Laboratory Personnel Management Demonstration Project; Department of the Army, U.S. Army Medical Research and Materiel Command, Fort Detrick, Frederick, Maryland

SUMMARY: The National Defense Authorization Act for Fiscal Year 1995

authorizes the Secretary of Defense, with Office of Personnel

Management (OPM) approval, to conduct personnel demonstration projects

at Department of Defense (DoD) laboratories designated as Science and

Technology Reinvention Laboratories. 5 U.S.C. 4703 authorizes OPM 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 Federal

personnel management.

DATES: This demonstration project may be implemented at the U.S. Army

Medical Research and Materiel Command (MRMC) beginning June 3, 1998.

FOR FURTHER INFORMATION CONTACT: MRMC: Carol Dick, US Army Medical

Research and Materiel Command, ATTN: MCHD-CP, 810 Schreider Street,

Suite 120, Fort Detrick, Maryland 21702-5000, phone 301-619-2247. OPM:

Fidelma A. Donahue, U.S. Office of Personnel Management, 1900 E Street,

NW, Room 7460, Washington, DC 20415, phone 202-606-1138.

SUPPLEMENTARY INFORMATION:

1. Overview

On March 12, 1997, [62 FR 11676] OPM published this proposed

demonstration plan and received 125 comments (one letter had 62

signatures and another had 35 signatures). Seven individuals commented

on the Federal Register notice at the Public Hearings. These comments

brought new and different perspectives to the attention of those

responsible for implementing, overseeing, and evaluating the project.

The comments highlighted instances of either miscommunication and/or

misunderstanding of the present system as well as the project

interventions. Further, the comments underscored the importance of

providing training to employees and supervisors on the demonstration

project. In consideration of the comments received, the demonstration

project has been modified to remove the annual general increase from

the performance pay pool. This change required modification,

clarification, and/or expanded text in the plan to address technical

provisions. A summary of comments received, along with accompanied

responses, is provided below:

A. Pay-for-Performance

1. Comment: There were 120 comments (one letter had 62 signatures

and another had 35 signatures) that expressed concern over the

inclusion of the annual general increase (often referred to as ``cost-

of-living allowance'' (COLA) by many commentors) in the performance pay

pool. Several indicated they believed it was inappropriate and may be

illegal to deny their annual general increase, which they believed was

provided to them by Congress to off-set inflation. Several stated that

the annual general increase is not tied to performance, therefore, it

should not be included in a pay-for-performance experimental program.

One commentor stated this will be the first time a demonstration

project will include the annual general increase in its ``merit pay

pool,'' and another stated neither China Lake nor the National

Institute of Standards and Technology included the annual general

increase in their demonstrations, and that the China Lake demonstration

had ended because of problems with the experimental personnel system.

Several commentors stated they were never informed prior to the

proposed plan that the annual general increase/COLA would be part of

the performance pay pool, while others claimed they had raised

objections to the annual general increase/COLA being part of the

performance pay pool prior to the publication of the Federal Register,

yet their objections were ignored. Many expressed concern that without

sufficient safeguards to prevent favoritism and abuse of power,

inclusion of the annual general increase in the performance pay pool

will result in supervisors denying increases to employees' base pay

and/or bonuses and will reduce teamwork, i.e., pit employee against

employee, and destroy morale. One employee suggested that because

employees have no control over inflation, but do control their

performance, that the awards budget should be increased to reward

performance. Some commentors, however, did agree with the pay-for-

performance concept.

Response: The comments on the annual general increase demonstrated

both miscommunication and misunderstanding of both the present and

proposed personnel systems. Briefings were provided to all employees at

each subordinate activity which included the fact that the ``annual

general increase'' would be included in the performance pay pool.

During the 2\1/2\ years of project development and design, many changes

occurred. Periodic updates were provided to the activity Commanders and

Directors for dissemination to the workforce. Commentors believed the

term ``annual general increase'' was a cost of living allowance. For

clarification purposes, the General Schedule (GS) pay adjustments

authorized under 5 U.S.C. 5303 are based on the cost of labor, not the

cost of living. Pay adjustments are linked to changes in the Employment

Cost Index (ECI). The ECI measures the overall rate of change in

employer's compensation costs in the private and public sectors,

excluding the Federal Government. The ECI does not measure the cost of

consumer goods and services. Additionally, the Department of Navy's

``China Lake'' demonstration project did include the annual general

increase in its incentive pay pool for the purposes of rewarding

employees based on performance. This compensation mechanism was

designed to send a clear message that top performers are valued in the

organization. The evaluations showed that a higher retention rate among

top performers resulted under the China Lake demonstration project.

Based on its success, Congress made permanent the China Lake

demonstration project under the same authority that granted

authorization of the DoD laboratory demonstration projects. We

acknowledge concerns expressed by employees and have attempted to build

a number of checks and balances in the new personnel system to ensure

an equitably administered program. The awards program is separate from

pay for performance and does not impact the performance pay pool. In

light of the comments received, the annual general increase was removed

from the performance pay pool. This change necessitated modification/

revision in various parts of the plan. These changes are in Section

III. C (Pay for Performance Management System), (Pay for Performance),

and (Performance Pay Increases and/or Performance Bonus).

2. Comment: Two commentors were concerned that any type of

performance bonus, rather than an increase in base pay, will have a

negative effect on their retirement (e.g., determination of high-three

salaries/matching funds for Thrift Savings Plan).

Response: Employees will have the potential for higher salaries

(base pay

[[Page 10441]]

and performance bonus) than currently afforded in the GS system, based

on their performance. The demonstration proposal clearly changes the

methods of providing incentives to employees, including the provision

of individual incentive bonuses or pay. Changing the method of

determining base pay increases does not change any provision of the

retirement system or any other benefit program. Under demonstration

authority, retirement provisions cannot be changed.

B. Performance Pay Pool

1. Comment: Two comments received asked why employees rated at the

``C'' level in the lower half of the pay band receive an increase to

their basic rate of pay while employees whose salary is beyond the mid-

point with the same rating, will receive no increase to their basic

rate of pay. They concluded that an employee who continues to perform

at the ``C'' level could also end up in a lower pay band. Further, they

felt that those employees who perform at the ``A'' or ``B'' level and

have reached the top of their pay band may not move into the next pay

band, and that the most these employees may receive is a performance

bonus, which defeats the whole concept of rewarding outstanding

performance.

Response: References to the mid-point of the pay bands (lower and

upper half) no longer apply throughout the text of the proposed plan

because of the change to remove the annual general increase from the

performance pay pool (reference A1). Employees who are rated ``C'' will

receive the annual general increase and locality adjustment, but will

not be eligible for a performance based increase to their basic rate of

pay or a performance bonus. Employees who perform at the ``A'' or ``B''

level will receive an adjustment in their basic rate of pay, a

performance bonus, or a combination of both to reward them for

performance, in addition to the annual general increase and locality

adjustment. These changes are in Section III. C (Pay for Performance).

Employees who have reached the top of their pay band may not move into

the next pay band without a promotion. Movement into the next higher

pay band constitutes a ``promotion'' which requires the employee to

perform ``higher level duties,'' not just continue to perform their

current duties at the ``A'' or ``B'' level in their current pay band.

2. Comment: Two comments received requested clarification on the

upper versus lower half of the pay bands and questioned why employees

were compensated differently depending on their performance and

location within the pay band. A single comment was received on the size

of the Engineers and Scientists (E&S) Pay Band II, specifically why it

contains 8 pay bands when the proposed plan stated: ``Each occupational

family will be divided into three to five pay bands * * *''

Response: The decision to withdraw the annual general increase from

the performance pay pool and continue granting the annual general

increase to employees rated ``A,'' ``B,'' or ``C'' eliminates the need

to determine upper and lower half of each pay band. The size of Pay

Band II of the E&S Occupational Family encompasses 8 grades (not pay

bands) under the current General Schedule (GS) system and was designed

to allow progression from entry level to full-performance level of

those positions. As illustrated in the proposed plan, the E&S

Occupational Family is divided into 5 pay bands. The elimination of the

distinctions between the upper and lower halves of the pay band and the

mid-point principle have been removed in Section III. C (Performance

Pay Pool).

C. Supervisory Bonus

Comment: Three commentors were concerned that no guidelines were

established to avoid supervisory/managerial misuse of power, and one

expressed concern that supervisors would be rewarded via supervisory

bonuses, prior to demonstration of performance and that payment of the

supervisory bonus from the performance pay pool was inappropriate.

Response: The supervisory bonus may be granted to recognize

supervisory responsibilities required most often of those in the same

pay band as non-supervisory subordinates. The Personnel Demonstration

Project Standard Operating Procedures will delineate the criteria

Commanders/Directors are to use when making a decision to grant these

bonuses, which must be negotiated annually, and will not be treated as

basic pay. The funds to pay supervisory bonuses are not a part of the

pay-for-performance pool. It is anticipated that situations warranting

supervisory bonuses will be minimal. Clarification has been added to

Section III. C (Supervisory Bonus).

D. Revised Reduction-in-Force (RIF) Procedures

Comment: Five commentors expressed concerns about the proposed RIF

procedures. Two were concerned that their rights during a RIF have been

withdrawn or limited. One expressed concern that length of service was

the last retention factor considered. Another individual requested an

explanation of the order of the retention factors and the definition of

tenure. One individual requested a comparison of current versus

proposed RIF procedures.

Response: The RIF rights and protections afforded to employees have

not been removed. Current RIF procedures are covered under 5 CFR 351

and are complicated, costly, and relatively unresponsive to the needs

of the organization. MRMC believes that flexible and responsive

alternatives are needed that will place greater emphasis on performance

rather than length of service. Only four elements in the RIF procedures

have been modified: competitive areas, assignment rights, credit for

performance ratings, and service computation date, as outlined below:

(1) Competitive areas have been modified to make each of the four

occupational families a separate competitive area within each activity.

(2) Assignment rights have been modified to restrict bumping and

retreating to positions within the employee's current occupational

family, one pay band below the employee's current pay band. A

preference eligible veteran with a compensable service-connected

disability of 30% or more may retreat to positions, within the

employee's current occupational family, two bands (or the equivalent of

five (5) grades) below his/her current band.

(3) Credit for performance has been modified to be cumulative

rather than averaged, and the number of years applied to specific

ratings have been changed to A-10, B-7, C-3, and F-0. Cumulative

performance ratings will serve as a stand alone retention determination

in the RIF process after consideration of tenure and veterans

preference.

(4) The service computation date (as determined by length of

service) includes all creditable service (civilian and military) and

will be used in situations where credit for performance results in

equal standing of two or more individuals in a RIF situation. Tenure is

the employee's type of appointment, i.e., career, career-conditional,

temporary, term, excepted service, etc. Clarification has been provided

in Section III. F (Revised Reduction-in-Force (RIF) Procedures) to

explain when service computation date (length of service) will be

applied.

E. Conversion

1. Comment: One comment concerned employees being adversely

affected by receiving a lump sum bonus instead of an increase in their

basic rate of pay if

[[Page 10442]]

the demonstration project ends or if employees transfer out of the

project.

Response: The lump-sum bonus referred to by the commentor is the

prorated within-grade increase (WGI) buyout as described in the

conversion procedures in the project plan. However, the inclusion of

pay banding, as outlined in the demonstration project, provides the

potential for higher pay (base pay and performance bonus) than

currently afforded in the GS system. Basic rates of pay attained during

participation in the demonstration project will continue upon lateral

conversion from the demonstration project to a GS position or if the

demonstration project ends. (Except for Pay Band V positions in certain

circumstances).

2. Comment: Two commentors asked exactly when the WGI buyout would

be paid (either at the beginning of the demonstration project or on the

one year anniversary date). Another commentor expressed concern over

the fiscal burden of the lump-sum payment of the prorated WGIs.

Response: Clarification is provided under Part V of this plan. The

funding required to pay employees for time served towards their WGI

will be calculated/documented prior to implementation of the project

and those funds will be set aside to be paid in a lump-sum at the one

year anniversary of the demonstration project. These funds will be

separate and apart from the performance pay pool for this one time

payment.

F. Evaluation Plan

Comment: One commentor stated he did not see anything which listed

an employee's increased satisfaction with pay, pay equity or

performance awards or with the agency's understanding of personal or

family issues as an expected or desired benefit.

Response: Part VII of the proposed plan provided information on the

Evaluation Plan. Employee attitudes and feedback using surveys,

structured interviews and focus groups, will be included in the

evaluation methods used to assess the impact of the project and will be

ongoing for the duration of the project. The personnel demonstration

project will not be evaluating personal or family issues. Because these

current policies and practices are not changed, these issues will not

be evaluated by the proposal.

G. Personnel Management Board

Comment: Four comments expressed concerns regarding the Personnel

Management Board (Board). Specifically, will the selection procedures

provide for a true representation of the civilian workforce, what are

the qualifications to be on the board, and will there be checks and

balances to ensure equitable treatment?

Response: The composition of the Personnel Management Board will be

determined by the Commander, MRMC. We are sensitive to the concerns

raised as to the composition of the Personnel Management Board. These

concerns will be considered as the Commander, MRMC appoints members to

the Personnel Management Board. The Personnel Management Board will be

particularly sensitive to issues of fairness and equity, and is charged

with the responsibility of providing oversight, policy, guidelines, and

corrective action. Section II. H (Personnel Management Board) of the

proposed plan spelled out the Board responsibilities which are

delegated to the subordinate activity Commanders/Directors.

H. Miscellaneous Comments

1. Comment: A single comment stated that the proposed system

violated the first principle of personnel management in that the people

(i.e., military supervisors) administering the demonstration plan will

not be subject to its provisions.

Response: It is true that military supervisors will not be covered

by the demonstration project. However, it is also true that all

supervisors (military and civilian) must comply with the rules and

regulations set forth by the project. Project oversight will be

provided by the Personnel Management Board and an executive steering

committee made up of top level executives within the Department of

Army.

