Science and Technology Laboratory Personnel Management Demonstration Project; Department of the Army, U.S. Army Engineer Waterways Experiment Station (WES), Vicksburg, MS; Correction and Republication

SUMMARY: 5 U.S.C. 4703 authorizes the Office of Personnel Management

(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.

Public Law 103-337, October 5, 1994, permits the Department of

Defense (DoD), with the approval of the OPM, to carry out personnel

demonstration projects generally similar to the China Lake

demonstration project at DoD Science and Technology (S&T) Reinvention

Laboratories. The Army will implement demonstration projects initially

to cover five of its S&T Reinvention Laboratories: The Army Research

Laboratory; the Army Missile Research, Development, and Engineering

Center; the Army Aviation Research and Development Center; the Army

Medical Research and Materiel Command; and the Army Engineer Waterways

Experiment Station. This plan is for the Army Engineer Waterways

Experiment Station (WES).

DATES: This demonstration project may be implemented at WES beginning

on June 3, 1998.

FOR FURTHER INFORMATION CONTACT: WES: Dr. C.H. Pennington, U.S. Army

Engineer Waterways Experiment Station, ATTN: CEWES-ZT-E, 3909 Halls

Ferry Road, Vicksburg, Mississippi 39180-6199, phone 601-634-3549. 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. Background

Since 1966, at least 19 studies of DoD laboratories have been

conducted on laboratory quality and personnel. Almost all of these

studies have recommended improvements in civilian personnel policy,

organization, and management. The WES Personnel Management

Demonstration Project involves simplified job classifications, pay

banding, a performance-based compensation system, streamlined hiring

processes, and modified Reduction-in-Force (RIF) procedures.

2. Overview

On March 15, 1997, [62 FR 12006] OPM published this proposed

demonstration plan and received thirty-nine letters and eight

individuals commented on the proposed plan at the Public Hearing. These

comments brought several new perspectives to the attention of those

responsible for implementing, overseeing, and evaluating the project.

The comments highlighted instances of miscommunication and

misunderstanding with the present system as well as the project

interventions. Further, they underscored the importance of providing

training to employees and supervisors on the demonstration project. The

substance of all comments received has been conveyed to the WES

Director, Commander and Deputy Director, and the Laboratory Directors

in the event that local policies, processes, and training sessions may

benefit from such perspectives. A summary of all comments received,

along with accompanying responses, is provided below.

A. General Management Issues

Comments: Seventeen comments were in support of the project as a

way to provide incentives for promising young people to stay in the

Federal Government. Seven were opposed to the project, others were

opposed to some of the provisions in the project, and two recommend

coverage of engineers and scientists only. Many other comments were

made that addressed the organizational environment at WES. Several

comments expressed concern over a demonstration project which provides

additional flexibility to supervisors and suggested that these

flexibilities will allow for or promote abuses and compromises of the

merit system. With the feeling that many supervisors currently do not

properly execute supervisory responsibilities or utilize the authority

and tools provided under the current system, these employees fear a new

system that gives supervisors additional flexibility over their career

and pay. Several comments mentioned that no checks or oversight seem

apparent and that management accountability is lacking under the

Project.

Response: It has been the intent of WES from the inception of the

Personnel Management Demonstration Project to include the total

workforce in a broadbanding performance-based personnel management

system, not just the engineers and scientists. Internal equity,

organizational cohesiveness based on a common performance management

philosophy, and administrative efficiency are reasons WES included the

entire workforce in the project. WES acknowledges that the project

provides increased authority and responsibility to supervisors,

particularly in those areas impacting employees' pay. Experience with

other personnel demonstration projects, including the China Lake

project, does not support the assumption that increased supervisory

discretion and authority leads to merit system abuses. However, WES is

sensitive to the concerns expressed by many of the comments and is

committed to holding supervisors accountable for the proper use of

increased authorities and flexibilities. To assist supervisors in

carrying out their new responsibilities, the Personnel Management

Demonstration Project currently requires that supervisors be trained on

the new system and receive feedback from a number of sources. Aggregate

data from the feedback process will be made available to the top

management at WES and will be used to monitor and identify further

supervisory development and training needs. Project oversight will be

achieved by an executive steering committee, co-chaired by the

Assistant Secretary of the Army for Research and Technology and the

Deputy Assistant Secretary of the Army, Civilian Personnel Policy.

Additionally, extensive independent evaluations of the demonstration

project will be conducted by OPM's Personnel Resources and Development

Center over the first five years of the project. The results of these

evaluations will provide WES with information as to whether specific

provisions of the project need to be modified, continued as is, or

curtailed.

B. Occupational Family and Broadbands

Comments received on this aspect of the Personnel Management

Demonstration Project were related to two subtopics; broadbanding and

assignment of job series to occupational families.

(1) Broadbanding

(a) Comment: Four individuals expressed concern about the proposed

broadbanding structure in the Engineers and Scientists occupational

family. Two recommended that grades GS-12 through GS-14 be included in

one pay band since this was in the original WES

[[Page 10465]]

proposal. One recommended one pay band covering GS-11 through GS-15.

The other recommended that GS-13s, GS-14s, and GS-15s be placed in

separate pay bands. Concerns presented included: GS-12s at WES

consistently work at the GS-13 or GS-14 level; there is a glass ceiling

for GS-12s; GS-12s are lower than others serving on national and

international committees; expectations of wholesale transfer of GS-12s

which will be a loss to the community; retention problems; costs of

retraining new recruits; and concerns about ethical dilemmas when

raters and ratees are in the same pay band.

Response: WES recognizes there is a concern over the lack of

progression opportunities from GS-12 to GS-13 under the present system

and the desirability of establishing a pay band that would remove

promotion barriers and allow progression to a level of pay equivalent

to the GS-14 level. This is evident in the turnover of engineer and

science employees at the GS-12 level, which is the highest at WES. A

proposal was included in the first WES plan to address these issues and

to experiment with a GS-12 through GS-14 pay band for engineers and

scientists performing research, testing and evaluation, and

experimental development functions. Based on these comments and those

presented during the project development process, the pay banding

scheme for the Engineers and Scientists occupational family has been

revised to recognize a pay band covering GS-12 through GS-14. The issue

of raters and ratees in the same band was considered to be comparable

to rating levels under the present system whereby person-in-job

positions are frequently at or above the level of their raters. This is

not viewed as a potential problem.

(b) Comment: One commentor recommended that separate occupational

families, pay bands, and pay pools be established for both legal and

contracting personnel.

Response: WES currently has 3 attorneys and 13 GS-1102 contracting

employees. The creation of separate occupational families and pay bands

for each professional group is impractical, would require an inordinate

amount of time to manage, and the pay pools would be too small to

provide substantial financial rewards to recognize exceptional

performance. The legal and contracting occupations will continue to be

included in the Administrative occupational family.

(c) Comment: One commentor stated that ``the ratio of possible pay

increases caused by the banding is highly favorable to the white male

while the minorities, especially African Americans and females, will

find themselves locked in the lower paying bands.''

