did not receive any
agency requests for recruitment or relocation waivers until 2008. Since
that time, OPM has approved 15 recruitment incentive waivers for 6
agencies and 11 relocation incentive waivers for 4 agencies. OPM has
approved waivers for healthcare, cybersecurity, and other mission-
critical occupations. OPM-approved waivers provide agencies the
discretionary authority to use a higher recruitment or relocation
incentive payment limit for the covered position(s) and employee(s). An
agency with an OPM-approved incentive waiver is responsible for
documenting in writing the justification for paying each incentive
authorized for an employee under the waiver and obtaining approval from
the appropriate authorized agency official.
OPM does not know how agencies would use the additional flexibility
provided by this proposed change. It is possible that agencies would
approve more recruitment and relocation incentive waivers if they are
not required to go through the process of submitting a waiver request
to OPM. However, the criteria for approval will not be changing, so
agencies will still need to determine that the situation meets the
critical need and other requirements for approving a waiver. In other
words, approval of a waiver is not automatic and agencies will need to
use discretion in granting waiver requests. In addition, agencies will
need to make determinations about whether they have funds available in
their budgets to provide waivers. The use of discretionary pay
flexibilities such as recruitment and relocation incentives may be
limited by agency budgets.
As with the waiver authority, OPM does not know how agencies would
use the additional flexibility of utilizing recruitment incentive
service agreements of less than 6 months. Agencies do not report data
to OPM on the length of the service agreements they authorize. Since
the amount of the maximum recruitment incentive is based on the length
of the service period, an agency would be limited in how much of an
incentive they could authorize. For example, under the normal payment
limitations, the maximum recruitment incentive that could be paid for a
3-month service period is 6.25 percent (.25 (25 percent) x .25 (3
months or \1/4\ of 1 year) = 6.25 percent) of the employee's annual
rate of basic pay at the beginning of the service period. Under a
waiver, the maximum recruitment incentive that could be paid for a 3-
month service period is 12.5 percent (.50 (50 percent) x .25 (3 months
or \1/4\ of 1 year) = 12.5 percent) of the employee's annual rate of
basic pay at the beginning of the service period.
C. Regulatory Alternatives
An alternative to this proposed rule is to continue to require
agencies to request approval from OPM when they seek waiver of the
normal recruitment and relocation payment limitations. OPM would
continue to review agency requests and grant waivers if the regulatory
criteria are met. However, this slows down the approval process for
agencies that have a critical need to recruit or relocate employees and
need to act quickly.
Another alternative would be to expand the authority to waive the
normal recruitment and relocation payment limitations, but require
higher approval levels within the agency. OPM believes agencies are in
the best position to decide at what level to delegate this authority
within their agency.
Also, OPM could expand the agency waiver authority, but require
additional approval criteria. Agencies may include additional approval
criteria in their agency plan. OPM doesn't believe it is necessary to
require agencies to use additional approval criteria.
Finally, OPM could expand the agency waiver authority, but
institute special reporting requirements for the use of the new waiver
authority. Agencies are required to report to OPM's central data system
when they authorize a waiver of the normal recruitment or relocation
incentive payment limitations using legal authority code VPO. OPM
doesn't believe additional reporting requirements are necessary.
Regarding the amendment of the service agreement requirement for
recruitment incentives, possible alternatives include maintaining the
current 6-month minimum service agreement or reducing it to a lesser
amount (e.g., 3 months). OPM believes agencies are in the best position
to decide the appropriate length for a recruitment incentive service
agreement.
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D. Costs
This proposed rule would affect the operations of more than 80
Federal agencies--ranging from cabinet-level departments to small
independent agencies--that have employees covered by the recruitment
and relocation incentive regulations. OPM estimates that this rule
would require individuals employed by these agencies to spend time
updating agency policies and procedures as a result of the proposed
regulations. For this cost analysis, the assumed average salary rate of
Federal employees performing this work will be the rate in 2023 for GS-
14, step 5, from the Washington, DC, locality pay table ($150,016
annual locality rate and $71.88 hourly locality rate). OPM assumes the
total dollar value of labor, which includes wages, benefits, and
overhead, is equal to 200 percent of the wage rate, resulting in an
assumed labor cost of $143.76 per hour.
To comply with the regulatory changes in the proposed rule,
affected agencies would need to review the rule and update their
policies and procedures. OPM estimates that, in the first year
following publication of a final rule, this would require an average of
160 hours of work by employees with an average hourly cost of $143.76
per hour. This would result in estimated costs in that first year of
implementation of about $23,000 per agency, and about $2.7 million
Governmentwide. There are costs associated with administering
recruitment and relocation incentives, but not necessarily an increase
in administrative costs for agencies that are already using these pay
flexibilities.