2. Comment: A single commentor wanted to know why employees in the

Senior Executive Service (SES), the Civilian Intelligence Personnel

Management System (CIPMS), and the Federal Wage System (FWS) were not

covered by the MRMC demonstration project.

Response: The SES, CIPMS, and FWS employees are all covered by

personnel regulations, separate and apart from those governing General

Schedule employees. The number of employees covered by these personnel

systems were too small to attempt proposing changes and to realize any

meaningful results at this time.

3. Comment: One commentor requested the demonstration project plan

be written in terms that everyone understands.

Response: The comment is a good suggestion; however, the project

plan replaces many of the existing title 5 provisions, thus it must

contain technical language. Wherever possible, we have tried to use

language as simple as possible throughout the project plan.

4. Comment: One employee expressed concern that the Defense Finance

and Accounting System (DFAS) can't handle formula driven payroll now,

therefore, how can DFAS be expected to handle the new payroll system

under the demo?

Response: Management from DFAS has been involved as DoD Research

and Development Laboratories have moved towards implementing

demonstration projects. Every effort is being made to allow for a

smooth transition.

2. Demonstration Project System Changes

The following summarizes the changes and clarifications to the

project plan that were of paramount interest to employees:

(1) Section II. E (Participating Employees). Deleted reference to

ST employees following performance appraisal and awards provisions of

the demonstration project.

(2) Section III. C (Pay for Performance Management System). Deleted

the annual general increase from the funding for performance pay

increases and/or bonuses, and to correct the computation in the example

from ``1,750,000'' to ``750,000''; adjusted shares to the following:

``A''=2 shares, ``B''=1 share, ``C''=0; and reflected modifications

required due to the withdrawal of the annual general increase from the

performance pay pool funding. In addition, references to mid-point

(upper/lower pay band) within a pay band have been deleted since they

no longer apply.

(3) Section III. C (Pay for Performance Management System).

Clarified the reason for granting a supervisory bonus and that funding

for such will not be part of the performance pay pool.

(4) Section III. F (Revised Reduction in Force (RIF) Procedures).

Clarified when service computation date (length of service) will be

used in RIF procedures.

(5) Section V (Conversion). Provided for certain pay increases for

non-competitive promotion equivalents during the first 12 months

following conversion.

Dated: February 26, 1998.

Office of Personnel Management.

Janice R. Lachance,

Director.

Table of Contents

I. Executive Summary

II. Introduction

A. Purpose

[[Page 10443]]

B. Problems with the Present System

C. Changes Required/Expected Benefits

D. Participating Organization

E. Participating Employees

F. Labor Participation

G. Project Design

H. Personnel Management Board

III. Personnel System Changes

A. Broadbanding

B. Classification

C. Pay-for-Performance Management System

D. Hiring and Appointment Authorities

E. Expanded Developmental Opportunities Program

F. Revised Reduction-In-Force (RIF) Procedures

IV. Training

V. Conversion

VI. Project Duration

VII. Evaluation Plan

VIII. Demonstration Project Costs

IX. Required Waivers to Law and Regulation

Appendix A: Occupational Series by Occupational Family

Appendix B: Project Evaluation and Oversight

Appendix C: Performance Elements

Appendix D: Benchmark Performance Standards

I. Executive Summary

This project was designed by the Department of the Army (DA), with

participation of and review by the Department of Defense (DoD) and the

Office of Personnel Management (OPM). The purpose of the project is to

achieve the best workforce for the Medical Research & Materiel Command

(MRMC) mission, adjust the workforce for change, and improve workforce

quality.

The MRMC strives to exceed the greatest expectations of its many

customers. To achieve this, the MRMC must be able to balance customer

requirements for near-term technical and scientific products and

information with the evolving capabilities of the workforce. These

purposes will be significantly enhanced by interventions such as

expanded developmental opportunities, the contingent employee

appointment authority, broadbanding, pay for performance, etc.

The foundations of this project are based on the concept of linking

performance to pay for all covered positions; simplifying paperwork and

the processing of classification and other personnel actions;

emphasizing partnerships among management, employees and unions

representing covered employees; and delegating classification and other

authorities to line managers. Additionally, the research intellect of

the MRMC workforce will be revitalized through the use of expanded

developmental opportunities. The use of these expanded opportunities

will reinvigorate the creative intellect of the research and

development community.

Development and execution of this project will be in-house budget

neutral, based on a baseline of September 1996 in-house costs and

consistent with the DA plan to downsize laboratories. Army managers at

the DoD S&T Reinvention Laboratory sites will manage and control their

personnel costs to remain within established in-house budgets. An in-

house budget is a compilation of costs of the many diverse components

required to fund the day-to-day operations of a laboratory. These

components generally include pay of people (labor, benefits, overtime,

awards), training, travel, supplies, non-capital equipment, and other

costs depending on the specific function of the activity.

This project will be under the joint sponsorship of the Assistant

Secretary of the Army for Research, Development and Acquisition and the

Assistant Secretary of the Army for Manpower and Reserve Affairs. The

Commander, U.S. Army Medical Command (MEDCOM), will execute and manage

the project. External project oversight within the Army will be

achieved by an executive steering committee made up of top-level

executives, co-chaired by the Deputy Assistant Secretary of the Army

for Research and Technology and the Deputy Assistant Secretary of the

Army (Civilian Personnel Policy). Oversight external to the Army will

be provided by DoD and OPM.

II. Introduction

A. Purpose

The purpose of the project is to demonstrate that the effectiveness

of DoD laboratories can be enhanced by allowing greater managerial

control over personnel functions and, at the same time, expanding the

opportunities available to employees through a more responsive and

flexible personnel system. The quality of DoD laboratories, their

people, and products has been under intense scrutiny in recent years.

The perceived deterioration of quality is due, in substantial part, to

the erosion of control which line managers have over their human

resources. This demonstration, in its entirety, attempts to provide

managers, at the lowest practical level, the authority, control, and

flexibility needed to achieve quality laboratories and quality

products.

B. Problems with the Present System

The MRMC provides medical solutions for military requirements to

protect and sustain the force. To do this, its management must acquire

and retain an enthusiastic, innovative, and highly educated/trained

workforce. The MRMC must be able to compete with the private sector for

the best talent and be able to make job offers in a timely manner with

the attendant bonuses and incentives to attract high quality employees.

Today, industry laboratories can make an offer of employment to a

promising new hire before the government can prepare the paperwork

necessary to begin the recruitment process.

Currently, jobs are described using a classification system that is

overly complex and specialized. This hampers a manager's ability to

shape the workforce and match the positions while making best use of

the employees. Managers must be given local control of positions and

their classification to move both their employees and vacancies freely

within their organization to other lines of the business activities to

match the life cycle needs of supported customers.

These issues work together to hamper supervisors in all areas of

human resource management. Hiring restrictions and overly complex job

classifications, coupled with poor tools for rewarding and motivating

employees and a system that does not assist managers in removing poor

performers, builds stagnation in the workforce and wastes valuable

time.

C. Changes Required/Expected Benefits

This project is expected to demonstrate that a human resource

system tailored to the mission and requirements of the MRMC will result

in: (a) Increased quality in the total workforce and the products they

produce; (b) increased timeliness of key personnel processes; (c)

increased retention of high quality employees and increased non-

retention of poor quality employees; and (d) increased satisfaction

with the MRMC and its products by all customers served.

The MRMC demonstration project builds on the successful features of

demonstration projects at China Lake and the National Institute of

Standards and Technology (NIST). These demonstration projects have

produced impressive statistics on the job satisfaction for their

employees versus that for the federal workforce in general. Therefore,

in addition to expected benefits mentioned above, the MRMC

demonstration project expects to find more satisfied employees on many

aspects of the demonstration project including pay equity,

classification accuracy, and fairness of performance management. A full

range of measures

[[Page 10444]]

will be collected during Project Evaluation (Section VII).

D. Participating Organization

This demonstration project will cover approximately 1,000 MRMC

civilian employees at all geographic sites within the United States. It

should be noted that many sites currently employ fewer than 10 people

and that the sites may change as the MRMC reorganizes, realigns, and

complies with Base Realignment and Closure Act requirements. Successor

organizations will continue coverage in the demonstration project.

Approximately 46 percent of covered employees are located at Fort

Detrick, Frederick, Maryland. The remaining employees are located at

the following sites: Aberdeen Proving Ground, Maryland; Falls Church,

Virginia; Fort Rucker, Alabama; Fort Sam Houston, Texas; Natick,

Massachusetts; Washington, DC; Tobyhanna Army Depot, Pennsylvania; Fort

Lee, Virginia; Tracy, California; Ogden, Utah; Brooks Air Force Base,

Texas; Dayton, Ohio; Tripler Army Medical Center, Hawaii; and Fort

Bragg, North Carolina. Additionally, the MRMC has some employees

participating in the Flexiplace Program who are geographically located

at Fort Collins, Colorado; Clarksville, Tennessee; and Jefferson,

Maryland.

E. Participating Employees

The demonstration project includes appropriated funded civilian

employees in the competitive and excepted service (to include non-

citizens hired in the absence of qualified citizens) paid under the

General Schedule (GS) pay system and DA Interns. The project plan does

not cover Senior Executive Service (SES) employees, Scientific and

Professional (ST) employees, Federal Wage System employees, and

employees assigned to the GS-080 series and presently covered by the

Civilian Intelligence Personnel Management System (CIPMS). Employees on

temporary appointments will not be covered in the demonstration

project. Personnel added to the MRMC in like positions, either through

appointment, promotion, reassignment, change to lower grade or where

their functions and positions have been transferred into the MRMC, will

be converted to the demonstration project.

F. Labor Participation

The National Federation of Federal Employees (NFFE) and the

American Federation of Government Employees (AFGE), represent

professional and nonprofessional GS employees at some sites within the

MRMC. The MRMC will fulfill its obligations to consult and/or negotiate

with the NFFE and AFGE, as appropriate, in accordance with 5 U.S.C.

4703(f) and 7117. The participation with the NFFE, and AFGE is within

the spirit and intent of Executive Order 12871. The bargaining units of

MRMC not endorsing the demonstration project will not participate.

G. Project Design

In October 1994, the MRMC began development of the specifics of

this personnel demonstration proposal. A Personnel Demonstration

Project Office was established and administrative support added in

April 1995. Briefings of the proposal were initially conducted for the

workforce at every participating subordinate activity with subsequent

briefings provided upon request by Commanders/Directors.

Status of the project was provided to subordinate activity

Commanders/Directors for dissemination to all employees. An electronic

mail address was established in the Fall of 1994 and made available to

all employees and managers for the purpose of expressing opinions and/

or obtaining specific information about the project.

Review of the proposal and input by the MEDCOM, MRMC workforce, as

well as critical and extensive reviews by Headquarters DA, the Office

of the Secretary of Defense, and OPM since April 1995, led to the

publication of the proposal in the March 12, 1997 Federal Register.

Subsequently, Public Hearings were held, and comments from interested

parties and the workforce were reviewed and considered, culminating in

the publication of the final MRMC demonstration project plan.

H. Personnel Management Board

The MRMC intends to establish an appropriate balance between the

personnel management authority/accountability delegated to subordinate

activity Commanders/ Directors and MRMC management/oversight

responsibilities by establishing a Personnel Management Board (PMB).

The Chairperson and members will be appointed by the Commander MRMC.

The PMB will serve to provide oversight, policy, guidelines, corrective

action, and evaluation as subordinate activity Commanders/Directors

execute the following:

1. formulate and execute the civilian pay budget;

2. determine the composition of the pay-for-performance pay pools

in accordance with the guidelines of this proposal and internal

procedures;

3. administer funds allocation to pay pool managers;

4. determine hiring and promotion salaries as well as exceptions to

pay-for-performance salary increases;

5. provide guidance to pay pool managers;

6. manage the awards pools;

7. select participants for the Expanded Developmental Opportunities

Program, long term training, and any special developmental assignments;

8. adhere to guidelines concerning the promotion of employees into

salary ranges designated ``high grades';

9. ensure in-house budget neutrality to include tracking of average

salaries, FTEs, etc.;

10. contact the PMB designee for problem resolution, recommending

changes in policy/procedure, etc.; and

11. ensure that all employees are treated in a fair and equitable

manner in accordance with all policies, regulations, and guidelines

covering this demonstration project.

III. Personnel System Changes

A. Broadbanding

Occupational Families

Occupations at the MRMC will be grouped into occupational families.

Occupations will be grouped according to similarities in type of work

and customary requirements for formal training or credentials. The

common patterns of advancement within the occupations as practiced at

DoD Laboratories and in the private sector will also be considered. The

current occupations and grades have been examined, and their

characteristics and distribution have served as guidelines in the

development of the four occupational families described below.

Positions included in each occupational family are listed in Appendix

A.

1. Engineers and Scientists. This occupational family includes all

technical professional positions, such as positions in the biological,

physical and social sciences, medical, veterinary, mathematical, and

engineering fields. Ordinarily, specific course work or educational

degrees are required for these occupations.

2. E&S Technicians. This occupational family contains specialized

functions in fields that provide direct technical support to the

scientific/engineering effort. Positions in these occupations may or

may not require completion of formal college course work. However,

training and skills in the various specialties are generally required.

3. Administrative. This occupational family contains specialized

functions in

[[Page 10445]]

such fields as management analysis, accounting, budgeting, contracting,

purchasing, legal, business and industry, library, quality assurance,

and supply. Special skills in administrative fields or special degrees

are required.

4. General Support. This occupational family is composed of

positions requiring special skills and knowledge, such as typing,

shorthand, or office automation skills, and job related experience.