Response: The pay banding schemes were developed by a committee

comprised of labor, management, professional, clerical, technical, wage

grade, African American, white, male, and female employees. Pay band

considerations included the nature of work (professional,

nonprofessional, technical, support, etc.), normal level of work, and

normal career progression of employees within the various occupational

families. The results reflect progression from entry level trainee, to

intern to developmental, to journeyman, to advanced journeyman, to

expert, to managerial level. No positions were designated to bands

based on non-merit factors such as race, sex, national origin, or any

other personal considerations of incumbents. Additionally, experience

of the China Lake Project shows that broadbanding does not discriminate

based on race, sex, national origin or any other personal

considerations. To assist WES in monitoring this important issue, data

on band level salary, and workforce demographics, supplemented by

perceptual data, are included in the planned evaluation strategy.

Evaluation results will alert WES of any unintended outcomes and will

serve as the basis for decisions to modify the project.

(d) Comment: One employee voiced concern about the potential

problem of applying for a job in another agency if they were at pay

band IV in the Engineers and Scientists occupational family and the

desired job was GS-15. The employee was concerned about how the agency

would know their comparable grade level.

Response: The project includes a provision for conversion out of

the project to the General Schedule pay system. In instances such as

this, employees will be encouraged to ask prospective employers to

contact the employee's servicing Human Resources Management (HRM)

Office for comparable grades, etc., in order to make qualifications

determinations.

(2) Assignment of Job Series to Occupational Families

Comments: Three comments were submitted raising concern about the

identification of job series to occupational families. These comments

were related to the assignment of GS-0544, Civilian Pay Technician, and

GS-1106, Procurement Clerk, positions to the General Support

occupational family.

Response: The occupational families selected for the WES Personnel

Management Demonstration Project group positions by job series under

one of four occupational families: Engineers and Scientists; E&S

Technicians; Administrative; and General Support. Each occupational

family covers occupations similarly treated in regard to type of work,

typical career progression, and qualification requirements. Using these

criteria, positions designated as Civilian Pay Technician, GS-0544, and

Procurement Clerk, GS-1106, are assigned to the General Support

occupational family.

C. Performance Evaluation

Comment: One commentor had three concerns about the performance

evaluation system that will be used by this project. The commentor

recommended that a pass/fail system be adopted, three performance

elements be added to the appraisal, and the employee-to-supervisor

ratio of about 15:1 be waived.

Response: Several performance evaluation options including a pass/

fail system were considered during project development. While pass/fail

is a viable option, a system that rates an employee's performance on a

scale from 0 to 5 was adopted. The latter is believed to be more

compatible for converting performance ratings or scores to pay-for-

performance. The recommended three additional performance elements

(empowers his/her personnel, acquisition streamlining initiatives, and

support to the organization) will not be added since they are

considered to be embedded within the seven non-supervisory performance

elements or the two supervisory performance elements. The plan contains

no requirements for changing the employee-to-supervisor ratio.

D. Supervisory Pay Adjustments and Supervisory Pay Differentials

Comments: Eight comments were received (one was signed by seven

individuals) regarding the proposal to allow supervisory pay

adjustments and differentials for supervisors in the Engineers and

Scientists occupational family. One was in support of supervisory pay

adjustments and differentials. One recommended that supervisory pay

adjustments be applied equally to all engineers and scientists

supervisors rather than be variable. One commentor recommended that

adjustments and differentials be made available to all supervisors

regardless of occupational family assignment. One recommended that

supervisory pay

[[Page 10466]]

adjustments be allowed to exceed the pay band maximum pay and

considered as basic pay. The others recommended that the proposal to

allow these adjustments and differentials be withdrawn. Reasons given

included supervisory skills are supporting elements that are not

specific to mission and are generic tasks, supervisory work force is

stable, proposed plan simplifies the work of supervisors, increased pay

for supervisors will penalize direct-mission skills, and the plan

should reward individual performance not the position.

Response: The proposal to allow supervisory pay adjustments was to

attract and reward the best individuals for supervisory positions,

recognize the increased burden placed on engineers and scientists

supervisors, and to compensate supervisors who supervise employees that

are typically at the same grade level or higher. The supervisory pay

adjustment will allow an increase in pay for new supervisors who

lateral from a nonsupervisory position to a supervisory position within

the same pay band, i.e., pay band IV or V. This adjustment is not

automatic and may be varied based on a supervisor's performance, up to

a maximum of 10 percent. Supervisory pay differentials are included in

order to recognize pay for performance for supervisors who have reached

the maximum pay for their pay band. This extension of pay will be given

and adjusted based on their actual performance and the differential

will not be treated as basic pay. Supervisory adjustments and

differentials were not made available to supervisors in other

occupational families since most supervise employees in lower pay

bands.

E. Distinguished Scholastic Achievement Appointment

Comments: Eighteen individuals identified a need to modify the

Personnel Management Demonstration Project to include an initiative

that was in the original WES proposal, the establishment of a

Distinguished Scholastic Achievement Appointment which provides the

authority to appoint undergraduates and graduates with outstanding

scholastic records to positions in the Engineers and Scientists

occupational family.

Response: 5 U.S.C. 4703 states that before a personnel

demonstration project is conducted, a plan shall be developed which

identifies the methodology of the project. The plan must be published

in the Federal Register and submitted as published to public hearings.

New initiatives or substantive changes to a proposed personnel

demonstration project are not permitted without being submitted to

public hearing. The Distinguished Scholastic Achievement Appointment is

considered to be a new initiative and has not been the subject of a

public hearing. Therefore, the Distinguished Scholastic Achievement

Appointment will not be included as part of the WES Personnel

Management Demonstration Project at this time. However, WES management

intends to submit the Distinguished Scholastic Achievement Appointment

as a personnel initiative at the appropriate time in the future.

F. Voluntary Emeritus Program

Comment: One person suggested that the Voluntary Emeritus Program

be made available to retired or separated individuals regardless of

occupational family.

Response: The national prominence earned by researchers at WES

results from their unparalleled engineering and scientific

achievements. Many of the retired engineers and scientists continue to

be leaders in their professions and the Voluntary Emeritus Program

allows them the opportunity to assist WES in solving problems of

importance to the nation in broad areas of civil engineering and

environmental quality. This intervention will be retained as written

and will be monitored through the evaluation process to determine

whether it should be expanded to other occupational families.

G. Conversion Buy-In

Comments: Seven commentors were concerned that, at the time of

conversion, employees would be given a lump sum cash payment rather

than adjusting base salary for time credited toward what would have

been the employee's next within-grade increase. All believe that a one-

time payment equal to an employee's time vested in their current grade

step takes away from the employee's future earnings.

Response: WES has modified the conversion procedure so that, at the

time of conversion into the project, each employee will have their

basic pay adjusted for time credited toward what would have been the

employee's next within-grade increase.

H. Reduction-In-Force (RIF)

Comments: Five commentors were concerned with the revised RIF

procedures that place greater emphasis on performance when establishing

retention registers. Two commentors viewed the revised procedures as

unfair since performance scores are not used to adjust the service

computation date; one commentor was concerned about veterans'

preference issues; one commentor did not believe that competitive areas

should be defined as the occupational family; and the other commentor

saw no need to change current RIF procedures.