E. Benefits
Permitting agencies to review and approve waivers at the agency
level will reduce administrative burden on agencies and increase the
efficiency of using recruitment and relocation incentives. This will
allow agencies to move more quickly in approving incentives when hiring
new employees and relocating those who are moving into positions that
are likely to be difficult to fill. Such efficiency could be especially
helpful in emergency or other urgent situations in which recruiting new
employees or relocating current employees rapidly is necessary. Also,
with increases in the number of retirement-eligible employees,
recruiting early career and experienced talent to the Federal workforce
is a high priority. Providing agencies with more flexibility in
implementing recruitment incentives by permitting greater latitude in
determining service agreement lengths and payment limits can be a
useful tool in achieving this goal.
F. Request for Comments
OPM requests comments on the implementation and impacts of this
proposed rule. Such information will be useful for better understanding
the effect of these regulations on recruitment and relocation
incentives. The type of information in which OPM is interested
includes, but is not limited to, the following:
Are there additional ways that the Federal Government can
be a model employer with respect to recruitment and relocation
incentives?
How can the Federal Government use recruitment and
relocation incentives more effectively and efficiently?
OPM has provided a fact sheet addressing oversight and
accountability for these incentives.\9\ Are there any additional ways
in which the Federal Government can provide better oversight and
accountability of recruitment and relocation incentives?
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\9\ Office of Personnel Management. ``Fact Sheet: Oversight and
Accountability.'' https://www.opm.gov/policy-data-oversight/pay-leave/recruitment-relocation-retention-incentives/fact-sheets/oversight-and-accountability/.
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E.O. 12866, 13563, 14094, Regulatory Review
OPM has examined the impact of this rule as required by Executive
Order 12866 and Executive Order 13563, and Executive Order 14094, which
direct agencies to assess all costs and benefits of available
regulatory alternatives and, if regulation is necessary, to select
regulatory approaches that maximize net benefits (including potential
economic, environmental, public, health, and safety effects,
distributive impacts, and equity). A regulatory impact analysis must be
prepared for major rules with economically significant effects of $200
million or more in any one year. While this proposed rule does not
reach the economic effect of $200 million or more, OMB has designated
this rule as a ``significant regulatory action'' under Executive Order
14094.
Regulatory Flexibility Act
The Director of OPM certifies that this proposed rule will not have
a significant economic impact on a substantial number of small entities
because they will apply only to Federal agencies and employees.
E.O. 13132, Federalism
This proposed rule will not have substantial direct effects on the
States, on the relationship between the National Government and the
States, or on distribution of power and responsibilities among the
various levels of government. Therefore, in accordance with Executive
Order 13132, it is determined that this proposed rule does not have
sufficient federalism implications to warrant preparation of a
Federalism Assessment.
E.O. 12988, Civil Justice Reform
This proposed rule meets the applicable standards set forth in
section 3(a) and (b)(2) of Executive Order 12988.
Unfunded Mandates Reform Act of 1995
This proposed rule will not result in the expenditure by State,
local or tribal governments, in the aggregate, or by the private
sector, of more than $100 million annually. Thus, no written assessment
of unfunded mandates is required.
Paperwork Reduction Act of 1995 (44 U.S.C. Chapter 35)
This regulatory action will not impose any reporting or
recordkeeping requirements under the Paperwork Reduction Act.
List of Subjects in Title 5 CFR Part 575
Government employees, Wages.
Office of Personnel Management.
Kayyonne Marston,
Federal Register Liaison.
Accordingly, OPM is proposing to amend 5 CFR part 575 as follows:
PART 575--RECRUITMENT, RELOCATION, AND RETENTION INCENTIVES;
SUPERVISORY DIFFERENTIALS; AND EXTENDED ASSIGNMENT INCENTIVES
0
1. The authority citation for part 575 continues to read as follows:
Authority: 5 U.S.C. 1104(a)(2) and 5307; subparts A and B also
issued under 5 U.S.C. 5753; subpart C also issued under 5 U.S.C.
5754; subpart D also issued under 5 U.S.C. 5755; subpart E also
issued under 5 U.S.C. 5757 and sec. 207 of Public Law 107-273, 116
Stat. 1780.
Subpart A--Recruitment Incentives
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2. In Sec. 575.102, revise paragraph (3) of the definition ``Newly
appointed'' to read as follows:
Sec. 575.102 Definitions.