Clerical work usually involves the processing and maintenance of

records. Assistant work requires knowledge of methods and procedures

within a specific administrative area. Support functions include

positions such as secretary, mail clerk, medical clerk, accounting

technician and supply technician.

Pay Bands

Each occupational family will be composed of discrete pay bands

(levels) corresponding to recognized advancement within the

occupations. These pay bands will replace grades. They will not be the

same for all occupational families. Each occupational family will be

divided into three to five pay bands, each pay band covering the same

pay range now covered by one or more grades. A salary overlap, similar

to the current overlap between GS grades, will be maintained.

Ordinarily, an individual will be hired at the lowest salary in a

pay band. Exceptional qualifications, specific organizational

requirements, or other compelling reasons may lead to a higher entrance

level within a band.

The MRMC broadbanding plan expands the broadbanding concept used at

China Lake and NIST by creating Pay Band V of the Engineers and

Scientists Occupational Family. This pay band is designed for Senior

Scientific Technical Managers.

Current OPM guidelines of Senior Executive Service (SES) and

Scientific and Professional (ST) positions do not fully meet the needs

of MRMC. The SES designation is appropriate for executive level

managerial positions whose classification exceeds the GS-15 grade

level. The primary knowledges and abilities of SES positions relate to

supervisory and managerial responsibilities. Positions classified as ST

are reserved for bench research scientists and engineers; these

positions require a very high level of technical expertise and they

have little or no supervisory responsibility.

MRMC currently has many positions, typically division/directorate

chiefs, that have characteristics of both SES and ST classifications.

Most division/directorate chiefs in MRMC are responsible for

supervising other GS-15 positions, including branch chiefs, non-

supervisory researcher scientists and engineers, and possibly ST

positions. Most division/directorate chief positions are classified at

the GS-15 level, although their technical expertise warrants

classification beyond GS-15. Because of their management

responsibilities, these individuals are excluded from the ST system.

Because of management considerations, they cannot be placed in the SES.

Management considers the primary requirement for division/directorate

chiefs to be knowledge of, and expertise in, the specific scientific

and technology areas related to the mission of their divisions/

directorates. Historically, incumbents of these positions have been

recognized within the community as scientific and engineering leaders,

who possess primarily scientific/engineering credentials and are

considered experts in their field. However, they must also possess

strong managerial and supervisory abilities. Therefore, although some

of these employees have scientific credentials that might compare

favorably with ST criteria, classification of these positions as STs is

not an option, because the managerial and supervisory responsibilities

inherent in the positions cannot be ignored.

The purpose of Pay Band V (which will reinforce the equal pay for

equal work principle) is to solve a critical classification problem. It

will also contribute to an SES ``corporate culture'' by excluding from

the SES positions for which technical expertise is paramount. Pay Band

V proposes to overcome the difficulties identified above by creating a

new category of positions, the Senior Scientific Technical Manager,

which has both scientific/technical expertise and full managerial and

supervisory authority.

Current GS-15 division/directorate chiefs will convert into the

demonstration project at Pay Band IV. After conversion, they will be

reviewed against established criteria to determine if they should be

reclassified to Pay Band V. Other positions possibly meeting criteria

for classification to Pay Band V will be reviewed on a case-by-case

basis. The proposed salary range is a minimum of 120% of the minimum

rate of basic pay for GS-15 with a maximum rate of basic pay

established at the rate of basic pay (excluding locality pay) for SES

level 4 (ES-4). Vacant positions in Pay Band V will be competitively

filled to ensure that selectees are preeminent researchers and

technical leaders in the specialty fields who also possess substantial

managerial and supervisory abilities. MRMC will capitalize on the

efficiencies that can accrue from central recruiting by continuing to

use the expertise of the Army Materiel Command SES Office as the

recruitment agent. Panels will be created to assist in filling Pay Band

V positions. Panel members will be selected from a pool of current MRMC

senior military and SES members, ST employees, and later those in Pay

Band V, and an equal number of individuals of equivalent stature from

outside the activity to ensure impartiality, diversity, breadth of

technical expertise, and a rigorous and demanding review. The panel

will apply criteria developed largely from the current OPM Research

Grade Evaluation Guide for positions exceeding the GS-15 level.

DoD will test the establishment of Pay Band V for a five-year

period. Positions established in Pay Band V will be subject to

limitations imposed by OPM and DoD. Pay Band V positions will be

established only in an S&T Reinvention Laboratory which employs

scientists, engineers, or both. Incumbents of Pay Band V positions will

work primarily in their professional capacity on basic or applied

research and secondarily perform managerial or supervisory duties. The

number of Pay Band V positions within the DoD will not exceed 40. These

40 positions will be allocated by ASD (FMP), DoD, and administered by

the respective Services. The number of Pay Band V positions will be

reviewed periodically to determine appropriate position requirements.

Pay Band V position allocations will be managed separately from SES,

ST, and SL positions. An evaluation of the Pay Band V concept will be

performed during the fifth year of the demonstration project.

The final component of Pay Band V is the management of all Pay Band

V assets. Specifically, this authority will be exercised at the DA

level, and includes the following: authority to classify, create, or

abolish positions within limitations imposed by OPM and DoD; recruit

and reassign employees in this pay band; set pay and to have their

performance appraised under this project's Pay for Performance System.

The laboratory wants to demonstrate increased effectiveness by gaining

greater managerial control and authority, consistent with merit,

affirmative action, and equal employment opportunity principles.

High-grade controls within the agency currently restrict movement

into high grade positions (GS-14/15). OPM's definition of ``high grade

position'' is a position where the base pay exceeds

[[Page 10446]]

that of a GS-13, Step 10. Unless the high-grade controls are lifted,

demonstration employees will not be able to advance into the currently

defined pay level of a high-grade, unless a high-grade authorization is

available. To accommodate this, employees whose salary adjustment would

place them above the high-grade pay limit in activities where high-

grade authorizations are unavailable will receive permanent adjustments

to basic salary up to an amount equivalent to one dollar less than the

base of the defined high-grade pay structure. Any additional amount

granted under pay-for-performance will be paid as a one-time bonus

payment from pay-pool funds. This pattern of payout will continue until

high-grade authorizations become available.

The proposed pay bands for the occupational families and how they

relate to the current GS grades are shown in Figure 1. Application of

the Fair Labor Standards Act (FLSA) within each pay band is also shown

in Figure 1. This pay band concept has the following advantages:

1. It reduces the number of classification decisions required

during an employee's career.

2. It simplifies the classification decision-making process and

paperwork. A pay band covers a larger scope of work than a grade, and

thus will be defined in shorter and simpler language.

3. It supports delegation of classification authority to line

managers.

4. It provides a broader range of performance-related pay for each

level. In many cases, employees whose pay would have been frozen at the

top step of a grade will now have more potential for upward movement in

the broader pay band.

5. It prevents the progression of low performers through a pay band

by mere longevity, since job performance serves as the basis for

determining pay.

Figure 1.--Occupational Families and Pay Bands

------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Corresponding GS grades

-----------------------------------------------------------------------------------------------------------------------------------------------

Occupational Families Above

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 15

------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

(15)BANDS

-----------------------------------------------------------------------------------------------------------------------------------------------

Engineers & Scientists (DB).....................

(3)I

(7)II

(1)III IV V

(3)(N)

(7)(*)

(1)(E) (E) (E)

-----------------------------------------------------------------------------------------------------------------------------------------------

E&S Technicians (DE)............................

(3)(I)

(3)II

(2)III

(1)IV

(3)(N)

(3)(*)

(2)(*)

(1)(E)

-----------------------------------------------------------------------------------------------------------------------------------------------

Administrative (DJ).............................

(3)I

(5)II

(1)III

(1)IV V

(3)(N)

(5)(*)

(1)(E)

(1)(E) (E)

-----------------------------------------------------------------------------------------------------------------------------------------------

General Support (DK)............................

(3)I

(3)II

(1)III

(3)(N)

(3)(*)

(1)(*)

------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

FLSA CODES: N--Nonexempt E--Exempt *--Nonexempt or Exempt

Note: Although typical exemption status under the various pay bands is shown in the above table, actual FLSA exemption determinations are made on a case-by-case basis.

Fair Labor Standards Act

The FLSA exemption and nonexemption determinations will be made

consistent with criteria found in 5 CFR Part 551. Supervisors with

classification authority will make the determinations on a case-by-case

basis with reference to documentation in the operating procedures

manual and the advice and assistance of the Civilian Personnel Offices

(CPO)/Civilian Personnel Advisory Centers (CPAC)/Civilian Personnel

Operations Centers (CPOC). The generic position descriptions will not

be the sole basis for the determination. The basis for exemption/non-

exemption will be documented and attached to each description.

Exemption criteria will be narrowly construed and applied only to those

employees who clearly meet the spirit of the exemption. The basis for

determinations will be reviewed as a part of the performance review

process and when salary adjustments are warranted. Changes will be

documented and provided to the CPO/CPAC/CPOC, as appropriate.

Simplified Assignment Process

Today's environment of rightsizing and workforce transition

mandates that the MRMC have maximum flexibility to assign duties and

responsibilities to individuals. Broadbanding can be used to address

this need. As a result of the assignment to a particular level

descriptor, the organization will have maximum flexibility to assign an

employee with no change in basic pay, within broad descriptions

consistent with the needs of the organization, and the individual's

qualifications and rank or level. Subsequent assignments to projects,

tasks, or functions anywhere within the organization requiring the same

level and area of expertise, and qualifications would not constitute an

assignment outside the scope or coverage of the current level

descriptor, or benchmark position description.

Such assignments within the coverage of the generic descriptors are

accomplished without the need to process a personnel action. For

instance, a technical expert can be assigned to any project, task, or

function requiring similar technical expertise. Likewise, a manager

could be assigned to manage any similar function or organization

consistent with that individual's qualifications. This flexibility

allows a broader latitude in assignments and further streamlines the

administrative process and system.

Promotions

A promotion is the movement of an employee to a higher pay band

within the same occupational family or to a pay band in a different

occupational family which results in an increase in the employee's

salary. Progression within a pay band is based upon performance pay

increases; as such, these actions are not considered promotions and are

not subject to the provisions of this section.

Promotions will be processed under competitive procedures in

accordance with merit principles and requirements. The following

actions are excepted from competitive procedures:

(a) Re-promotion to a position which is in the same pay band and

occupational family as the employee previously held on a permanent

basis within the competitive service.

(b) Promotion, reassignment, demotion, transfer or reinstatement to

a position having promotion potential no greater than the potential of

a position an employee currently holds or previously held on a

permanent basis in the competitive service.

(c) A position change permitted by reduction-in-force procedures.

[[Page 10447]]

(d) Promotion without current competition when the employee was

appointed through competitive procedures to a position with a

documented career ladder.

(e) A temporary promotion, or detail to a position in a higher pay

band, of 180 days or less.

(f) Impact of person on the job, accretion of duties, and Factor IV

process (application of the Research Grade Evaluation Guide, Equipment

Development Grade Evaluation Guide or similar guides) promotions.

(g) A promotion resulting from the correction of an initial

classification error or the issuance of a new classification standard.

Link Between Promotion and Performance

To be promoted competitively or noncompetitively from one band to

the next, an employee must meet the minimum qualifications for the job

and have a current performance rating of ``B'' or better (see

Performance Evaluation) or equivalent under a different performance

management system.

B. Classification

Introduction

The objectives of the new classification system are to simplify the

classification process, make the process more serviceable and

understandable, and place more decision-making authority and

accountability with line managers. All positions listed in Appendix A

will be in the classification structure. Provisions will be made for

including other occupations as employment requirements change in

response to changing missions and technical programs.

Occupational Series

The present GS classification system has over 400 occupations (also

called series), which are divided into 22 groups. The occupational

series will be maintained. New series, established by OPM, may be added

as needed to reflect new occupations in the workforce. Appendix A lists

the occupational series currently represented at the MRMC by

occupational family.

Classification Standards

MRMC will use a classification system that is a modification of the

system now in use at the US Navy, Naval Command, Control and Ocean

Surveillance Center, San Diego, California. The present classification

standards will be used to create local benchmark position descriptions

for each pay band, reflecting duties and responsibilities comparable to

those described in present classification standards for the span of

grades represented by each pay band. There will be at least one

benchmark position description for each pay band. A supervisory

benchmark position description will be added to those pay bands that

include supervisory employees. Present titles and series will continue

to be used in order to recognize the types of work being performed and

educational backgrounds and requirements of incumbents. Locally

developed speciality codes and OPM functional codes will be used to

facilitate titling, making qualification determinations, and assigning

competitive levels to determine retention status.

Position Descriptions and Classification Process

The MRMC Commander will have delegated classification authority and

will redelegate this authority to subordinate activity Commanders/

Directors for redelegation to activity managers as appropriate. New

position descriptions will be developed to assist managers in

exercising delegated position classification authority. Managers will

identify the occupational family, job series, the functional code, the

speciality code, pay band level, and the appropriate acquisition codes.

The manager will document these decisions on a cover sheet similar to

the present DA Form 374. Speciality codes will be developed by Subject

Matter Experts (SMEs) to identify the special nature of work performed.

Functional codes are those currently found in the OPM Introduction to

the Classification Standards which defines certain kinds of activities,

e.g., Research, Development, Test and Evaluation, etc., and covers

Engineers & Scientists (E&S).

Classification Appeals

An employee may appeal the occupational series or pay band level of

his or her position at any time. An employee must formally raise the

areas of concern to supervisors in the immediate chain of command,

either verbally or in writing. If an employee is not satisfied with the

supervisory response, he or she may then appeal to the DoD appellate

level. If an employee is not satisfied with the DoD response, he or she

may then appeal to the Office of Personnel Management, only after DoD

has rendered a decision under the provisions of this demonstration

project. Appellate decisions from OPM are final and binding on all

administrative, certifying, payroll, disbursing, and accounting

officials of the Government. Time periods for case processing under

Title 5 apply. An employee requesting a classification decision that

would exceed the equivalent of a GS-15 level may not submit the appeal

to OPM.