Response: The current RIF system is complicated, costly, and

relatively unresponsive to the needs of the organization. WES believes

that flexible and responsive alternatives are needed that place greater

emphasis on performance while preserving the guiding principles of

veterans' preference laws. The revised RIF procedures will disrupt the

organization the least and will increase the probability of retaining

the highest performing individuals. Under the Project, employees will

retain rights and protections during RIF. At the same time, one goal of

the Project is to expand the role of performance in various aspects of

employment. For this reason, the Project does not use performance

scores to adjust the service computation date (SCD), as one commentor

suggested. The Project instead emphasizes performance by using the most

recent employee performance score as a separate element in the order of

retention during RIF and by giving that score priority over the service

computation date in determining the order of retention. Retention

standing will be based upon the following factors, listed in order of

priority: tenure, veterans' preference, most recent employee

performance score, and SCD. The role of veterans' preference remains

unchanged from the current system. Finally, competitive areas have been

modified to make each of the four occupational families a separate

competitive area. All positions in a given occupational family,

regardless of their geographic locations, will fall within a single

competitive area.

3. Demonstration Project System Changes

Minor editorial changes were made to correct the final version of

the Project. In addition, pertinent sections of the final plan have

been modified to include: a pay band in the Engineers and Scientists

occupational family that combines GS 12-14 positions (Section III, A,

Broadbanding); and an adjustment of basic pay for the time credited

toward the employee's next within-grade increase at the time of

conversion into the project (Section V, A, Conversion to the

Demonstration Project).

Dated: February 26, 1998.

[[Page 10467]]

Office of Personnel Management.

Janice R. Lachance,

Director.

Table of Contents

I. Executive Summary

II. Introduction

A. Purpose

B. Problems with the Present System

C. Changes Required and Expected Benefits

D. Participating Organization

E. Participating Employees

F. Project Design

III. Personnel System Changes

A. Broadbanding

B. Classification

C. Pay for Performance

D. Pay Setting Provisions

E. Hiring and Placement Authorities

F. Employee Development

G. Reduction in Pay or Removal Actions

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

IV. Training

A. Supervisors

B. Administrative Staff

C. Employees

V. Conversion

A. Conversion to the Demonstration Project

B. Conversion from the Demonstration Project

VI. Project Duration

VII. Evaluation Plan

VIII. Demonstration Project Costs

IX. Required Waivers to Law and Regulations

A. Waivers to Title 5, U.S. Code

B. Waivers to Title 5, Code of Federal Regulations

Appendix A: Intervention Impact Model: Project Evaluation

I. Executive Summary

The Department of the Army (DA) will establish Personnel

Demonstration Projects generally similar to the system currently in use

at the Navy Personnel Demonstration Project known as China Lake. The

Personnel Demonstration Projects will be developed to be in-house

budget neutral, based on a baseline of September 1995 in-house costs

and consistent with the DA plan to downsize the DA laboratories and

research and development centers. 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 was designed by the Assistant Secretary of the Army

for Research, Development and Acquisition with the support of the

Assistant Secretary of the Army for Civil Works, and the participation

of five Army S&T Reinvention Laboratories. Review was provided by the

US Army Corps of Engineers, DA, DoD, and OPM. Phases of the project

that address non-Title 5 issues began as early as 1 October 1995, with

implementation of Title 5 initiatives to begin no earlier than June 3,

1998.

This project is built upon the concepts of linking performance to

pay for all covered positions, simplifying paperwork in the processing

of classification and other personnel actions, emphasizing partnerships

among management, employees, and unions, and delegating other

authorities to line managers.

II. Introduction

A. Purpose

The quality of DoD laboratories, their people, and products has

been under intense scrutiny in recent years. The perceived

deterioration of laboratory 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. The

purposes of the demonstration project are to: Improve the hiring

process and allow WES to compete more effectively for high-quality

personnel; motivate and retain staff through pay for performance,

sabbaticals, and a more responsive personnel system; strengthen the

manager's role in personnel management through increased delegation of

personnel authorities; increase the efficiency of the personnel system

by simplifying the classification system through broadbanding and

reduction of guidelines, steps, and paperwork; and create a model that

could be adopted by other government agencies.

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

MACOM Commander will execute and manage the project.

Project oversight 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.

B. Problems With the Present System

The civilian personnel system currently in use at DoD laboratories

has several major inefficiencies, which hinder management's ability to

recruit and retain the best qualified personnel. Line managers have

only limited flexibility to administer personnel resources, and

existing personnel regulations are often in conflict with line

management's ability to perform world-class research. Laboratory

managers are frustrated in their attempts to hire the best and

brightest engineers and scientists.

The classification system requires lengthy, narrative, individual

position descriptions, which have to be classified by the use of

complex and often outdated position classification standards. The

system causes delays in recruiting, reassigning, promoting, and

removing employees. Rewarding or taking a performance based action

requires inordinate paperwork and time, often discouraging managers

from pursuing critical actions. Few incentives, with limited

flexibility, exist for managers to deal with all levels of the

workforce, and pay is not always commensurate with an employee's

performance. The current RIF system does not adequately recognize

performance as a major criterion in RIF situations. The RIF rules are

complex, and difficult to understand and administer. The RIF process

disrupts operations, due to displacement of employees within their

competitive levels and in the exercise of bumping and retreat rights.

C. Changes Required and Expected Benefits

This project is expected to demonstrate that a human resource

management system tailored to the mission and need of WES will result

in: Increased quality in the engineering and science workforce and the

laboratory products they produce; increased timeliness of key personnel

processes; trended workforce data that reveals increased retention of

excellent contributors and separation rates of poor contributors; and

increased customer satisfaction with the laboratory and its products by

customers serviced.

This demonstration program 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 job satisfaction of their employees

versus that for the federal workforce in general. This demonstration

expects similar successes. A full range of data will be collected to

evaluate the project (and is described in Section VII, Evaluation

Plan).

[[Page 10468]]

D. Participating Organization

U.S. Army Engineer Waterways Experiment Station, 3909 Halls Ferry

Road, Vicksburg, Mississippi 39180-6199. Employees assigned to WES work

at the locations shown in Table 1.

Table 1.--Duty Locations

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

Total No.

Location of

employees

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

London, England............................................ 1

Berkeley, CA............................................... 1

Mobile, AL................................................. 3

Washington, DC............................................. 1

Fayette, NC................................................ 1

Natchez, MS................................................ 1

Vicksburg, MS.............................................. 1,312

Duck, NC................................................... 10

Calhoun Falls, SC.......................................... 2

Lewisville, TX............................................. 3

North Bonneville, WA....................................... 3

Dallesport, WA............................................. 1

Spring Valley, WI.......................................... 2

Omaha, NE.................................................. 56

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

E. Participating Employees

The project will cover all General Schedule (GS) employees assigned

to WES. Federal Wage System (FWS) employees, Civilian Intelligence

Personnel Management System (CIPMS) employees covered by Title 10, and

5 U.S.C. 3105 Scientific and Technical (ST) employees are not covered,

but will follow the same employee development provisions of this plan,

except, in the case of CIPMS employees, where the provisions are found

to be in conflict with CIPMS. The occupational series of employees

included in the project are identified by occupational family in Table

2. All GS employees with appointments exceeding one year will be

covered by the provisions of this project. GS employees with

appointments limited to one year or less will be covered for pay

banding, the performance appraisal process, and salary adjustments.