* * * * *
Newly appointed * * *
(3) An appointment of an individual in the Federal Government when
the individual's service in the Federal Government during the 90-day
period
[[Page 78248]]
immediately preceding the appointment was not in a position excluded by
Sec. 575.104 and was limited to one or more of the following:
* * * * *
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3. In Sec. 575.106, revise paragraph (a)(4) to read as follows:
Sec. 575.106 Authorizing a recruitment incentive.
(a) * * *
(4) Waive the limitation on the maximum amount of a recruitment
incentive under Sec. 575.109(c); and
* * * * *
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4. In Sec. 575.107, revise paragraphs (a)(1) and (b) to read as
follows:
Sec. 575.107 Agency recruitment incentive plan and approval levels.
(a) * * *
(1) The designation of officials with authority to--
(i) Review and approve payment of recruitment incentives (subject
to paragraph (b) of this section), including the circumstances under
which an official has the authority to approve payment without higher-
level approval under paragraph (b)(2) of this section;
(ii) Waive the recruitment incentive payment limitation under Sec.
575.109(c) (subject to the approval requirements in paragraph (b) of
this section); and
(iii) Waive the repayment of a recruitment incentive under Sec.
575.111(h);
* * * * *
(b) (1) Except as provided in paragraph (b)(2) of this section, an
authorized agency official who is at least one level higher than the
employee's supervisor must review and approve each determination to pay
a recruitment incentive to a newly appointed employee, unless there is
no official at a higher level in the agency. If a determination
includes a waiver of the payment limitation in Sec. 575.109(c), the
official who is designated in the agency's plan under Sec. 575.107(a)
to approve waivers must approve the determination. The authorized
agency official must review and approve the recruitment incentive
determination before the agency may pay the incentive to the employee.
(2) When necessary to make a timely offer of employment, an
authorized agency official may establish criteria in advance for
offering recruitment incentives to newly-appointed employees and may
authorize an official who is not lower than a candidate's supervisor to
use these criteria to offer a recruitment incentive to a candidate
without further review or approval in any amount within a pre-
established range up to--
(i) The normal payment limitation in Sec. 575.109(b); or
(ii) A higher cap if the agency has approved a waiver to the normal
payment limitation under Sec. 575.109(c).
* * * * *
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5. In Sec. 575.109, revise paragraph (c) to read as follows:
Sec. 575.109 Payment of recruitment incentives.
* * * * *
(c) (1) An authorized agency official may waive the limitation in
paragraph (b)(1) of this section for an employee or group of employees
based on a critical agency need. The authorized agency official must
determine that the competencies required for the position(s) are
critical to the successful accomplishment of an important agency
mission, project, or initiative (e.g., programs or projects related to
a national emergency or implementing a new law or critical management
initiative). Under such a waiver, the total amount of recruitment
incentive payments paid to an employee in a service period may not
exceed 50 percent of the employee's annual rate of basic pay at the
beginning of the service period multiplied by the number of years
(including fractions of a year) in the service period. However, in no
event may a waiver provide total recruitment incentive payments
exceeding 100 percent of the employee's annual rate of basic pay at the
beginning of the service period.
(2) Waiver determinations must be made in writing and include--
(i) A description of the critical agency need the recruitment
incentive would address;
(ii) The documentation required by Sec. 575.108; and
(iii) Any other information pertinent to the case at hand.
* * * * *
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6. In Sec. 575.110, revise paragraphs (a) and (f) to read as follows:
Sec. 575.110 Service agreement requirements.
(a) Before paying a recruitment incentive, an agency must require
the employee to sign a written service agreement to complete a
specified period of employment with the agency (or successor agency in
the event of a transfer of function). An authorized agency official
must establish the criteria for determining the length of a service
period. The service period may not exceed 4 years.
* * * * *
(f) The service agreement may include any other terms or conditions
that, if violated, will result in termination of the service agreement
under Sec. 575.111(b). For example, the service agreement may specify
the employee's work schedule, type of position, and the duties the
employee is expected to perform. In addition, the service agreement may
address the extent to which periods of time on detail, in a nonpay
status, or in a paid leave status are creditable towards the completion
of the service period.
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7. In Sec. 575.111, revise paragraphs (e) and (f) to read as follows:
Sec. 575.111 Termination of a service agreement.
* * * * *
(e) If an authorized agency official terminates a service agreement
under paragraph (a) of this section, the employee is entitled to all
recruitment incentive payments that are attributable to completed
service and to retain any portion of a recruitment incentive payment
the employee received that is attributable to uncompleted service.