An employee may not appeal the assignment of the occupational

series to an occupational family; the accuracy of the occupational

family; the title of a position; the accuracy of the position

description; the demonstration project classification criteria, or the

pay-setting criteria; the propriety of a salary schedule; or matters

grievable under an administrative or negotiated grievance procedure or

an alternative dispute resolution procedure.

The evaluation of classification appeals under this demonstration

project are based upon the demonstration project classification

criteria. Case files will be forwarded for adjudication through the

CPO/CPAC/CPOC providing personnel services and will include copies of

appropriate demonstration project criteria.

C. Pay-for-Performance Management System

Performance Evaluation

Introduction

The performance appraisal system will link compensation to

performance through annual performance evaluations and performance

ratings. The performance appraisal system will allow optional use of

peer evaluation input and/or input from subordinates whenever

appropriate. The system will have the flexibility to be modified, if

necessary, as more experience is gained under the project. Details of

the system may be found in the implementing instructions.

Performance Objectives

Performance objectives are statements of job responsibilities based

on the work unit's mission, goals, and supplemental benchmark position

descriptions. Employees and supervisors will jointly develop

performance objectives which will reflect the types of duties and

responsibilities expected at the respective pay level. Absent agreement

between employees and supervisors, final authority to establish

performance objectives and element weights rests with line management.

The performance objectives, representing joint efforts of employees and

their rating chains, should be in place within 30 days from the

beginning of each rating period.

Performance Elements

New performance elements and rating forms will be designed to

implement a new scoring and rating system. The new

[[Page 10448]]

performance evaluation system will be based on critical performance

elements defined in Appendix C. All elements in the new performance

evaluation system are critical. Non-critical elements will not be used.

Each performance element is assigned a weight between a specified

range. The total weight of all elements in a performance plan is 100

points. The supervisor assigns each element some portion of the 100

points in accordance with its importance for mission attainment. These

weights will be developed along with employee performance objectives.

Mid-Year Review

A mid-year review between a supervisor and employee will be held to

determine whether objectives are being met and whether performance

objectives should be modified to reflect changes in planning, workload,

and resource allocation. Additional reviews may be held as deemed

necessary by the supervisor. The weights assigned to performance

elements will be changed, if necessary.

Performance Appraisal

A performance appraisal is scheduled for the final weeks of the

annual performance cycle, although an individual performance appraisal

may be conducted at any time after 60 days on approved standards. The

performance appraisal process brings supervisors and employees together

for formal discussions on performance and results in (1) written

appraisals, (2) performance ratings, (3) performance pay increases and/

or bonuses, (4) cash awards, and (5) other individual performance-

related actions, as appropriate. A performance appraisal may consist of

two meetings held between employee and supervisor: the performance

review meeting and the evaluation feedback meeting.

Performance Review Meeting Between Employee and Supervisor

The review meeting is to discuss job performance and

accomplishments. Supervisors do not assign scores, ratings, pay

increases, or awards at this meeting. The supervisor notifies the

employee of the review meeting in time to allow the employee to prepare

a list of accomplishments. Employees will be given an opportunity at

the meeting to give a personal performance assessment and describe

accomplishments. The supervisor and employee discuss job performance

and accomplishments in relation to the performance elements,

objectives, and planned activities established in the performance plan.

Evaluation Feedback Meeting Between Employee and Supervisor

In this second meeting between employee and supervisor, the

supervisor informs the employee of management's appraisal of the

employee's performance, the employee's performance score and rating,

and any recommended related pay increase, bonus, award, or other

personnel action. During this second meeting, the supervisor and

employee will discuss and document performance objectives for the next

rating period.

Performance Scores

Selection of the weighted points to assign to an employee's

performance is assisted by use of benchmark performance standards

(appendix D). Each benchmark performance standard describes the level

of performance associated with a particular point on a rating scale.

Supervisors may add supplemental standards to the performance plans of

the employees they supervise to further elaborate the benchmark

performance standards.

The overall score is the sum of the individual element scores.

Employees will receive an academic-type rating of ``A'', ``B'', ``C'',

or ``F'' depending upon the percentage of goal attainment. These

summary ratings are representative of Pattern E in Summary Level Chart

in 5 CFR 430.208(d)(1). This rating will become the rating of record,

and

(1) Employees rated ``B'' or higher will be eligible to receive

performance-based pay increases and/or bonuses; and

(2) Retention years credit for RIF will be received by employees

rated ``C'' or higher. (Note: except when a PIP does not result in an

annual rating of ``C'' prior to the end of the rating cycle).

(3) Employees rated ``F'' will not receive the general increase,

retention years credit for RIF, or be eligible to receive performance

based pay increases and/or bonuses.

A rating of ``A'' will be assigned for cumulative scores of 85 to

100 points, ``B'' for cumulative scores of 70 through 84, and ``C'' for

cumulative scores of 50 through 69. An overall rating of ``F''

indicates failure to perform at the 50 percent level for any one of the

assigned weighted elements. (In such a case, even though the cumulative

score may exceed 49, the employee will nonetheless receive an overall

rating of ``F''. NOTE: An ``F'' constitutes an unacceptable rating).

The academic-type ratings will be used to determine pay or bonus values

and to award additional RIF retention years as follows:

------------------------------------------------------------------------

RIF

Compensation Retention General

Rating (shares) years increase \2\

added

------------------------------------------------------------------------

``A''......................... 2 10 YES

``B''......................... 1 7 YES

``C''......................... 0 3 YES

``F''......................... 0 0 NO

------------------------------------------------------------------------

\1\ Employees rated ``B'' or higher will be eligible to receive

performance-based pay increases and/or bonuses. Retention years credit

for RIF will be received by employees rated ``C'' or higher, except

when a PIP does not result in an annual rating of ``C'' prior to the

end of the rating cycle.

\2\ The maximum pay rate for pay band V cannot exceed rate for ES-4.

Therefore, employees at or near the top pay band V may not receive the

full general increase if it is not authorized for SES employees.

Performance Based Actions

MRMC will implement a two step process to deal with poor

performers. This process may lead to involuntary separations if the

employee receives a score of less than 50 percent of the points for any

weighted element.

The process will begin with the recognition that an employee's

performance is unacceptable (any element that would be rated at less

than the 50 percent level of its assigned benchmark weight). The two

steps are as follows: (1) Performance improvement plan (PIP), and (2)

separation.

When the employee is determined to be performing below the 50%

level for any element, the supervisor and employee will develop a

structured PIP that will be monitored for a reasonable period of time.

If the employee fails to improve during this structured plan, the

employee will be given notice of proposed appropriate action. The

activity may consider a change in assignment or reduction in pay as

[[Page 10449]]

opposed to removal if the mission, organizational structure and

available resources warrant such action. If employees are separated,

they will have due process recourse as a former employee.

(Note: Performance based adverse actions may be taken under 5

U.S.C., Chapter 75 or Chapter 43).

Actions taken under Chapter 75 do not require a PIP.

If a PIP ends prior to the end of the annual performance cycle and

the employee's performance improves to the 50% or above level in all

assigned elements, the employee is appraised again at the end of the

annual performance cycle.

If, in conjunction with the completion of the PIP, the employee

attains an annual rating of ``C'' or higher, they will receive the

annual general increase and RIF retention years credit will be earned.

In addition, employees attaining an annual rating of ``B'' or higher

will also be eligible for an increase to base pay and/or bonus.

If a PIP ends after the end of the annual performance cycle and the

employee's performance has improved to the 50% or above level in all

assigned elements, employment continues but no retroactive annual

general increase, performance bonus, or RIF retention years credit is

granted for that performance cycle period.

Employee Relations

Employees covered by the project will be evaluated under a

performance evaluation system that affords grievance rights comparable

to those provided currently. The MRMC will maintain the substantive and

procedural appeal rights currently afforded when taking action for

misconduct and poor performance.

Awards

The MRMC currently has an extensive awards program consisting of

both internal and external awards. While not linked to the pay-for-

performance system, awards will continue to be given for special acts

and other categories as they occur. Awards may include, but are not

limited to, special acts, patents, suggestions, on-the-spot, and time-

off, and may be modified or expanded as appropriate. Major Army Command

(MACOM) and DoD awards and other honorary noncash awards will be

retained.

In an effort to foster and encourage team work among its employees,

a Commander/Director may allocate a sum of money to a team for

outstanding completion of a special task or significant achievement,

and the team may decide the individual distribution of the total

dollars among themselves.

Pay Administration

Introduction

The objective is to establish a pay system that will improve the

ability of the MRMC to attract and retain quality employees. The new

system will be a pay-for-performance system and, when implemented, will

result in a redistribution of pay resources based upon individual

performance.

Pay-for-Performance

MRMC will use a simplified performance appraisal system that will

permit both the supervisor and the employee to focus on quality of the

work. The proposed system will permit the manager/supervisor to base

compensation on performance or value added to the goal of the

organization rather than on longevity and risk aversion. This system

will allow managers to withhold pay increases from nonperformers,

thereby giving the nonperformer the incentive to improve performance or

leave government service.

Pay-for-performance has two components: Performance pay increases

(i.e. base pay increases) and/or bonuses. All covered employees will be

given the full amount of locality pay adjustments (as applicable) when

they occur, regardless of performance. The funding for performance pay

increases and/or bonuses is composed of money previously available for

within-grade increases, quality step increases, and promotions from one

grade to another when the grades are now in the same pay band.

Performance Pay Pool

The funding in the performance pay pool will be used for base pay

increases and/or performance bonus pay. The payouts made to employees

from the performance pay pool may be a mix of base pay increases,

subject to the pay ceiling in the pay bands, and bonus payments.

The Headquarters, MRMC Comptroller, in conjunction with each

subordinate activity Commander/Director, will calculate the total

performance pay pool and allocate pay pools to subordinate activities.

Each subordinate activity Commander/Director will allocate pay pools to

organizational units or teams as appropriate.

Performance Pay Increases and/or Performance Bonuses

A pay pool manager is accountable for staying within pay pool

limits. The pay pool manager assigns pay increases and/or bonuses to

individuals on the basis of an academic-type rating, the value of the

performance pay pool resources available, and the individual's current

basic rate of pay within a given pay band. A pay pool manager may

request approval from the Commander/Director or his/her designee to

grant a higher performance pay increase/performance bonus than is

generated by the compensation formula to recognize an employee's

extraordinary achievement or to provide accelerated compensation for

local interns.

A performance payout will be initially calculated for each

individual based upon a pay pool assignment that will be composed of

monies outlined previously. For illustration purposes, approximately

2.4 percent of the value of the combined basic rates of pay of the

assigned employees will be used. A share will be calculated so that a

pay pool manager will not exceed the resources that are available in

the pay pool. The performance payout for an individual will be

determined as follows:

[GRAPHIC] [TIFF OMITTED] TN03MR98.000

Where:

Pool Value = 0.024 * SUM (SALk); K = 1 to n

n = number of employees in pay pool

N = Number of Shares (0-2) earned by an employee based on their

performance rating

SAL = An individual's basic rate of pay

SUM = The summation of the entities in parenthesis over the range

indicated

i = individual

To illustrate the formula, the basic rates of pay of the 10

employees in a pay pool, who each earn $50,000 per year, total to

$500,000. The employees earned a total of 15 shares based on their

[[Page 10450]]

ratings (5 individuals earned an ``A'' rating, and 5 individuals earned

a ``B'' rating). The pay pool value is then 2.4 percent of the sum of

$500,000, or $12,000. The individual performance payout being

determined is for an individual who earns $50,000 per year and receives

an ``A'' on the appraisal, thus earning 2 shares. Using the formula,

the individual performance payout is calculated by multiplying the pay

pool value, $12,000, by the individual basic rate of pay, $50,000, by

the number of shares earned, 2. This product is divided by the sum of

the products of the individual basic rates of pay times the number of

shares earned, or 750,000. The resulting individual performance payout

is $1,600.00 for the year.

An annual performance base pay increase could be all, none, or part

of the compensation formula depending on the current basic rate of pay

of the employee. Annual performance base pay increases will be limited

to the difference between the particular band pay cap and the

employee's current basic rate of pay, or total dollar value of shares,

whichever is less, with the balance converted to a performance bonus.

This means that employees whose basic rates of pay have reached the

upper limits of a particular pay band will receive most performance

compensation as a performance bonus. Cash bonuses will not become a

part of the employee's basic rate of pay. Employees receiving retained

rates are subject to special rules governing basic pay adjustments. An

employee receiving a retained rate whose performance rating is ``F'' at

the time of a general pay increase will receive no increase in the

retained rate. All other employees receiving a retained rate will

receive a general pay increase equal to 50 percent of the amount of the

increase in the maximum rate of basic pay payable for the pay band of

the employee's position.

Supervisory Bonus

Supervisory bonuses of up to 10% of the basic rate of pay may be

paid at the discretion of Commanders/Directors to supervisors with

employees in the same pay band. In exceptional cases (approved by HQ,

MRMC), supervisors who do not have employees in the same pay band may

be compensated up to 5% of basic rate of pay. Employees who qualify for

the bonus include supervisors in all occupational families with formal

supervisory authority meeting that required for coverage under the OPM

GS Supervisory Guide. The supervisory bonus is to recognize supervisory

responsibilities required of supervisors most often receiving the same

pay as non-supervisory subordinates. There are two situations in which

a supervisory bonus may be warranted:

(1) Supervisors may be granted up to 10 percent of the basic rate

of pay if they supervise employees within the same pay band or,

2) Up to 5 percent of the basic rate of pay for those supervising

employees in lower or other pay bands.