Senior Executive Service (SES) employees will not be included in the

project. It is the intent of WES to expand coverage of the project to

all FWS employees 1 to 2 years following the date of implementation. In

the event of expansion to FWS employees beyond the employee development

provisions, full approval will be obtained from DA, DoD, and OPM.

The American Federation of Government Employees (AFGE) represents

approximately 500 GS and FWS employees at WES. The AFGE represents most

E&S Technicians; most Administrative employees; all General Support

employees except fire protection inspectors, security guards, student

trainees, and those designated as confidential employees; and all

nonsupervisory FWS employees. WES plans to implement this project on

June 3, 1998. Bargaining unit employees will be included in the project

at that time if Impact and Implementation bargaining is complete. If

Impact and Implementation bargaining has not been completed on the date

of project implementation, employees represented by AFGE Local 3310 may

not be brought into the project until completion of the bargaining

process. AFGE Local 3310 has been involved with and participated in the

development of the project since its inception. WES will continue to

fulfill its obligation to consult or negotiate with the AFGE, as

appropriate, in accordance with 5 U.S.C. 4703 (f) and 7117. The

participation with the AFGE is within the spirit and intent of

Executive Order 12871.

Table 2.--Occupational Series Included in the Demonstration Project

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

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

Engineers & Scientists

0023 Outdoor Recreation Planner

0150 Geographer

0193 Archeologist

0401 Biologist

0403 Microbiologist

0408 Ecologist

0410 Zoologist

0414 Entomologist

0430 Botanist

0434 Plant Pathologist

0435 Plant Physiologist

0470 Soil Scientist

0471 Agronomist

0482 Fishery Biologist

0486 Wildlife Biologist

0499 Student Trainee

0690 Industrial Hygienist

0801 General Engineer

0803 Safety Engineer

0806 Materials Engineer

0807 Landscape Architecture

0808 Architecture

0810 Civil/Hydraulic/Structural Engineer

0819 Environmental Engineer

0830 Mechanical Engineer

0850 Electrical Engineer

0854 Computer Engineer

0855 Electronics Engineer

0893 Chemical Engineer

0896 Industrial Engineer

0899 Student Trainee

1301 Physical Scientist

1310 Physicist

1313 Geophysicist

1315 Hydrologist

1320 Chemist

1350 Geologist

1360 Oceanographer

1399 Student Trainee

1515 Operations Research Analyst

1520 Mathematician

1530 Statistician

1550 Computer Scientist

1599 Student Trainee

E&S Technicians

0028 Environmental Protection Specialist

0802 Engineering Technician

0818 Engineering Draftsman

0856 Electronics Technician

1311 Physical Science Technician

1371 Cartographic Technician

1521 Mathematics Technician

1670 Equipment Specialist

Administrative

0018 Safety & Occupational Health

Specialist

0099 Student Trainee

0260 Equal Employment Opportunity

Specialist

0301 Info Syst Mgr Spec/Joint Test Prog Mgt

Coordinator/Emergency Oper Mgr

0334 Computer Specialist

0341 Administrative Officer

0343 Mgt & Prog Analysis Officer

0346 Logistics Management Officer

0391 Telecommunications Officer

0399 Student Trainee

0505 Financial Manager

0510 Accountant

0511 Auditor

0560 Budget Officer

0599 Student Trainee

0610 Nurse

0905 General Attorney

0950 Paralegal Specialist

1020 Illustrator

1035 Public Affairs Specialist

1060 Photographer

1071 Audiovisual Specialist

1082 Editor

1084 Visual Information Specialist

1102 Contract Specialist

1104 Property Disposal Specialist

1199 Student Trainee

1410 Librarian

1412 Technical Information Specialist

1499 Student Trainee

1712 Training Instructor

2001 General Supply Specialist

2101 Transportation Specialist

General Support

0019 Safety Technician

0081 Firefighter

0085 Security Guard

0090 Guide

0099 Student Trainee

0302 Messenger

0303 Clerk

0305 Mail & File Clerk

0312 Clerk-Stenographer

0318 Secretary

0322 Clerk-Typist

0326 Office Automation Clerk

0332 Computer Operator

0335 Computer Clerk

0344 Management Assistant

0361 Equal Employment Opportunity Assistant

0394 Communications Clerk

0503 Financial Clerk & Assistant

0525 Accounting Technician

0530 Cash Processing Technician

0540 Civilian Pay Technician

0544 Teller

[[Page 10469]]

0561 Budget Clerk

0986 Legal Clerk

1105 Purchasing Clerk

1106 Procurement Clerk

1107 Property Disposal Clerk

1411 Library Technician

2005 Supply Clerk

2102 Transportation Clerk

2131 Freight Rate Specialist

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

F. Project Design

In August 1994, a Project Manager was appointed to lead the WES

reinvention effort. The Project Manager was assisted by a

representative of the servicing HRM Office. During October-November

1994, a WES concept plan was developed to map out desired areas in

which to propose changes in the personnel system. The concept plan was

then merged into a single Army plan for the participating Army S&T

Laboratories and was submitted to the DA in December 1994.

WES formed four teams in January 1995 to develop specific

initiatives to be undertaken in the WES demonstration project. The

teams were composed of 7 to 14 employees each and included

representatives from management, engineers, scientists, technicians,

clerical, administrative, wage grade, human resources, and

representatives from the local union. The teams developed human

resources management initiatives which were designed to: assist in

hiring the best people to accomplish the mission; improve training and

development of the workforce; improve and simplify the position

classification process; develop a broadband system to facilitate

classification and career progression; and develop a pay for

performance system to recognize employee contributions to mission

accomplishment.

The Army's plan was reviewed concurrently by DoD and OPM in April

1996. It was recommended that each Army lab submit individual project

plans. The second joint review by DoD and OPM of the lab plans was

conducted in September 1996. The philosophy and intent of WES

throughout the process of project development was the inclusion of its

total workforce. As such, a pay-for-performance broadbanding system was

developed for FWS employees, in partnership with representation from

the bargaining unit, and was included as part of the WES plan. At the

joint reviews, the DoD Civilian Personnel Management Service and OPM's

Office of Classification and Office of Compensation Policy considered

the broadbanding of FWS employees as outlined in the WES plan to be

inappropriate. FWS employees were removed from the plan but will follow

the same employee development provisions of this plan. Options for

including them in a pay-for-performance system at a later date will be

developed by WES, DA, DoD, and OPM.

This plan and these initiatives are the result of many months of

effort by dedicated participants at WES, U.S. Army Corps of Engineers,

DA, DoD, and OPM levels.

III. Personnel System Changes

A. Broadbanding

1. Pay Bands

Each occupational family will be composed of discrete pay bands

corresponding to recognized career advancement within the occupations.