(f) Except as provided in paragraph (j) of this section, if an
authorized agency official terminates a service agreement under
paragraph (b) of this section, the employee is entitled to retain
recruitment incentive payments previously paid by the agency that are
attributable to the completed portion of the service period. If the
employee received recruitment incentive payments that are less than the
amount that would be attributable to the completed portion of the
service period, the agency is not obligated to pay the employee the
amount attributable to completed service, unless the agency agreed to
such payment under the terms of the recruitment incentive service
agreement. If the employee received recruitment incentive payments in
excess of the amount that would be attributable to the completed
portion of the service period, the employee must repay the excess
amount, except when an authorized agency official waives the
requirement to repay the excess amount under paragraph (h) of this
section.
* * * * *
Subpart B--Relocation Incentives
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8. In Sec. 575.206, revise paragraph (a)(4) to read as follows:
Sec. 575.206 Authorizing a relocation incentive.
(a) * * *
(4) Waive the limitation on the maximum amount of a relocation
incentive under Sec. 575.209(c); and
* * * * *
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9. In Sec. 575.207, revise paragraphs (a)(1) and (b)(1) to read as
follows:
[[Page 78249]]
Sec. 575.207 Agency relocation incentive plan and approval levels.
(a) * * *
(1) The designation of officials with authority to--
(i) Review and approve payment of relocation incentives (subject to
paragraph (b) of this section);
(ii) Waive the relocation incentive payment limitation under Sec.
575.209(c) (subject to the approval requirements in paragraph (b) of
this section); and
(iii) Waive the repayment of a relocation incentive under Sec.
575.211(h);
* * * * *
(b) (1) Except as provided in paragraph (b)(2) of this section, an
authorized agency official who is at least one level higher than the
employee's supervisor must review and approve each determination to pay
a relocation incentive, unless there is no official at a higher level
in the agency. If a determination includes a waiver of the payment
limitation in Sec. 575.209(c), the official who is designated in the
agency's plan under Sec. 575.207(a) to approve waivers must approve
the determination. The authorized agency official must review and
approve the relocation incentive determination before the agency pays
the incentive to the employee.
* * * * *
0
10. In Sec. 575.209, revise paragraph (c) to read as follows:
Sec. 575.209 Payment of relocation incentives.
* * * * *
(c) (1) An authorized agency official may waive the limitation in
paragraph (b)(1) of this section for an employee (or group of
employees, if the case-by-case determination is waived under the
conditions in Sec. 575.208(b)) based on a critical agency need. The
authorized agency official must determine that the competencies
required for the position are critical to the successful accomplishment
of an important agency mission, project, or initiative (e.g., programs
or projects related to a national emergency or implementing a new law
or critical management initiative). Under such a waiver, the total
amount of relocation incentive payments paid to an employee in a
service period may not exceed 50 percent of the annual rate of basic
pay of the employee at the beginning of the service period multiplied
by the number of years (including fractions of a year) in the service
period. However, in no event may a waiver provide total relocation
incentive payments exceeding 100 percent of the employee's annual rate
of basic pay at the beginning of the service period.
(2) Waiver determinations must be in writing and include--
(i) A description of the critical agency need the relocation
incentive would address;
(ii) The documentation required by Sec. 575.208;
and
(iii) Any other information pertinent to the case at hand.
* * * * *
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11. In Sec. 575.210, revise paragraph (f) to read as follows:
Sec. 575.210 Service agreement requirements.
* * * * *
(f) The service agreement may include any other terms or conditions
that, if violated, will result in termination of the service agreement.
For example, the service agreement may specify the employee's work
schedule, type of position, and the duties the employee is expected to
perform. In addition, the service agreement may address the extent to
which periods of time on detail, in a nonpay status, or in a paid leave
status are creditable towards the completion of the service period.
0
12. In Sec. 575.211, revise paragraphs (e) and (f) to read as follows:
Sec. 575.211 Termination of a service agreement.
* * * * *
(e) If an authorized agency official terminates a service agreement
under paragraph (a) of this section, the employee is entitled to all
relocation incentive payments attributable to completed service and to
retain any portion of a relocation incentive payment the employee
received that is attributable to uncompleted service.
(f) If an authorized agency official terminates a service agreement
under paragraph (b) of this section, the employee is entitled to retain
relocation incentive payments previously paid by the agency that are
attributable to the completed portion of the service period. If the
employee received relocation incentive payments that are less than the
amount that would be attributable to the completed portion of the
service period, the agency is not obligated to pay the employee the
amount attributable to completed service, unless the agency agreed to
such payment under the terms of the relocation incentive service
agreement. If the employee received relocation incentive payments in
excess of the amount that would be attributable to the completed
portion of the service period, the employee must repay the excess
amount, except when an authorized agency official waives the
requirement to repay the excess amount under paragraph (h) of this
section.
* * * * *
[FR Doc. 2023-25199 Filed 11-14-23; 8:45 am]
BILLING CODE 6325-39-P