Note: Pay band V employees in the E&S occupational family are

excluded.

Bonuses, which must be negotiated annually, will not be treated as

basic pay and are not a part of the performance pay pool.

Because the bonus is paid at the beginning of the appraisal period,

if the individual leaves a supervisory position or is removed from

supervisory responsibilities (unless effected through RIF action), the

prorated portion of the bonus for the non-supervisory portion of the

performance year will be recovered as a debt due the Government. Before

any supervisory bonus is paid, the supervisor will sign an agreement to

make any required repayment.

Pay and Compensation Ceilings

An employee's total monetary compensation paid in a calendar year

may not exceed the basic rate of pay paid in level I of the Executive

Schedule consistent with 5 U.S.C. 5307 and 5 CFR Part 530, Subpart B.

In addition, each pay band will have its own pay ceiling, just as

grades do in the current system. Pay rates for the various pay bands

will be directly keyed to the GS rates, except the maximum rate for pay

band V of the engineer and scientist occupational family which cannot

exceed ES-4. Basic pay will be limited to the maximum rates payable for

each pay band, except for retained rates as previously described.

Pay Setting for Promotion

The minimum basic pay increase upon promotion to a higher pay band

will be 6 percent or the minimum rate of the new pay band. The maximum

amount of pay increase upon promotion will not exceed $10,000.

When a temporary promotion is terminated, the employee's pay

entitlements will be redetermined based on the employee's position of

record, with appropriate adjustments to reflect pay events during the

temporary promotion, subject to the specific policies and rules

established by MRMC. In no case may those adjustments increase the pay

for the position of record beyond the applicable pay range maximum

rate.

Placement in a Lower Pay Band

Employees who receive 50 percent or less of an assigned benchmark

score in any element or who are on a performance improvement plan at

the time pay determinations are made, do not receive performance

payouts or the general increase. This action may result in a base

salary that is identified in a lower pay band. This occurs because the

minimum rates of basic pay in a pay band increase as the result of the

general increase (5 U.S.C. 5303). This situation, (a reduction in band

level with no reduction in pay) will not be considered an adverse

action, nor will band retention provisions apply.

D. Hiring and Appointment Authorities

Hiring Authority

A candidate's basic eligibility will be determined using OPM's

Qualification Standards Handbook of General Schedule Positions.

Candidates must meet the minimum standards for entry into the payband.

For example if the payband includes positions in grades GS-5 and GS-7,

the candidates must meet the qualifications for positions at GS-5

level. Specific experience/education required will be determined based

on whether a position to be filled is at the lower or higher end of the

band. As a general rule, pay will be set at the lowest level in a pay

band. Appointments made above the minimum level will be based upon

superior qualifications of the candidate. A candidate appointed toward

the higher end of a pay band should have qualifications approaching the

lowest General Schedule grade incorporated into the next higher pay

band. For example, a person appointed at the higher end of Pay Band II

in the Engineers and Scientists Occupational Family would have

education, experience, or a combination of the two approaching the

qualifications of the GS-13 level, which is the lowest General Schedule

grade incorporated into Pay Band III. Under the demonstration

authority, the MRMC is authorized to modify by increasing QSH

qualifications and/or experience or substitutable education

requirements. Substitutable education can be modified; however, no

changes can be made to standards with positive education requirements

or minimum education requirements. In some cases, MRMC will update

these standards to reflect current practices in the occupational

families and modern curricula in recognized degree programs. Selective

placement factors may be established when judged to be critical to

successful job performance.

[[Page 10451]]

These factors must be communicated to all candidates for specific

vacancies and must be met for basic eligibility.

In the proposed system, as with the current system, the individual

manager will decide whether to fill a position from among internal

candidates or to recruit from outside.

The MRMC is committed to positive affirmative action and equal

employment opportunity goals. Line managers will be accountable for

understanding and implementing policies designed to meet these goals.

Appointment Authority

Under the demonstration project, there will continue to be career

and career conditional appointments. These appointments will use

existing authorities and entitlements. Non-permanent positions

(exceeding one year) needed to meet fluctuating or uncertain workload

requirements will be filled using a Contingent Employee appointment

authority.

Employees hired for more than one year, under the contingent

employee appointment authority are given term appointments in the

competitive service for no longer than five years. The MRMC Commander

is authorized to extend a contingent appointment one additional year.

These employees are entitled to the same rights and benefits as term

employees and will serve a one year trial period. The Pay-for

Performance Management System outlined in this Plan applies to

contingent employees.

Appointment will be made under the same appointment authorities and

processes as regular term appointments, but recruitment bulletins must

indicate that there is a potential for conversion to permanent

employment.

Employees hired under the contingent employee authority may be

eligible for conversion to career-conditional appointments. To be

converted, the employee must (1) have been selected for the term

position under competitive procedures, with the announcement

specifically stating that the individual(s) selected for the term

position(s) may be eligible for conversion to career-conditional

appointment at a later date; (2) served two years of substantially

continuous service in the term position; (3) be selected under merit

promotion procedures for the permanent position; and (4) have a current

rating of ``B'' or better.

Employees serving under regular term appointments at the time of

conversion to the demonstration project will be converted to the new

contingent employee appointments provided they were hired for their

current positions under competitive procedures. These employees will be

eligible for conversion to career-conditional appointment if they have

a current rating of ``B'' or better (or the equivalent of ``B'' in

their current evaluation system), and are selected under merit

promotion procedures for their permanent position after having

completed two years of continuous service. Time served in term

positions prior to conversion to the contingent employee appointment is

creditable, provided the service was continuous.

Extended Probationary Period

The current one-year probationary period will be extended to ``up

to three years'' for all newly hired employees in all pay bands. The

purpose of extending the probationary period is to allow supervisors an

adequate period of time to fully evaluate an employee's ability to

complete a research cycle and/or to fully evaluate an employee's

contribution and conduct. The length of the probationary period for the

Engineers and Scientists Occupational Family will be three years. The

probationary period for all other occupational families will be two

years.

Aside from extending the time period, all other features of the

current probationary period are retained including the potential to

remove an employee without providing the full substantive and

procedural rights afforded a non-probationary employee. Any employee

subject to serving a probationary period that was appointed prior to

the implementation date will not be affected. The ``up to three year''

probation will apply to new hires or those who do not have reemployment

rights or reinstatement privileges.

Probationary employees will be terminated when the employee fails

to demonstrate proper conduct, technical competency, and/or adequate

contribution for continued employment. When the MRMC decides to

terminate an employee serving a probationary period because his/her

work performance or conduct during this period fails to demonstrate

his/her fitness or qualifications for continued employment, it shall

terminate his/her services by written notification of the reasons for

separation and the effective date of the action. The information in the

notice as to why the employee is being terminated shall, as a minimum,

consist of the manager's conclusions as to the inadequacies of his/her

performance or conduct.

Supervisory Probationary Periods

Supervisory probationary periods will be made consistent with 5 CFR

315.901. Employees that have successfully completed the initial

probationary period will be required to complete an additional one-year

probationary period for the initial appointment to a supervisory

position. If, during the probationary period, the decision is made to

return the employee to a non-supervisory position for reasons solely

related to supervisory performance, the employee will be returned to a

comparable position of no lower pay band and basic pay than the

position from which he/she was promoted.

Voluntary Emeritus Program

Under the demonstration project, Commanders/Directors will have the

authority to offer retired or separated individuals voluntary

assignments in their activities. This authority will include

individuals who have retired or separated from Federal service.

Voluntary Emeritus Program assignments are not considered

``employment'' by the Federal Government (except for the purposes of

injury compensation). Thus, such assignments do not affect an

employee's entitlement to buy-outs or severance payments based on an

earlier separation from Federal service. The Voluntary Emeritus Program

will ensure continued quality research while reducing the overall

salary line by allowing individuals to accept retirement incentive with

the opportunity to retain a presence within their community. The

program will be of most benefit during manpower reductions as

individuals could accept retirement and return to provide valuable on-

the-job training or mentoring to less experienced individuals.

To be accepted into the emeritus program, a volunteer must be

approved by the subordinate activity Commander/Director. Everyone who

applies is not entitled to a voluntary assignment. The laboratory

Commander/Director must clearly document the decision process for each

applicant (whether accepted or rejected) and retain the documentation

throughout the assignment. Documentation of rejections will be

maintained for two years.

To ensure success and encourage participation, the individual's

Federal retirement pay (whether military or civilian) will not be

affected while serving in a voluntary capacity. Retired or separated

Federal individuals may accept an emeritus position without a break or

mandatory waiting period.

Volunteers will not be permitted to monitor contracts on behalf of

the government or to participate on any contracts where a conflict of

interest exists. The same rules that currently

[[Page 10452]]

apply to source selection members will apply to volunteers.

An agreement will be established between the volunteer, the

subordinate activity Commander/Director, and the servicing CPO/CPAC/

CPOC. The agreement will be reviewed by the Headquarters, MRMC legal

office for ethics determinations under the Joint Ethics Regulations.

The agreement must be finalized before the assumption of duties and

shall include:

(a) a statement that the voluntary assignment does not constitute

an appointment in the civil service and is without compensation, and

any and all claims against the Government because of the voluntary

assignment are waived by the volunteer;

(b) a statement that the volunteer will be considered a Federal

employee for the purpose of injury compensation;

(c) volunteer's work schedule;

(d) length of agreement (defined by length of project or time

defined by weeks, months, or years);

(e) support provided by the subordinate activity (travel,

administrative, office space, supplies);

(f) a one-page or less Statement of Duties and Experience;

(g) a provision that states no additional time will be added to a

volunteer's service credit for such purposes as retirement, severance

pay and leave as a result of being a member of the Voluntary Emeritus

Program;

(h) a provision allowing either party to void the agreement with 10

working days written notice; and

(i) the level of security access required (any security clearance

required by the position will be managed by the subordinate activity

while the volunteer is a member of the Voluntary Emeritus Program).

E. Expanded Developmental Opportunities Program

The MRMC Expanded Developmental Opportunities Program will cover

all demonstration project employees. An expanded developmental

opportunity complements existing developmental opportunities such as

(1) long-term training, (2) one-year work experiences in an industrial

setting via the Relations With Industry Program, (3) one-year work

experiences in laboratories of allied nations via the Science and

Engineer Exchange Program, (4) rotational job assignments within the

MRMC, (5) developmental assignments in higher headquarters within the

Army and DoD, (6) self-directed study via correspondence courses and

local colleges and universities, (7) details within MRMC and to other

Federal Agencies, and (8) Intergovernmental Personnel Act Agreements.

Each developmental opportunity period should benefit the MRMC, as

well as increase the employee's individual effectiveness. Various

learning or uncompensated developmental work experiences may be

considered, such as advanced academic teaching or research,

sabbaticals, or on-the-job work experience with public or non-profit

organizations.

An expanded developmental opportunity period will not result in

loss of (or reduction in) basic pay, leave to which the employee is

otherwise entitled, or credit for time or service. Input for

performance rating purposes will be obtained from the gaining

organization to ensure a rating of record is on file and, if warranted,

a performance award and/or bonus and retention years credit for RIF

purposes is documented.

The opportunity to participate in the Expanded Developmental

Opportunities Program will be announced as opportunities arise.

Instructions for application and the selection criteria will be

included in the announcement. Final selection/approval for

participation in the program will be made by activity Commanders/

Directors. The position of employees on an expanded developmental

opportunity may be backfilled by temporary promotion, or temporary/

contingent employees. However, that position or its equivalent must be

made available to the employee returning from the expanded

developmental opportunity.

An employee accepting an Expanded Developmental Opportunity must

sign a continuing service agreement. If the employee voluntarily leaves

the MRMC before the service obligation is completed, the employee is

liable for repayment. However, the MRMC Director has the authority to

waive this agreement.

F. Revised Reduction-in-Force (RIF) Procedures

Introduction

When an employee in the MRMC demonstration project is faced with

separation or downgrading due to lack of work, shortage of funds,

reorganization, insufficient personnel ceiling, the exercise of

reemployment or restoration rights, or furlough for more than 30

calendar days or more than 22 discontinuous days, RIF procedures will

be used.

The procedures in 5 CFR Part 351 will be followed with the

modifications specified below pertaining to competitive areas,

assignment rights, credit for performance ratings and service

computation date.

Competitive Areas

The Headquarters and each subordinate activity of the MRMC will be

in a separate competitive area for RIF purposes. Further, within each

subordinate activity, detachments located at different geographic sites

will be in a separate competitive area for RIF purposes. Each of the

four occupational families will be a separate competitive area within

each activity. (Competitive service and excepted service employees will

compete separately within a competitive area.) DA Interns will continue

to be part of the ACTEDS competitive area.

Retention

Within each competitive area, competitive levels will be

established consisting of all positions in the same occupational family

and pay band which are similar enough in duties, qualifications, and

working conditions that the incumbent of one position can perform

successfully the duties of any other position in the competitive level

without unduly interrupting the work program.

Current RIF regulations will be modified to restrict bumping and

retreating to positions within the employee's current occupational

family. This feature will minimize the disruption associated with the

RIF process. An employee may displace another employee within the same

occupational family by bump or retreat to one band below the employee's

existing band. A preference eligible veteran with a compensable

service-connected disability of 30% or more may retreat to positions

two bands (or the equivalent of five (5) grades) below his/her current

band.

Reductions-in-force are accomplished using the retention factors of

tenure, veterans preference, credit for performance ratings, and length

of service, in that order.

Contingent employees are in Tenure Group III for reduction-in-force

purposes. Reduction-in-force procedures are not required when

separating these employees when their appointments expire.

Link Between Performance and Retention

Credit for performance based on the last three (3) ratings of

record during the preceding four (4) years will be applied as follows:

a rating of ``A'' equals 10 years; a rating of ``B'' equals 7 years; a

[[Page 10453]]

rating of ``C'' equals 3 years, and a rating of ``F'' adds no credit

for retention. Credit for performance is cumulative, not averaged.