The pay bands will replace grades. The pay bands will not be the same

for all occupational families. Each occupational family will be divided

into four to six pay bands, each pay band covering the same pay range

now covered by one or more grades. The minimum rate of basic pay for a

band will be the minimum rate for the lower grade in the band as shown

on the regular GS schedule. The maximum rate of basic pay for a pay

band will be the highest regular schedule GS rate possible for

positions within that occupational family and pay band. 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

salary within a pay band.

The proposed pay bands for the occupational families and how they

relate to the current GS grades are shown in Table 3. This pay band

concept has the following advantages because it: reduces the number of

classification decisions required during an employee's career;

simplifies the classification decision-making process and paperwork;

supports delegation of classification authority to line managers;

provides a broader range of performance-related pay for each pay band;

and prevents the progression of low performers through a pay band by

mere longevity, since job performance serves as the basis for

determining pay.

The WES pay banding plan expands the pay banding concept used at

China Lake and NIST by creating pay band VI of the Engineers and

Scientists occupational family. This pay band is designed for Senior

Scientific Technical Managers.

Current legal definitions of Senior Executive Service (SES) and ST

positions do not fully meet the needs of WES. The SES designation is

appropriate for executive level managerial positions whose

classification exceeds the GS-15 grade level. The primary knowledge 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.

Table 3.--Occupational Families and Pay Bands

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

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

Occupational families

(15)Pay Bands

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

Engineers and Scientists (E&S)*................

(3)I

(5)II

(1)III

(1)IV V VI

(3)(N)

(5)(N)

(1)(E)

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

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

E&S Technicians................................

(3)I

(2)II

(2)III

(1)IV

(3)(N)

(2)(N)

(2)(N)

(1)(E)

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

Administrative.................................

(3)I

(5)II

(1)III

(1)IV V

(3)(N)

(5)(N)

(1)(E)

(1)(E) (E)

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

General Support................................

(2)I

(1)II

(1)III

(1)IV

(2)(N)

(1)(N)

(1)(N)

(1)(E)

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

[[Page 10470]]

Corresponding GS Grades........................ 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 Above

15

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

*Engineers and Scientists pay band II includes a mix of positions: positions equivalent to GS-5 through 10 involve research, test, evaluation, and equipment development work as well as non-

research work; positions equivalent to GS-11 involve research work. Pay band III includes non-research positions, e.g., engineers in public works. Pay band IV positions equivalent to GS-12

through GS-14 involve research work; the balance of band IV includes a mix of research and non-research supervisory positions, and program managers. FLSA Codes: N=Nonexempt; E=Exempt.

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

WES currently has a few positions which typically have

characteristics of both SES and ST classifications. Most of these

positions are responsible for supervising other GS-15 positions,

including branch or division chiefs, non-supervisory research engineers

and scientists, and potential ST positions. These positions are

classified at the GS-15 level, although their technical expertise

warrants classification beyond GS-15. Because of their management

responsibility, these individuals are excluded from the ST system.

Because of management considerations, they cannot be placed in the

SES. WES management considers the primary requirement for the positions

to be knowledge of and expertise in the specific scientific and

technology areas related to the mission of the organization.

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 VI (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. Payband

VI 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-15s will convert into the demonstration project at pay

band V. After conversion they will be reviewed against established

criteria to determine if they should be reclassified to pay band VI.

Other positions possibly meeting criteria for classification to pay

band VI will be reviewed on a case-by-case basis. The proposed salary

range is a minimum of 120 percent 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 VI 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.

Selection panels will be created to assist in filling Payband VI

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

SES members, ST employees, and later those in Payband VI, and an equal

number of individuals of equivalent stature from outside the laboratory

to ensure impartiality, 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 VI for a 5-year period.

Positions established in pay band VI will be subject to limitations

imposed by OPM and DoD. Pay band VI positions will be established only

in an S&T Reinvention Laboratory which employs scientists, engineers,

or both. Incumbents of pay band VI 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 VI positions within 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 VI positions will be reviewed

periodically to determine appropriate position requirements. Pay band

VI position allocations will be managed separately from SES, ST, and

Senior Level (SL) positions. An evaluation of the pay band VI concept

will be performed during the fifth year of the demonstration project.

The final component of pay band VI is the management of all pay

band VI assets. Specifically, this authority will be exercised at the

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

abolish positions within the 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.

2. Occupational Families

Positions will be grouped into occupational families according to

similarities in type of work and customary requirements for formal

training or credentials. The historical patterns of advancement within

the occupational families will be considered. The current positions and

grades at WES have been examined, and their characteristics and

distribution have served as guidelines in the development of

occupational families. Four occupational families will be established:

(a) Engineers and Scientists. This occupational family includes all

technical professional positions such as engineers (civil, hydraulic,

structural, mechanical, electronic, electrical, chemical, and

environmental), mathematicians, statisticians, computer scientists,

outdoor recreational planners, geographers, architects, archaeologists,

operations research analysts, and a variety of physical and biological

scientists. Specific course work or educational degrees are required

for positions in this occupational family.

(b) E&S Technicians. This occupational family consists of the

positions that support the various engineering and scientific

activities. Employees in this occupational family are required to have

training and skills in the various technical areas (civil, hydraulic,

structural, geotechnical, physical, coastal, biological, chemical).

(c) Administrative. This occupational family contains specialized

functions in such fields as counsel, audit, finance, procurement,

public information, accounting, administrative, computing, safety, and

management analysis. Special training and skills in administrative

fields or special degrees are required.

[[Page 10471]]

(d) General Support. This occupational family is composed of

positions requiring special skills and knowledge, such as typing or

shorthand, 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. Other support functions include the work of secretaries, legal

clerks, guards, mail clerks, etc.

3. Fair Labor Standards Act

Fair Labor Standards Act (FLSA) exemption and nonexemption

determinations will be made consistent with criteria found in 5 CFR

part 551. All employees are covered by the FLSA unless they meet the

executive, administrative, or professional criteria for exemption. As a

general rule, the FLSA status can generally be matched to the

occupational families and pay bands found in Table 3. Exceptions to

these guidelines include supervisors/managers who meet the definitions

outlined in the OPM General Schedule Supervisory Guide. The generic

position descriptions will not be the sole basis for the FLSA

determination. Each position will be evaluated on a case by case basis

by comparing the duties and responsibilities assigned, the

classification standards for each pay band, under 5 CFR part 551

criteria.

B. Classification

1. Coverage

The present GS classification system has over 400 occupations (also

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

occupational series will be maintained. New series may be added as

needed to reflect new occupations in the work force when established by

OPM.

2. Classification Standards

The classification system will be modified to facilitate pay

banding. The present classification standards will be used to create

local benchmark position description/standards 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. 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 specialty

codes and OPM functional codes will be used to facilitate titling,

making qualification determinations, and assigning competitive levels

to determine retention status.

3. Position Descriptions and Classification Process

New standardized position descriptors will be developed to assist

managers in exercising delegated position classification authority.

Managers will identify the appropriate pay band and descriptor

definition and proceed to finalize the position description. A cover

sheet similar to the present DA Form 374 will be used to reflect their

classification decision. The cover sheet used will include a provision

for designating specialty codes. These specialty codes will be

developed to identify the special nature of work performed and will be

included on the final position descriptor.

