The Office of Personnel Management (OPM) is issuing interim regulations to significantly enhance the recruitment, relocation, and retention payment authorities. (See Attachment 1.) These regulations implement section 101(a) of the Federal Workforce Flexibility Act of 2004 (Public Law 108-411, October 30, 2004), which provides agencies with the flexibility to use these authorities strategically to improve the Federal Government's ability to recruit and retain a high quality workforce. (See CPM 2004-22, November 1, 2004.) The new recruitment, relocation, and retention payment authorities under 5 U.S.C. 5753 and 5754 replace the former recruitment and relocation bonus and retention allowance authorities.
Recruitment, relocation, and retention payments are designed to provide a monetary incentive for an individual or group to accept employment or remain employed in the Federal service in a current position(s). The interim regulations use the term "incentive" in place of "bonus" in order to distinguish these payments from those given to an individual or group to recognize and reward performance.
The interim regulations implementing the new recruitment, relocation and retention payment authorities are effective immediately upon publication in the Federal Register. Agencies must apply these interim regulations for new recruitment, relocation, or retention incentives authorized on or after that date. However, if an individual received a formal offer of a new recruitment, relocation, or retention payment before May 1, 2005, the agency may make the payment as long as the terms associated with the offer were consistent with the regulations governing recruitment and relocation bonuses and retention allowances in effect when the offer was made.
Payments Authorized Before May 1, 2005
The law and interim regulations continue provisions for recruitment and relocation bonus service agreements and retention allowances authorized before May 1, 2005. Recruitment and relocation bonus service agreements authorized under 5 U.S.C. 5753 and 5 CFR part 575, subparts A and B, before May 1, 2005, must continue until their expiration, subject to the law and regulations applicable to recruitment and relocation bonuses before May 1, 2005. Also, agencies must continue to pay retention allowances authorized under 5 U.S.C. 5754 and 5 CFR part 575, subpart C, before May 1, 2005, until the retention allowance is reauthorized or terminated, but not later than April 30, 2006, subject to the law and regulations applicable to retention allowances before May 1, 2005.
Under the law and interim regulations, agencies must establish a plan for each of the new recruitment, relocation and retention incentive authorities before authorizing any new payments. However, an agency may establish an overall policy for using recruitment, relocation, and retention incentives that addresses the criteria, options, and requirements that apply to all three incentives, but also includes separate plans that provide detailed information on the unique features of each of the recruitment, relocation, and retention incentive authorities. The agency's plans must apply uniformly across the agency, unless the agency head determines otherwise.
Under the law and interim regulations, agencies generally may apply the new recruitment, relocation and retention incentive authorities to the same categories of employees covered by the former recruitment and relocation bonus and retention allowance authorities. These categories include employees in General Schedule (GS), senior-level (SL) and scientific or professional (ST), Senior Executive Service (SES), Federal Bureau of Investigation and Drug Enforcement Administration (FBI/DEA) SES, Executive Schedule (EX), law enforcement officer, and prevailing rate positions. Agencies may not pay a recruitment, relocation, or retention incentive under the new authorities to an employee in a position (1) to which an individual is appointed by the President, by and with the advice and consent of the Senate; (2) in the Senior Executive Service as a noncareer appointee (as defined in 5 U.S.C. 3132(a)); (3) excepted from the competitive service by reason of its confidential, policy-determining, policy-making, or policy-advocating nature; (4) to which an individual is appointed by the President without the advice and consent of the Senate; (5) designated as the head of an agency; or (4) in the expectation of receiving an appointment as the head of an agency.
Under 5 U.S.C. 5753(a)(1)(B) and 5754(a)(1)(B), OPM has decided to approve those single-agency categories of employees that were previously approved for coverage under the former recruitment and relocation bonus and retention allowance authorities for coverage under the new incentive authorities, except when otherwise requested by the head of an Executive agency or when such categories are excluded by the new law or interim regulations. The approved employee categories are listed in Attachment 2.
Please notify your OPM Human Capital Officer by May 30, 2005, if you do not want a previously approved employee category in your agency to be covered by the new recruitment, relocation, and retention incentive authorities or if a previously approved employee category in your agency is excluded from coverage by the new law or regulations. The employee categories listed in Attachment 2 are covered by the new recruitment, relocation, and retention incentive authorities unless you notify OPM otherwise or unless the category is excluded by the law or interim regulations. Please contact your OPM Human Capital Officer if you want to request OPM approval of coverage under the new recruitment, relocation, and retention incentive authorities for additional categories of employees within your agency.
Section 101 of the Act amended 5 U.S.C. 5753(b) to allow OPM to authorize the head of an agency to pay a recruitment incentive to a current employee who accepts a position (in the same or a different agency) in the same geographic area, when the position is likely to be difficult to fill in the absence of an incentive under circumstances described in OPM's regulations. Similarly, 5 U.S.C. 5754 was amended to allow OPM to authorize the head of an agency to pay a retention incentive to a current employee who would be likely to leave his or her position for a different position in the Federal service in the absence of a retention incentive under conditions described in OPM's regulations. Congress asked OPM to monitor the use of recruitment and retention incentives under these circumstances to ensure that they are an effective use of the Federal Government's funds and do not adversely affect the mission of those Government agencies that lose employees to other agencies.
OPM recognizes the potential for costly and counterproductive interagency competition if agencies are permitted to authorize recruitment and retention incentives to recruit employees to move from other agencies or to retain employees offered positions in other agencies. We have discussed this issue with the Chief Human Capital Officers Council (CHCO) and have agreed that, before we issue regulations providing agencies with such authority, we are inviting comments from interested parties on (1) whether agencies should be permitted to make these payments, and (2) if so, the specific circumstances in which such incentives should be authorized. Therefore, the interim regulations do not provide agencies with the authority to pay interagency recruitment or retention incentives to current employees. We invite interested parties to provide comments on these issues.
To assist agencies in administering the new recruitment, relocation, and retention incentive authorities, we are issuing revised fact sheets and examples of calculating recruitment, relocation, and retention incentive payments. The fact sheets and pay examples are available at http://www.opm.gov/oca/pay/HTML/factindx.asp. OPM will issue additional guidance as necessary. Instructions for processing recruitment, relocation, and retention incentives will be issued separately. We will also invite agencies to an OPM forum, where we will provide detailed information and practical examples on the application of the new recruitment, relocation, and retention incentive authorities.
For additional information, agency Chief Human Capital Officers and/or Human Resources Directors should contact their assigned OPM Human Capital Officer. Employees should contact their agency human resources office for assistance.
cc: Chief Human Capital Officers
Human Resources Directors
Attachment 1 - Interim Regulations on Recruitment, Relocation, and Retention
Attachment 2 Recruitment, Relocation, and Retention Incentives: Coverage of Non-General Schedule Employees Under Single-Agency Pay Systems