Ratings given under non-demonstration systems will be converted to the

demonstration rating scheme and provided the equivalent performance

rating credit.

In some cases, an employee may not have three (3) annual

performance ratings of record. In these situations, performance credit

will be given on the basis of either an average of the ratings actually

on record or if no actual ratings, modal rating (most common) given

within the employee's competitive area. When an employee is missing a

rating of record, the credit assigned for the actual ratings received

will be averaged, and the result thus derived will be used as the

credit for the missing rating. For an employee who has no ratings of

record, all credit will be based on the repeated use of a single modal

rating from the most recently completed appraisal period on record.

An employee who has received a written decision to demote him/her

to a lower pay band because of unacceptable performance, competes in

RIF from the position to which he/she will be/has been demoted.

Employees who have been demoted for unacceptable performance, and as of

the date of the issuance of the RIF notice have not received a

performance rating in the position to which demoted, will receive

either an average of the ratings actually on record or if no actual

ratings, modal rating (most common) given within the employee's

competitive area.

An employee with a current annual performance rating of ``F'' has

assignment rights only to a position held by another employee who has

an ``F'' rating. An employee who has been given a written decision of

removal because of unacceptable performance or conduct will be placed

at the bottom of the retention register for their competitive level.

Link Between Service Computation Date ( Length of Service) and

Retention

Service computation date (length of service) will be used in RIF

procedures when performance retention procedures result in two or more

employees with the same standing. When this occurs, all creditable

service (both civilian and military) will be used to determine which

employee(s) will be separated.

Notice Period

The RIF notice period will follow OPM guidelines.

Grade and Pay Retention

Except where waived or modified in the waiver section of this plan,

grade and pay retention will follow current law and regulations (e.g.

occupational family pay bands will substitute for grade.)

Use of Voluntary Incentives

Subordinate activity Commanders/Directors currently have delegated

authority to grant payments under the VSIP. This authority will

continue under this project.

IV. Training

Introduction

The key to the success or failure of the proposed demonstration

project will be the training provided for all involved. This training

will not only provide the necessary knowledge and skills to carry out

the proposed changes, but will also lead to commitment to the program

on the part of participants.

Training at the beginning of implementation and throughout the

demonstration will be provided to supervisors, employees, and the

administrative staff responsible for assisting managers in effecting

the changeover and operation of the new system.

The elements to be covered in the orientation portion of this

training will include at a minimum:

(1) A description of the personnel system, (2) how employees are

converted into and out of the system, (3) the pay adjustment and/or

bonus process, (4) familiarization with the new position descriptions

and performance objectives, (5) the performance evaluation management

system, (6) the reconsideration process, and (7) the demonstration

project administrative and formal evaluation process.

Supervisors

The focus of this project on management-centered personnel

administration, with increased supervisory and managerial personnel

management authority and accountability, demands thorough training of

supervisors and mangers in the knowledge and skills that will prepare

them for their new responsibilities. Training will include detailed

information on the policies and procedures of the demonstration

project, training in using the classification system, position

description preparation, and performance evaluation. Additional

training may focus on non-project procedural techniques such as

interpersonal and communication skills.

Administrative Staff

The administrative staff, including personnel specialists,

subordinate activity administrative officers, and personnel points of

contact will play a key role in advising, training, and coaching

supervisors and employees in implementing the demonstration project.

This staff will need training in the procedural and technical aspects

of the project.

Employees

The MRMC Demonstration Project Office will make and coordinate all

arrangements necessary to train employees covered under the

demonstration project. In the months leading up to the implementation

date, meetings will be held for employees to fully inform them of all

project decisions, procedures, and processes.

V. Conversion

Conversion to the Demonstration Project

a. Initial entry into the demonstration project will be

accomplished through a full employee protection approach that ensures

each employee an initial place in the appropriate pay band without loss

of pay. Employees serving under regular term appointments at the time

of the implementation of the demonstration project will be converted to

the contingent employee appointments so long as the original term

appointment was made under competitive procedures. An automatic

conversion from current GS/GM grade and pay into a new broadband system

will be accomplished. Each employee's initial total salary under the

demonstration project will equal the total salary received immediately

before conversion. If conversion into the demonstration project is

accomplished by a geographic move, the employee's GS pay entitlements

in the new geographic area must be determined before performing the pay

conversion.

b. Employees who are on temporary promotions at the time of

conversion will be converted to a pay band commensurate with the grade

of the position to which temporarily promoted. At the conclusion of the

temporary promotion, the employee will revert to the pay band which

corresponds to the grade of record. When a temporary promotion is

terminated, the employee's pay entitlements will be determined based on

the employee's position of record, with appropriate adjustments to

reflect pay events during the temporary promotion, subject to the

specific policies and rules established by the MRMC. In no case may

those

[[Page 10454]]

adjustments increase the pay for the position of record beyond the

applicable pay range maximum rate. The only exception will be if the

original competitive promotion announcement stipulated that the

promotion could be made permanent; in these cases, actions to make the

temporary promotion permanent will be considered, and if implemented,

will be subject to all existing priority placement programs.

c. Employees who are covered by special salary rates, prior to the

demonstration project, will no longer be considered a special rate

employee under the demonstration project. These employees will,

therefore, be eligible for full locality pay. The adjusted salaries of

these employees will not change. Rather, the employees will receive a

new basic pay rate computed by dividing their adjusted basic pay

(higher of special rate or locality rate) by the locality pay factor

for their area. A full locality adjustment will then be added to the

new basic pay rate. Adverse action and pay retention provisions will

not apply to the conversion process as there will be no change in total

salary.

d. During the first 12 months following conversion, employees will

receive pay increases for non-competitive promotion equivalents when

the grade level of the promotion is encompassed within the same

broadband, the employee's performance warrants the promotion and

promotions would have otherwise occurred during that period. Employees

who receive an in-level promotion at the time of conversion will not

receive a prorated step increase equivalent as defined below.

e. Under the current pay structure, employees progress through

their assigned grade in step increments. Since this system is being

replaced under the demonstration project, employees will be awarded

that portion of the next higher step based upon the portion of the

waiting period they have completed prior to the date of implementation.

Payment will be lump sum in nature (not added to base pay) and will be

paid at the one-year anniversary of the date of implementation of the

demonstration project. Those employees added to the MRMC by actions

such as transfer of function, BRAC, etc., after initial implementation,

will be awarded that portion of the next higher step based upon the

portion of the waiting period they have completed at the time they

convert into the demonstration project. This lump sum payment will be

made upon conversion but no earlier than one year after the

implementation of the project. Rules governing within-grade increases

under the current Army performance plan will continue in effect until

the implementation date. Employees at step 10, or receiving retained

rates, on the date of implementation will not be eligible for a

prorated lump sum buyout of the WGI since they are already at or above

the top of the step scale.

Conversion or Movement From a Project Position to a General Schedule

Position

If a demonstration project employee is moving to a General Schedule

(GS) position not under the demonstration project, or if the project

ends and each project employee must be converted back to the GS system,

the following procedures will be used to convert the employee's project

pay band to a GS-equivalent grade and the employee's project rates of

pay to GS-equivalent rates of pay. The converted GS grade and GS rates

of pay must be determined before movement or conversion out of the

demonstration project and any accompanying geographic movement,

promotion, or other simultaneous action. For conversions upon

termination of the project and for lateral reassignments, the converted

GS grade and rate will become the employee's actual GS grade and rate

after leaving the demonstration project (before any other action). For

transfers, promotions, and other actions, the converted GS grade and

rate will be used in applying any GS pay administration rules

applicable in connection with the employee's movement out of the

project (e.g., promotion rules, highest previous rate rules, pay

retention rules), as if the GS converted grade and rate were actually

in effect immediately before the employee left the demonstration

project.

Grade-Setting Provisions

An employee in a pay band corresponding to a single GS grade is

converted to that grade. An employee in a pay band corresponding to two

or more grades is converted to one of those grades according to the

following rules:

(a) The employee's adjusted rate of basic pay under the

demonstration project (including any locality payment) is compared with

step 4 rate in the highest applicable GS rate range. (For this purpose,

a ``GS rate range'' includes a rate range in (1) the GS base schedule,

(2) the locality rate schedule for the locality pay area in which the

position is located, or (3) the appropriate special rate schedule for

the employee's occupational series, as applicable.) If the series is a

two-grade interval series, only odd-numbered grades are considered

below GS-11.

(b) If the employee's adjusted project rate equals or exceeds the

applicable step 4 rate of the highest GS grade in the band, the

employee is converted to that grade.

(c) If the employee's adjusted project rate is lower than the

applicable step 4 rate of the highest grade, the adjusted rate is

compared with the step 4 rate of the second highest grade in the

employee's pay band. If the employee's adjusted rate equals or exceeds

step 4 rate of the second highest grade, the employee is converted to

that grade.

(d) This process is repeated for each successively lower grade in

the band until a grade is found in which the employee's adjusted

project rate equals or exceeds the applicable step 4 rate of the grade.

The employee is then converted at that grade. If the employee's

adjusted rate is below the step 4 rate of the lowest grade in the band,

the employee is converted to the lowest grade.

(e) Exception: If the employee's adjusted project rate exceeds the

maximum rate of the grade assigned under the above-described ``step 4''

rule, but fits in the rate range for the next higher applicable grade

(i.e., between step 1 and step 4), then the employee shall be converted

to that next higher applicable grade.

(f) Exception: An employee will not be converted to a lower grade

than the grade held by the employee immediately preceding a conversion,

lateral reassignment, or lateral transfer into the project, unless

since that time, the employee has undergone a reduction in band.

Pay-Setting Provisions

An employee's pay within the converted GS grade is set by

converting the employee's demonstration project rate of pay to GS rate

of pay in accordance with the following rules:

(a) The pay conversion is done before any geographic movement or

other pay-related action that coincides with the employee's movement or

conversion out of the demonstration project.

(b) An employee's adjusted rate of basic pay under the project

(including any locality payment) is converted to a GS adjusted rate on

the highest applicable GS rate range for the converted GS grade. (For

this purpose, a ``GS rate range'' includes a rate range in (1) the GS

base schedule, (2) an applicable locality rate schedule, or (3) an

applicable special rate schedule.)

(c) If the highest applicable GS rate range is a locality pay rate

range, the employee's adjusted project rate is converted to a GS

locality rate of pay. If this rate falls between two steps in the

locality-adjusted schedule, the rate must be set at the higher step.

The converted

[[Page 10455]]

GS unadjusted rate of basic pay would be the GS base rate corresponding

to the converted GS locality rate (i.e., same step position). (If this

employee is also covered by a special rate schedule as a GS employee,

the converted special rate will be determined based on the GS step

position. This underlying special rate will be basic pay for certain

purposes for which the employee's higher locality rate is not basic

pay.)

(d) If the highest applicable GS rate range is a special rate

range, the employee's adjusted project rate is converted to a special

rate. If this rate falls between two steps in the special rate

schedule, the rate must be set at the higher step. The converted GS

unadjusted rate of basic pay will be the GS rate corresponding to the

converted special rate (i.e., same step position).

E&S Pay Band V Employees

An employee in Pay Band V of the E&S Occupational Family will

convert out of the demonstration project at the GS-15 level. The MRMC,

in consultation with the CPOs/CPACs/CPOCs, will develop a procedure to

ensure that employees entering Pay Band V understand that if they leave

the demonstration project and their adjusted pay exceeds the GS-15,

step 10 rate, there is no entitlement to retained pay; their GS-

equivalent rate will be deemed to be the rate for GS-15, step 10. For

those Pay Band V employees paid below the adjusted GS-15, step 10 rate,

the converted rates will be set in accordance with Pay-Setting

Provisions above.

Employees With Band or Pay Retention

If an employee is retaining a band level under the demonstration

project, apply the procedures in the Grade-Setting and Pay-Setting

Provisions above, using the grades encompassed in the employee's

retained band to determine the employee's GS-equivalent retained grade

and pay rate. The time in a retained band under the demonstration

project counts toward the 2-year limit on grade retention in 5 U.S.C.

5382.

If an employee is receiving a retained rate under the demonstration

project, the employee's GS-equivalent grade is the highest grade

encompassed in his or her band level. MRMC will coordinate with OPM to

prescribe a procedure for determining the GS-equivalent pay rate for an

employee retaining a rate under the demonstration project.

Within-Grade Increase--Equivalent Increase Determinations

Service under the demonstration project is creditable for within-

grade increase purposes upon conversion back to the GS pay system.

Performance pay increases (including a zero increase) under the

demonstration project are equivalent increases for the purpose of

determining the commencement of a within-grade increase waiting period

under 5 CFR 531.405(b).

Personnel Administration

All personnel laws, regulations, and guidelines not waived by this

plan will remain in effect. Basic employee rights will be safeguarded

and merit principles will be maintained. Supporting personnel

specialists in CPOs/CPACs/CPOCs will continue to process personnel-

related actions and provide consultative and other appropriate

services.

Automation

The MRMC will continue to use the Defense Civilian Personnel Data

System (DCPDS) for the processing of personnel-related data. Payroll

servicing will continue from the respective payroll offices.

Local automated systems will be developed to support computation of

performance-related pay increases and awards and other personnel

processes and systems associated with this project.

Experimentation and Revision

Many aspects of a demonstration project are experimental.

Modifications may be made from time to time as experience is gained,

results are analyzed, and conclusions are reached on how the system is

working. The MRMC will make minor modifications, such as changes in the

occupational series in an occupational family without further notice.

Major changes, such as a change in the number of occupational families,

will be published in the Federal Register.