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 OPM 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 accuracy of the position

description, the demonstration project classification criteria, or the

pay-setting criteria; the assignment of occupational series to the

occupational family; 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

Civilian Personnel Office/Human Resources Office providing personnel

service and will include copies of appropriate demonstration project

criteria.

C. Pay for Performance

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

ability of WES 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.

1. Determining Pay Increases

Compensation will be allocated to employees through organizational

compensation pools. The WES Director, Commander and Deputy Director,

and Laboratory Directors at WES will manage their respective pools.

The compensation pools will have two components: Funds for

performance pay increases (money previously available for within-grade

increases, quality step increases, and promotions between grades that

are banded under the project); and funds for General Schedule pay

increases. Performance awards (cash awards and bonuses presently

allowed) and locality pay increases will continue under the project and

will be excluded from the compensation pools. The compensation pools

will be managed to ensure relative cost neutrality. As a result, funds

will not be shifted between pools.

Annual base pay increases paid from the performance pay increase

component of the compensation pools will be based on eligibility as

well as scores on the established standards as follows:

[GRAPHIC] [TIFF OMITTED] TN03MR98.003

Where:

PR = employee's annual performance-based pay raise, $

V = value of a share, percent

S = number of shares earned by employee based on performance

P = employee's salary prior to pay raise

The number of shares earned by an employee will vary from 0 to 4

and will depend upon their performance score. A performance pay

increase may not cause the employee's rate of basic pay to exceed the

maximum rate of the pay band.

The value of a share will be computed in a manner to ensure that

the amount of money available for performance pay increases will not

exceed the amount of money in a compensation pool that is available for

raises. Therefore, the amount of money available annually within a pay

pool for performance-based pay raises is:

[[Page 10472]]

[GRAPHIC] [TIFF OMITTED] TN03MR98.004

Where:

A = average annual historical pay raise, percent

M = pay pool size, $

Pi = salary of employee I

n = number of employees in compensation pool

The share value (percent) is computed in a manner to ensure exact

expenditure of the amount of money in the compensation pool as follows:

[GRAPHIC] [TIFF OMITTED] TN03MR98.005

Where:

Si = number of shares earned by employee I based upon

performance

ne = number of employees within compensation pool that are

eligible for a performance-based pay raise

A payout function that correlates number of shares earned by an

employee for a performance based pay raise to average performance score

will be similar to the plot shown in Figure 1.

The annual General Schedule pay increase will be allocated as

follows:

(a) The first step is setting the percentage General Schedule

increase that will be given to all eligible employees. This amount will

be equal to the General Schedule increase authorized for GS employees.

All employees whose average performance score is 2.0 or greater will be

eligible for the increase. Employees with an average performance score

of less than 2.0 will be ineligible for the full General Schedule

increase and may receive either none or one-half of the increase. Pay

increases for employees receiving retained rates will be determined in

accordance with 5 U.S.C. 5363 except that those with an average

performance score of less than 2.0 may receive either none or one-

quarter of the increase in the maximum rate of basic pay for the

applicable pay band.

Figure 1. Relation Between Shares Earned for Performance and

Average Performance Score

BILLING CODE 6325-01-P

[GRAPHIC] [TIFF OMITTED] TN03MR98.002

BILLING CODE 6325-01-C

(b) The minimum and maximum pay rates of basic pay for each pay

band in an occupational family will be adjusted by any general pay

increase to reflect the new rates in accordance with the criteria

reflected in Section III, A, Broadbanding, of this plan. The maximum

pay rate for pay band VI cannot exceed the rate for SES level 4.

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

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

2. Performance Evaluation

The performance appraisal system will link compensation to

performance

[[Page 10473]]

through annual performance evaluations and performance ratings.

Performance will be evaluated against generic performance standards.

Rating elements will be provided for all employees. All rating elements

will be critical and scored on a scale of 0 to 5. The score will be

based on employees performance as evaluated against generic performance

standards for each element. The supervisor will discuss performance

rating standards with the employee to clarify performance criteria at

the beginning of the rating period. The generic performance standards,

with the provision to add specific work plans, will be used to evaluate

employee performance. The standards will describe the level of

performance required for the employee to be rated fully successful.

Reviews will be conducted at least at mid-year to evaluate employee

progress in meeting performance standards. However, WES interns in

recognized career programs will be appraised semi-annually until they

complete their internship. The last performance rating in each annual

cycle will be considered to be the rating of record.

Since all employees will not have the same number of rating

elements, the element scores will be summed and averaged by the number

of elements rated to determine the overall performance score. The score

will be used for setting performance pay increases and determining

eligibility for performance awards.

Employees must have an average performance score of 2.5 and above

to be eligible for performance pay increases. Employees with an average

performance score of 2.0 or greater will be eligible for performance

awards and full General Schedule increases. Employees with an average

score of less than 2.0 will be ineligible for performance awards and

full General Schedule increases. A within-the-year review may be used

to reevaluate employees with performance scores of less than 2.0. If

the employee's performance has improved sufficiently since the last

rating period, the employee may be eligible for a nonretroactive

General Schedule pay raise at that time.

3. Awards

WES currently has an extensive awards program consisting of both

internal and external awards. On-the-spot, special act, and other

internal awards (both monetary and nonmonetary) will continue under the

project. MACOM, DA, and DoD awards and other honorary noncash awards

will be retained.

Cash awards may be given for performance and to recognize and

encourage special contributions. Awards can be made to individuals,

teams, or organizations. Awards must be approved at a managerial level

at least one level higher than the recommending official except in the

case where the WES Director is the recommender. Cash awards will not be

considered to be a part of base pay.

D. Pay Setting Provisions

1. Pay and Compensation

(a) Pay Ceilings. An employee's total monetary compensation paid in

a calendar year may not exceed the rate of basic pay for level I of the

Executive Schedule consistent with 5 U.S.C. 5307 and 5 CFR part 530,

subpart B. Each pay band will have its own pay ceiling, just as grades

do in the GS system. Basic pay rates for the various pay bands will be

directly keyed to the GS basic rates of pay except for pay band VI in

the Engineers and Scientists occupational family. Pay band VI will have

pay rates keyed to a minimum of 120% of the minimum rate of basic pay

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

for SES level 4.

(b) Staffing Supplements. Employees assigned to occupational series

and geographic areas covered by special rates will be eligible for a

staffing supplement if the maximum adjusted rate for the banded GS

grades to which assigned is a special rate that exceeds the maximum GS

locality rate for the banded grades (e.g., certain engineers in pay

bands II and III). The staffing supplement is added to the base pay,

much like locality rates are added to base pay. The employee's total

pay immediately after implementation of the demonstration project will

be the same as immediately before the demonstration project, but a

portion of the total will be in the form of a staffing supplement.

Adverse action and pay retention provisions will not apply to the

conversion process as there will be no change in total salary. The

staffing supplement is calculated as described below.

Upon conversion, the demonstration base rate will be established by

dividing the old GS adjusted rate (the higher of special rate or

locality rate) by the staffing factor. The staffing factor will be

determined by dividing the maximum special rate for the banded grades

by the GS unadjusted rate corresponding to that special rate (step 10

of the GS rate for the same grade as the special rate). The employee's

demonstration staffing supplement is derived by multiplying the

demonstration base rate by the staffing factor minus one. So the

employee's final demonstration special staffing rate equals the

demonstration base rate plus the special staffing supplement; this

amount will equal the employee's former GS adjusted rate. Simplified,

the formula is:

[GRAPHIC] [TIFF OMITTED] TN03MR98.006

Staffing supplement=Demonstration base rate x (staffing factor--1)

Salary upon conversion=Demonstration base rate + staffing supplement

(sum will = existing rate)

Example: In the case of a GS-801-11/03 employee who is receiving a

special salary rate, the salary before the demonstration project is

$42,944. The maximum special rate for a GS-801-11 Step 10 is $51,295

and the corresponding regular rate is $46,523. The staffing factor is

computed as follows:

[[Page 10474]]

[GRAPHIC] [TIFF OMITTED] TN03MR98.007

Then to determine the staffing supplement, multiply the

demonstration base by the staffing factor minus 1.

[GRAPHIC] [TIFF OMITTED] TN03MR98.008

The staffing supplement of $3,996 is added to the demonstration

base rate of $38,948 and the total salary is $42,944, which is the

salary of the employee before conversion to the demonstration project.

If an employee is in a band where the maximum GS adjusted rate for

the banded grades is a locality rate, when the employee is converted

into the demonstration, the demonstration base rate is derived by

dividing the employee's former GS adjusted rate (the higher of locality

or special rate) by the applicable locality pay factor. The employee's

demonstration locality-adjusted rate will equal the employee's former

GS adjusted rate.

Any General Schedule or special rate schedule adjustment will

require recomputation of the staffing supplement. Employees receiving a

staffing supplement remain entitled to an underlying locality rate,

which may over time supersede the need for a staffing supplement. If

OPM discontinues or decreases a special rate schedule, affected

employees will be entitled to pay retention. Upon geographic movement,

an employee who receives the special staffing supplement will have the

supplement recomputed. Any resulting reduction in pay will not be

considered an adverse action or a basis for pay retention.

Established salary including the staffing supplement will be

considered basic pay for the same purposes as a locality rate under 5

CFR 531.606(b), i.e., for purposes of retirement, life insurance,

premium pay, and severance pay purposes and for advances in pay. It

will also be used to compute worker's compensation payments and lump

sum payments for accrued and accumulated annual leave.

2. 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, whether by performance pay

increases or supervisory adjustments, 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 RIF procedures.

(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-in-the-job promotions.

(g) Promotion resulting from the accretion of duties and

responsibilities.

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

classification error.

Upon promotion to a higher pay band, an employee will be entitled

to a 6 percent basic pay increase or the lowest level in the pay band

to which promoted, whichever is greater.

3. Link Between Promotion and Performance

Noncompetitive promotions (e.g., accretion of duties, recognition

of impact of person-in-job, career ladder) will require an acceptable

level of performance in their current position. To be promoted

noncompetitively from one band to the next within an occupational

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

and have a current average performance score of 2.5 or above (Section

III, C, Pay for Performance) or equivalent under a different

performance management system (an equivalence chart will be developed

by HRM specialists and included in the implementation instructions).

Selection of employees through competitive procedures will require a

current average performance score of 2.5 or above.

4. Supervisory Pay Adjustments

Supervisory pay adjustments may be used, at the discretion of the

WES Director, to compensate employees in the Engineers and Scientists

occupational family in supervisory positions. Employees in pay band VI

of the Engineers and Scientists occupational family are excluded from

receiving supervisory pay adjustments. Supervisory pay adjustments are

increases to the supervisor's basic rate of pay, ranging up to 10

percent of that pay rate, subject to the constraint that the adjustment

may not cause the employee's basic rate of pay to exceed the pay band

maximum rate. Only employees in supervisory positions with formal

supervisory authority meeting that required for coverage under the OPM

GS Supervisory Guide will be considered for the supervisory pay

adjustment. Criteria to be considered in determining the pay increase

percentage include the following organizational and individual employee

factors: needs of the organization to attract, retain, and motivate

high quality supervisors; budgetary constraints; years of supervisory

experience; amount of supervisory training received;

[[Page 10475]]

performance; and managerial impact on the organization.

Conditions, after the date of conversion into the demonstration

project, under which the application of a supervisory pay adjustment

will be considered are as follows:

(a) New hires into supervisory positions will have their initial

rate of basic pay set at the supervisor's discretion within the pay

range of the applicable pay band. This rate of pay may include a

supervisory pay adjustment determined using the ranges and criteria

outlined above.

(b) An employee selected for a supervisory position that is within

the employee's current pay band may also be considered for a

supervisory pay adjustment.

(c) If a supervisor is already authorized a supervisory pay

adjustment and is subsequently selected for another supervisory

position, within the same pay band, then the supervisory pay adjustment

will be redetermined.

(d) An employee promoted to a supervisory position in a higher pay

band may be considered for a supervisory adjustment in addition to the

pay increase that resulted from the promotion.

Supervisors, upon initial conversion into the demonstration project

into the same, or substantially similar position, will be converted at

their existing basic rate of pay and will not be given a supervisory

pay adjustment at conversion.

Before supervisory employees may receive the pay adjustment, they

must sign a statement acknowledging that the entire adjustment will be

immediately withdrawn if they are removed from the supervisory position

because of unacceptable performance or conduct. Supervisory employees

who are reassigned to a nonsupervisory position for any other reasons

(i.e., employee choice, management directed reassignment, or RIF) will

receive one-half of the pay adjustment for one year following the

reassignment. Eliminations or reductions in supervisory pay adjustments

are not adverse actions, are not subject to appeal, and are not covered

under pay retention provisions.

5. Supervisory Pay Differentials

Supervisory pay differentials may be used, at the discretion of the

WES Director, to incentivize and reward supervisors in the Engineers

and Scientists occupational family in pay bands IV and V whose pay is

at the maximum rate of the pay band. Employees in pay band VI of the

Engineers and Scientists occupational family are excluded from

receiving supervisory pay differentials. Formal supervisory authority

meeting that required for coverage under the OPM GS Supervisory Guide

is required. A supervisory pay differential is a cash incentive, paid

out on a pay period basis, which is not included as part of the

supervisor's basic rate of pay. The differential may be up to 10

percent of the supervisor's basic rate of pay. Criteria to be

considered in determining the amount of this supervisory pay

differential includes those identified for supervisory pay adjustments.

Supervisors, upon initial conversion into the demonstration project

into the same, or substantially similar position, will be converted at

their existing basic rate of pay and will not be given a supervisory

pay differential upon conversion. The differential will be terminated

if the employee is removed from a supervisory position, regardless of

cause.

As specified in the Supervisory Pay Adjustment Section, all

personnel actions involving a supervisory differential will require a

statement signed by the employee acknowledging that the differential

may be terminated or reduced at the discretion of the WES Director. The

termination or reduction of the differential is not an adverse action,

is not subject to appeal, and is not covered under pay retention

provisions.