VI. Project Duration

Public Law 103-337 removed any mandatory expiration date for this

demonstration. The project evaluation plan adequately addresses how

each intervention will be comprehensively evaluated for at least the

first 5 years of the demonstration (Proposed Plan for Evaluation of the

DoD Laboratory Demonstration Program, OPM, 1995). Major changes and

modifications to the interventions can be made through announcement in

the Federal Register and would be made if formative evaluation data

warranted. At the 5-year point, the entire demonstration will be

reexamined for either: (a) Permanent implementation, (b) a continuing

test period, or (c) expiration.

VII. Evaluation Plan

Introduction

In response to the Reinvention Project legislation, OPM will

evaluate the project annually and provide briefings and written reports

of the findings. The Evaluation Plan stipulates both internal and

external evaluation efforts. The phases of the plan are outlined below.

Evaluation Phases

The evaluation effort will be carried out in three phases:

implementation, formative, and summative evaluation. Monitoring of the

project will be concurrent with the implementation phase. An evaluation

of this phase is necessary to determine whether the project is

implemented as designed and to ascertain when the monitored processes

become stable and fully operational. The formative phase evaluation

will extend for the duration of the project. Data will be collected

annually and periodic reports will be issued by OPM. The summative

evaluation phase will assess overall impact of the project during

appropriate time intervals and/or after 5 years of operation.

Evaluation Methodology

The evaluation will focus on the continuum of personnel issues and

will be based on before-and-after comparison of the personnel data,

using both quantitative and qualitative criteria. Personnel records and

reports, as well as previously validated survey instruments, will be

used to develop appropriate measures. New data collection methods and

measures, or modifications to existing instruments, may be required for

some criteria. Baseline data will be collected before the demonstration

project implementation. The baseline survey was administered in the

Summer of 1996.

Evaluation Criteria

While it is not possible to prove a direct causal link between

intermediate and ultimate outcomes (personnel system changes and

improved organizational performance), indirect cause and effect

relationships can be evidenced through the establishment of relevant

effectiveness measures. An intervention impact model (Appendix B) will

be used to measure the effectiveness of the various personnel system

changes or interventions. Additional measures will be developed as new

interventions are introduced or existing interventions modified

consistent with expected effects. Measures may also be deleted when

[[Page 10456]]

appropriate. Activity specific measures may also be developed to

accommodate specific needs or interests which are locally unique. The

evaluation model for the demonstration project identifies elements

critical to an evaluation of the effectiveness of the interventions.

The overall evaluation approach will also include consideration of

context variables that are likely to have an impact on project

outcomes: e.g., HRM regionalization, rightsizing, cross-service

integration, and the general state of the economy. However, the main

focus of the evaluation will be on intermediate outcomes, i.e., the

results of specific personnel system changes which are expected to

improve human resources management. The ultimate outcomes are defined

as improved organizational effectiveness, mission accomplishment and

customer satisfaction.

Data from a variety of different sources will be used in the

evaluation. Information from existing management information systems

supplemented with perceptual data will be used to assess variables

related to effectiveness. Multiple methods provide more than one

perspective on how the demonstration project is working. Information

gathered through one method will be used to validate information

gathered through another. Confidence in the findings will increase as

they are substantiated by the different collection methods. The

following types of data will be collected as part of the evaluation:

(1) Workforce data; (2) personnel office data; (3) employee attitudes

and feedback using surveys, structured interviews and focus groups; (4)

local activity histories; and (5) core measures of subordinate activity

performance.

VIII. Demonstration Project Costs

Costs associated with the development of the personnel

demonstration system include software automation, training, and project

evaluation. All funding will be provided through the MEDCOM/MRMC

budget. The projected annual expenses are as summarized in Table 1.

Project evaluation costs are not expected to continue beyond the first

5 years unless the results warrant further evaluation. Projected

developmental costs do not include potential contractor fees.

Table 1.--Projected Developmental Costs (Current Year Dollars)

[Thousands]

----------------------------------------------------------------------------------------------------------------

Baseline FY97 FY98 FY99 FY00 FY01

----------------------------------------------------------------------------------------------------------------

Training.......................... ........... $99 $19 $19 $19 $19

Project Eval...................... $17 28 60 60 60 60

Automation........................ 80 10 10 10 10 10

-----------------------------------------------------------------------------

Totals........................ 97 137 89 89 89 89

----------------------------------------------------------------------------------------------------------------

IX. Required Waivers to Law and Regulation

Public Law 103-337 gave the DoD the authority to experiment with

several personnel management innovations. In addition to the

authorities granted by the law, the following are the waivers of law

and regulation that will be necessary for implementation of the

demonstration project. In due course, additional laws and regulations

may be identified for waiver request.

1. Waivers to Title 5, U.S. Code

Chapter 31, Section 3111: Acceptance of volunteer service--To the

extent that the acceptance of retired or separated civilian and

military are included as volunteers under current statute in addition

to student volunteers.

Chapter 31, Section 3132: The Senior Executive Service, Definitions

and Exclusions.

Chapter 33, Section 3324: Appointments to Positions Classified

Above GS-15.

Chapter 33, Section 3341: Details; within Executive or military

departments--Increasing 120-Day Increments for Details to 180 days.

Chapter 35, Section 3502: Order of Retention--Applies only to the

extent that performance score is placed before length of service.

Chapter 43, Sections 4302 and 4303: To the extent necessary to (1)

substitute ``pay band'' for ``grade'' and (2) provide that moving to a

lower pay band as a result of not receiving the full amount of a

general pay increase because of poor performance is not an action

covered by the provisions of section 4303.

Chapter 51, Sections 5101-5111: Purpose, definitions, basis,

classification of positions, review, authority--Applies to the extent

that white collar employees will be covered by broadbanding. Pay

category determination criteria for federal wage system positions

remain unchanged.

Chapter 53, Sections 5301, 5302 (8) and (9), 5303 and 5304: Pay

Comparability System--Sections 5301, 5302, and 5304 are waived only to

the extent necessary to allow (1) demonstration project employees to be

treated as General Schedule employees, (2) basic rates of pay under the

demonstration project to be treated as scheduled rates of pay , and (3)

employees in Pay Band V of the Engineers and Scientists Occupational

Family to be treated as ST employees for the purposes of these

provisions.

Chapter 53, Section 5305: Special Salary rates.

Chapter 53, Sections 5331-5336: General Schedule Pay Rates.

Chapter 53, Sections 5361-5366: Grade and pay retention--This

waiver applies only to the extent necessary to (1) replace ``grade''

with ``pay band''; (2) allow demonstration project employees to be

treated as General Schedule employees; (3) provide that pay band

retention provisions do not apply to movements to a lower pay band as a

result of not receiving the general increase due to an annual

performance rating of ``F''; (4) provide that pay retention provisions

do not apply to conversions from General Schedule special rates to

demonstration project pay, as long as total pay is not reduced; (5)

provide that an employee receiving a retained rate whose performance

rating is ``F'' at the time of a general pay increase will receive no

increase in the retained rate; (6) ensure that, for employees in Pay

Band V of the E&S Occupational Family, pay band retention is not

applicable and pay retention provisions are modified so that no rate

established under these provisions may exceed the rate of basic pay for

GS-15, step 10 (i.e., there is no entitlement to a retained rate).

Chapter 53, Section 5371: Health Care Positions--This waiver

applies only to the extent necessary to allow demonstration project

employees to be treated as if they hold positions subject to Chapter 51

of title 5.

[[Page 10457]]

Chapter 55, Section 5545(d): Hazardous Duty Differential--This

waiver applies only to the extent necessary to allow demonstration

project employees to be treated as General Schedule employees. This

waiver does not apply to employees in Pay Band V of the Engineers and

Scientists Occupational Family.

Chapter 57, Sections 5753, 5754, and 5755: Recruitment and

Relocation Bonuses; Retention Allowances and Supervisory

Differentials--This waiver applies only to the extent necessary to

allow (1) employees and positions under the demonstration project to be

treated as employees and positions under the General Schedule and (2)

employees in Pay Band V of the Engineers and Scientists Occupational

Family to be treated as ST employees.

Chapter 59, Section 5941: Allowances based on living costs and

conditions of environment; employees stationed outside continental U.S.

or Alaska. This waiver applies only to the extent necessary to provide

that COLA's paid to employees under the demonstration project are paid

in accordance with regulations prescribed by the President (as

delegated to OPM).

Chapter 59, Section 5948(1): Physicians Comparability Allowances--

This waiver applies only to the extent necessary to allow (1) physicans

under the demonstration project to be treated as employees paid under

the General Schedule and (2) physicians in Pay Band V of the Engineers

and Scientists Occupational Family who are performing research and

technology assignments to be treated as ST positions.

Chapter 75, Section 7512(3): Adverse actions--This provision is

waived only to the extent necessary to (1) replace ``grade'' with ``pay

band'' and (2) provide that a reduction in band level is not an adverse

action if it results from the employee's rate of basic pay being

exceeded by the minimum rate of basic pay for his or her pay band.

Chapter 75, Section 7512(4): Adverse actions--This provision is

waived only to the extent that adverse action provisions do not apply

to conversions from General Schedule special rates to demonstration

project pay, as long as total pay is not reduced.

2. Title 5, Code of Federal Regulations

Part 300.601-605: Time-In-Grade Restrictions--Restrictions

eliminated under the demonstration.

Part 308.101-103: Volunteer Service--To the extent that retired/

separated civilians and military can perform voluntary services in

addition to student volunteers.

Part 315.801 and 315.802: Probation on Initial Appointment to a

Competitive Position--Demonstration project employees in some

occupational families will have extended probationary period.

Part 316.301: Term Employment--Adding years to exceed 4 and

establishment of Contingent appointments.

Part 316.303: Tenure of term employees--Demonstration allows for

conversion to career/career-conditional appointments.

Part 316.305: Eligibility for within-grade increases--Demonstration

employees no longer receive WGIs.

Part 334, Section 334.102: Temporary Assignment of Employees

Outside the Agency.

Part 335.103: Covering the length of details and temporary

promotions.

Part 351.402(b): Competitive Area--To the extent that occupational

family is the competitive area.

Part 351.403: Competitive Level--To the extent that pay band is

substituted for grade.

Part 351.504: Credit for Performance--Retention standing to the

extent that service credit will not be modified based on performance

rating.

Part 351.701: Assignment Involving Displacement--To the extent that

bumping and retreating will be limited to no more than one pay band

except for 30 percent compensable veterans who can retreat to the

equivalent of 5 GS grades.

Part 430.201 thru 210: Subpart B, Performance Appraisal for General

Schedule, Prevailing Rate, and Certain Other Employees--Employees under

the demonstration project will not be subject to the requirements of

this subpart.

Part 432: Performance Based Reduction In Grade and Removal

Actions--Modified to the extent that an employee may be removed,

reduced in band level with a reduction in pay, and reduced in pay

without a reduction in band level based on unacceptable performance.

For employees who are reduced in band level without a reduction in pay

as a result of non-receipt of a general increase, Sections 432.105 and

432.106 (a) and (c) do not apply.

Part 432, Sections 104 and 105: Addressing unacceptable performance

and proposing and taking action based on unacceptable performance--In

so far as references to ``critical elements'' are deleted (all elements

are critical), and adding that the employee may be ``reduced in band

level, or pay, or removed'' if performance does not improve to

acceptable levels after a reasonable opportunity.

Part 511: Classification Under the General Schedule--To the extent

that grades are changed to broadbands, and that white collar positions

are covered by broadbanding.

Part 530, subpart C: Special Salary Rate Schedules for Recruitment

and Retention.

Part 531, subparts B, D, and E: Pay Under the General Schedule--

Determining rate of basic pay, within-grade increases, and quality step

increases.

Part 531, subpart F: Locality Based Comparability Payments--This

waiver applies only to the extent necessary to allow (1) Demonstration

project employees to be treated as General Schedule employees, (2)

basic rates of pay under the demonstration project to be treated as

scheduled annual rates of pay, and (3) employees in Pay Band V of the

Engineers and Scientists Occupational Family to be treated as ST

employees for the purposes of these provisions.

Part 536: Grade and pay retention--This waiver applies only to the

extent necessary to (1) Replace ``grade'' with ``pay band'; (2) allow

demonstration project employees to be treated as General Schedule

employees; (3) provide that pay band retention provisions do not apply

to movements to a lower pay band as a result of not receiving the

general increase due to an annual performance rating of ``F'; (4)

provide that pay retention provisions do not apply to conversions from

General Schedule special rates to demonstration project pay, as long as

total pay is not reduced; (5) provide that an employee receiving a

retained rate whose performance rating is ``F'' at the time of a

general pay increase will receive no increase in the retained rate; (6)

ensure that, for employees in Pay Band V of the E&S Occupational

Family, pay band retention is not applicable and pay retention

provisions are modified so that no rate established under these

provisions may exceed the rate of basic pay for GS-15, step 10 (i.e.,

there is no entitlement to a retained rate).

Part 550.703: Severance Pay--This waiver applies only to the extent

necessary to modify the definition of ``reasonable offer'' by replacing

``two grade or pay levels'' with ``one band level'' and ``grade or pay

level'' with ``band level.''

Part 550.902: Hazardous Duty Differential--This waiver applies only

to the extent necessary to allow demonstration project employees to be

treated as General Schedule employees. This waiver does not apply to

[[Page 10458]]

employees in Pay Band V of the Engineers and Scientists Occupational

Family.

Part 575, subparts A, B, C and D: Recruitment and Relocation

Bonuses; Retention Allowances; Supervisory Differentials--This waiver

applies only to the extent necessary to allow (1) Employees and

positions under the demonstration project to be treated as employees

and positions under the General Schedule and (2) employees in Pay Band

V of the Engineers and Scientists Occupational Family to be treated as

ST employees for the purposes of these provisions.

Part 591, subpart B: Cost-of-Living Allowances and Post

Differential-Non-foreign Areas--This waiver applies to the extent

necessary to allow (1) Demonstration project employees to be treated as

employees under the General Schedule and (2) employees in Pay Band V of

the Engineers and Scientists Occupational Family to be treated as ST

employees for the purposes of these provisions.

Part 752.401(a)(3): Adverse Actions--This waiver applies only to

the extent necessary to (1) replace ``grade'' with ``pay band'' and (2)

provide that a reduction in pay band level is not an adverse action if

it results from the employee's rate of basic pay being exceeded by the

minimum rate of basic pay for his or her pay band.

Part 752.401(a)(4): Adverse Actions--This waiver applies only to

the extent that adverse action provisions do not apply to conversions

from General Schedule special rates to demonstration project pay, as

long as total pay is not reduced.

Appendix A: Occupational Series by Occupational Family

I. Engineers and Scientists

0101 Social Science

0180 Psychology

0190 Anthropology

0401 Biology

0403 Microbiology

0405 Pharmacology

0408 Ecology

0410 Zoology

0413 Physiology

0414 Entomology

0415 Toxicology

0440 Genetics

0601 General Health Science

0602 Medical Officer

0610 Nurse

0630 Dietitian & Nutritionist

0644 Medical Technologist

0662 Optometrist

0701 Veterinary Medical Science

0801 General Engineering

0808 Architecture

0830 Mechanical Engineering

0855 Electronics Engineering

0858 Biomedical Engineering

1301 General Physical Science

1306 Health Physics

1310 Physics

1320 Chemistry

1520 Mathematics

1529 Mathematical Stat

1530 Statistician

II. E&S Technicians

0181 Psychology Aid/Technician

0404 Biological Science Technician

0499 Biological Science Student Trainee

0620 Practical Nurse

0640 Health Aid & Technician

0645 Medical Technician

0646 Pathology Technician

0647 Diagnostic Radiologic Technologist

0649 Medical Instrument Technician

0802 Engineer Technician

0809 Construction Control

0818 Engineering Drafting

0856 Electronics Technician

1311 Physical Sciences Technician

1521 Mathematics Technician

III. Administrative

0018 Safety & Occupational Health Management

0028 Environmental Protection Spec

0080 Security Administration

0201 Civilian Personnel Management

0205 Military Personnel Management

0301 Misc Administration & Program

0332 Computer Operation

0334 Computer Specialist

0340 Program Management

0341 Administrative Officer

0342 Support Services Administration

0343 Management/Program Analysis

0346 Logistics Management

0391 Telecommunications

0501 Financial Administration & Program

0505 Financial Management

0510 Accounting

0511 Auditing

0560 Budget Analysis

0905 General Attorney

1020 Illustrating

1035 Public Affairs

1040 Language Specialist

1060 Photography

1071 Audiovisual Production

1082 Writing & Editing

1083 Technical Writing & Editing

1084 Visual Information

1102 Contracting

1105 Purchasing

1152 Production Control

1222 Patent Attorney

1410 Librarian

1412 Technical Information Services

1601 General Facilities & Equipment

1640 Facility Management

1670 Equipment Specialist

1710 Educational & Vocational Training

1740 Education Services

1801 General Inspection, Investigation and Compliance

1910 Quality Assurance

2001 General Supply

2003 Supply Program Management

2010 Inventory Management

2050 Supply Cataloging

2181 Aircraft Operation

IV. General Support

0086 Security Clerical & Asst

0204 Military Personnel Technician

0302 Messenger

0303 Misc Clerk and Asst

0304 Information Receptionist

0305 Mail and File

0312 Clerk-Stenographer/Reporter

0318 Secretary

0322 Clerk-Typist

0326 Office Automation Clerical/Asst

0335 Computer Clerk/Asst

0344 Management Clerical/Asst

0525 Accounting Technician

0561 Budget Clerical/Asst

0675 Medical Records Technician

0679 Medical Clerk

1016 Museum Specialist & Technician

1087 Editorial Asst

1106 Procurement Clerical/Tech

1411 Library Technician

1499 Library and Archives Student Trainee

1531 Statistical Asst

2005 Supply Clerical/Tech

2102 Transportation Clerk/Asst

Appendix B: Project Evaluation and Oversight--Intervention Impact Model--DoD Lab Demonstration Program

----------------------------------------------------------------------------------------------------------------

Intervention Expected effects Measures Data source

----------------------------------------------------------------------------------------------------------------

1. Compensation

----------------------------------------------------------------------------------------------------------------

a. Broad banding................. --Increased --Perceived flexibility. --Attitude survey

organizational

flexibility.

--Reduced administrative --Actual/perceived time --Personnel office data,

workload, paperwork savings. PME results, attitude

reduction. survey

--Advanced in-hire rates. --Starting salaries of --Workforce data

banded v. non-banded

employees.

--Slower pay progression --Progression of new --Workforce data

at entry levels. hires over time by

band, career path.

[[Page 10459]]

--increased pay potential --mean salaries by band, --Workforce data

career path, --Personnel office data

demographics.

--total payroll cost....

--increased satisfaction --employee perceptions --Attitude survey

with advancement. of advancement.

--Increased pay --Pay satisfaction, --Attitude survey

satisfaction. internal/external

equity.

--Improved recruitment... --Offer/acceptance --Personnel office data

ratios.

--Percent declinations..

--No change in high grade --Number/percentage of --Workforce data

(GS-14/15) distribution. high grade salaries pre/

post banding.

b. Conversion buy-in............. --Employee acceptance.... --Employee perceptions --Workforce data

of equity, fairness.

--Cost as a percent of

payroll.

----------------------------------------------------------------------------------------------------------------

2. Performance Management

----------------------------------------------------------------------------------------------------------------

a. Cash awards/bonuses........... --Reward/motivate --Perceived motivational --Attitude survey

performance. power.

--To support fair and --Amount and number of --Workforce data

appropriate distribution awards by career path, --Attitude survey

of awards. demographics,. --Attitude survey

--Perceived fairness of

awards.

--Satisfacttion with

monetary awards.

b. Performance/contribution based --Increased pay- --Perceived pay --Attitude survey

pay progression. performance link. performance link. --Attitude survey

--Perceived fairness of

ratings.

--Improved performance --Satisfaction with --Attitude survey

feedback. ratings. --Attitude survey

--Employee trust in --Attitude survey

supervisors.

--Adequacy of

performance feedback.

--Decreased turnover of --Turnover by --Workforce data

high performers/ performance rating

increased turnover of category.

low performers.

--Differential pay --Pay progression by --Workforce data

progression of high/low performance rating

performers. category, career path.

--Alignment of --Linkage of performance --Performance

organizational and expectations to expectations, strategic

individual performance strategic plans/goals. plans

expectations and results.

......................... --performance --Attitude survey/focus

expectations,. groups

--Increased employee --Perceived involvement. --Attitude survey/focus

involvement in groups

performance planning and

assessment.

......................... --Performance management --Personnel regulations

procedures.

c. New appraisal process......... --Reduced administrative --Employee and --Attitude survey

burden. supervisor perception

of revised procedures.

--Improved communication. --Perceived fairness of --Focus group

process.

d. Performance development....... --Better communication of --Feedback and coaching --Focus group

performance expectations. procedures used. --Personnel office data

--Time, funds spent on --Training records

training by

demographics.

--Organizational

commitment.

--Improved satisfaction --Perceived workforce --Attitude survey

and quality of workforce. quality-attitude survey. Attitude survey

----------------------------------------------------------------------------------------------------------------

3. Classification

----------------------------------------------------------------------------------------------------------------

a. Improved classification --Reduction in amount of --Time spent on --Personnel office data

systems with generic standards. time and paperwork spent classification --Personnel office data

on classification. procedures.

--Reduction of paperwork/

number of personnel

actions (classification/

promotion).

--Ease of use............ --Managers' perceptions --Attitude survey

of time savings, ease

of use, improved

ability to recruit.

--Improved recruitment of --Quality of recruits... --Attitude survey

employees with --Perceived quality of --Focus groups/

appropriate skills. recruits. interviews

--GPAs of new hires, --Personnel office data

educational levels.

b. Classification authority --Increased supervisory --Perceived authority... --Attitude survey

delegated to managers. authority/accountability.

[[Page 10460]]

--Decreased conflict --Number of --Personnel records

between management and classification disputes/

personnel staff. appeals pre/post.

--Management

satisfaction with

service provided by

personnel office.

--Attitude survey.......

--No negative impact on --Internal pay equity... --Attitude survey

internal pay equity.

c. Dual career ladder............ --Increased flexibility --Assignment flexibility --Focus groups, survey

to assign employees.

--Improved internal --Supervisory/non- --Workforce data

mobility. supervisory ratios. --Attitude survey

--Perceived internal

mobility.

--Increased pay equity... --Perceived pay equity.. --Attitude survey

--Flatter organization... --Supervisory/non- --Workforce data

supervisory ratios.

--Improved quality of --Employe perceptions of --Attitude survey

supervisory staff. quality of supervisors.

----------------------------------------------------------------------------------------------------------------

4. RIF

----------------------------------------------------------------------------------------------------------------

Modified RIF..................... --Prevent loss of high --Separated employees by --Workforce data

performing employees demographics, --Attitude survey/focus

with need skills. performance. groups

--Contain cost and --Satisfaction with RIF --Attitude survey/focus

disruption. process. groups

--Cost comparisons of --Personnel office/

traditional v. modified budget data

RIF. --Personnel office data

--Time to conduct RIF... --Personnel office data

--Number of appeals/

reinstatements.

----------------------------------------------------------------------------------------------------------------

5. Combination of all Interventions

----------------------------------------------------------------------------------------------------------------

All.............................. --Improved organizational --Combination of --All data sources

effectiveness. personnel measures.

--Improved management of --Employee/management --Attitude survey

R&D workforce. job satisfaction

(intrinsic/extrinsic).

--Improved planning...... --Planning procedures... --Strategic planning

--Perceived documents

effectiveness of --Organizational charts

planning procedures.

--Improved cross --Actual/perceived --Attitude survey

functional coordination. coordination.

--Increased product --Customer satisfaction. --Customer satisfaction

success. surveys

--Cost of innovation..... --Project training/ --Demo project records

development cost (staff --Contract documents

salaries, contract

cost, training hours

per employee).

----------------------------------------------------------------------------------------------------------------

6. Context

----------------------------------------------------------------------------------------------------------------

a. Regionalization............... --reduced servicing --HR servicing ratios... --personnel office data,

ratios/cost. workforce data

--Average cost per --Workforce data/

employee served. personnel office data

--No negative impact on --Service quality, --Attitude survey/focus

service quality. timeliness. groups

b. GPRA.......................... --Improved organizational --Other measures to be --As established

performance. developed.

----------------------------------------------------------------------------------------------------------------

Appendix C. Performance Elements

Each performance element is assigned a weight between a

specified range. The total weight of all elements in a performance

plan is 100 points. The supervisor assigns each element some portion

of the 100 points in accordance with its importance for mission

attainment.

All employees will be rated against at least the five generic

performance elements listed through ``e'' below. However, only those

employees whose duties require supervisor or manager/leader

responsibilities will be rated on element ``f''. Supervisors will be

rated against an additional performance element, listed at ``g''

below:

a. Technical Competence. Exhibits and maintains current

technical knowledge, skills, and abilities to produce timely and

quality work with the appropriate level of supervision. Makes

prompt, technically sound decisions and recommendations that add

value to mission priorities and needs. For appropriate career paths,

seeks and accepts developmental and /or special assignments.

Adaptive to technological change. (Weight Range: 15 to 50)

[[Page 10461]]

b. Working Relationships. Accepts personal responsibility for

assigned tasks. Considerate of others views and open to compromise

on areas of difference, if allowed by technology, scope, budget, or

direction. Exercises tact and diplomacy and maintains effective

relationships, particularly in immediate work environment and

teaming situations. Always willing to give assistance. Shows

appropriate respect and courtesy. (Weight Range: 5 to 15)

c. Communications. Provides or exchanges oral/written ideas and

information in a manner that is timely, accurate and cogent. Listens

effectively so that resultant actions show understanding of what was

said. Coordinates so that all relevant individuals and functions are

included in, and informed of, decisions and actions. (Weight Range:

5 to 15)

d. Resource Management. Meets schedules and deadlines, and

accomplishes work in order of priority; generates and accepts new

ideas and methods for increasing work efficiency; effectively

utilizes and properly controls available resources; support

organization's resource development and conservation goals. (Weight

Range: 15 to 50)

e. Customer Relations. Demonstrates care for customers through

respectful, courteous, reliable and conscientious actions. Seeks out

and develops solid working relationships with customers to identify

their needs, quantifies those needs, and develops practical

solutions. Keeps customers informed and prevents surprises. Within

the scope of job responsibility, seeks out and develops new programs

and /or reimbursable customer work. (Weight Range: 10 to 50)

f. Management/Leadership. Actively furthers the mission of the

organization. As appropriate, participates in the development and

implementation of strategic and operational plans of the

organization. Develops and implements tactical plans. Exercises

leadership skill within the environment. Mentors junior personnel in

career development, technical competence, and interpersonal skills.

Exercises due responsibility to oversee technical/acquisition/

organizational positions assigned to them. (Weight Range: 0 to 50)

g. Supervision/EEO. Works toward recruiting, developing,

motivating, and retaining quality team members; takes timely/

appropriate personnel actions, applies EEO/merit principles;

communicates mission and organizational goals; by example, creates a

positive, safe, and challenging work environment; distributes work

and empowers team members. (Weight Range: 15 to 50)

BILLING CODE 6325-01-P

[[Page 10462]]

[GRAPHIC] [TIFF OMITTED] TN03MR98.001

[FR Doc. 98-5424 Filed 3-2-98; 8:45 am]

BILLING CODE 6325-01-C