E. Hiring and Placement Authorities

1. Modified Term Appointments

WES conducts many research and development projects that range from

3 to 6 years. The current 4-year limitation on term appointments

imposes a burden on laboratory managers by forcing the termination of

some term employees prior to completion of projects they were hired to

support. This disrupts the research and development process and reduces

the ability of WES to serve its customers.

Under the demonstration project, WES will have the authority to

hire individuals under modified term appointments. These appointments

will be used to fill positions for a period of more than 1 year but not

more than 5 years when the need for employee's services is not

permanent. The modified term appointments differ from term employment

as described in 5 CFR part 316 in that they may be made for a period

not to exceed 5, rather than 4 years. The WES Director is authorized to

extend a term appointment 1 additional year.

Employees hired under the modified term appointment authority may

be eligible for conversion to career-conditional appointments. To be

converted, the employee must: have been selected for the term position

under competitive procedures, with the announcement specifically

stating that the individual(s) selected may be eligible for conversion

to a career-conditional appointment at a later date; have served 2

years of continuous service in the term position; be selected under WES

merit promotion procedures for the permanent position; and have a

current performance score of 2.5 or better.

Employees serving under term appointments at the time of conversion

to the demonstration project will be converted to the new modified term

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 performance

score of 2.5 or better and are selected under merit promotion

procedures for the permanent position after having completed 2 years of

continuous service. Time served in term positions prior to conversion

to the modified term appointment is creditable, provided the service

was continuous. Employees serving under modified term appointments

under this plan will be covered by the plan's pay-for-performance

system.

2. Extended Probationary Period

A new employee needs to demonstrate adequate contribution during

all cycles of a research effort for a laboratory manager to render a

thorough evaluation. The current 1-year probationary period will be

extended to 2 years for all newly hired career employees in the

Engineers and Scientists occupational family. The purpose of extending

the probationary period is to allow supervisors an adequate period of

time to fully evaluate an employee's contribution and conduct.

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

current probationary period, including the criteria for crediting prior

service and the limited notice and appeal rights, are retained. The

requirements for conversion to career tenure are unchanged. Employees

appointed prior to the implementation date will not be affected.

Probationary employees will be terminated when the employee fails

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

work contribution for continued employment. When WES decides to

terminate an

[[Page 10476]]

employee serving a probationary period because their work contribution

or conduct during this period fails to demonstrate their fitness or

qualifications for continued employment, it shall terminate their

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 WES's

conclusions as to the inadequacies of their work contribution or

conduct.

3. Voluntary Emeritus Program

Under the demonstration project, the WES Director will have the

authority to offer retired or separated engineers and scientists

voluntary assignments in the laboratory. This authority will include

engineers and scientists who have retired or separated from Federal

service. Voluntary Emeritus Program assignments are not considered

``employment'' by the Federal Government (except for 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 higher paid individuals to accept retirement

incentives with the opportunity to retain a presence in the scientific

community. The program will be of most benefit during manpower

reductions as senior engineers and scientists could accept retirement

and return to provide valuable on-the-job training or mentoring to less

experienced employees.

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

recommended by a Laboratory Director to the WES Director. Everyone who

applies is not entitled to a voluntary assignment. The WES Director

must clearly document the decision process for each applicant (whether

accepted or rejected) and retain the documentation.

To ensure success and encourage participation, the volunteer's

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

affected while serving in a voluntary capacity. Retired or separated

federal employees may accept an emeritus position without a waiting

period.

Volunteers will not be permitted to monitor contracts on behalf of

the government or to participate on any contracts or solicitations

where a conflict of interest exists. The same rules that currently

apply to source selection members will apply to volunteers.

An agreement will be established between the volunteer and WES. The

agreement will be reviewed by the local Office of Counsel for ethics

determinations under the Joint Ethics Regulation. 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 laboratory (travel, administrative,

office space, supplies);

(f) A one page Statement of Duties;

(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 assignment will be managed by the laboratory while the

volunteer is a member of the Voluntary Emeritus Program).

F. Employee Development

The objective of the employee development program will be to

develop the competence of employees for maximum achievement of

Laboratory, MACOM, DA, and DoD goals. WES will continue its employee

development programs, such as local training, off-site training, long-

term training, and developmental assignments. Under this Project, the

opportunity to apply for expanded developmental opportunities to

include sabbaticals and training for degrees, which was previously

restricted, will be made available to permanent employees.

1. Sabbatical

WES will have the authority to grant paid sabbaticals to career

employees to permit them to engage in study or uncompensated work

experience that will contribute to their development and effectiveness.

Each sabbatical should benefit WES as well as increase the employee's

individual effectiveness. Examples are as follows: advanced academic

teaching, study, or research; self-directed (independent) or guided

study; and on-the-job work experience with a public, private, or

nonprofit organization. Each recipient of a sabbatical must sign a

continued service agreement and agree to serve a period equal to at

least three times the length of the sabbatical.

2. Degree Training

Degree training is an essential component of an organization that

requires continuous acquisition of advanced and specialized knowledge.

Degree training in the academic environment of DoD laboratories is also

a critical tool for recruiting and retaining employees with or

requiring critical skills. Constraints under current law and regulation

limit degree payment to shortage occupations. In addition, current

government-wide regulations authorize payment for degrees based only on

recruitment or retention needs. Degree payment is currently not

permitted for non-shortage occupations involving critical skills.

Under the Personnel Demonstration Project, WES will expand the

authority to provide degree training for purposes of meeting critical

skill requirements, to ensure continuous acquisition of advanced and

specialized knowledge essential to the organization, and to recruit and

retain personnel critical to the present and future requirements of the

organization. It is expected that the degree payment authority will be

used primarily for attainment of advanced degrees.

G. Reduction in Pay or Removal Actions

Employees covered by the project will be evaluated under a

performance evaluation system that affords grievance and/or appeal

rights the same as those provided currently.

1. Unacceptable Performance

An employee whose performance is unacceptable (i.e.,who does not

perform at the acceptable level described by the standards for a

particular critical element, and whose performance thus warrants a

performance score of 0 on that element) at any time during the year

shall be placed in a Performance Improvement Plan (PIP). If an employee

is in a PIP at the end of a rating period, the performance rating will

be delayed until the end of the PIP. Any General Schedule increase will

be based on the rating at the end of the PIP. If performance remains

unsatisfactory upon completion of the PIP, the employee will be

separated from his or

[[Page 10477]]

her position or reduced to a lower pay band. If performance becomes

satisfactory, the employee will receive a performance rating of record

and appropriate adjustments to pay may be made at that time (i.e.,

granting General Schedule increase). These performance-based actions

will follow the same procedures as current performance-related removals

and reductions in grade under Chapter 43 or Chapter 75 when

appropriate.

2. Placement in a Lower Pay Band

An employee with an average performance score of less than 2.0 is

ineligible for a performance pay increase or performance award and may

receive either none or one-half the General Schedule pay increase.

Because the minimum pay rate for each pay band will be increased each

year by the amount of the General Schedule increase, it is possible

that the new minimum rate of a pay band will exceed the basic pay of an

employee in that band who did not receive the full General Schedule

increase. In these cases, the employee will be moved to the next lower

band level. This will not be considered an adverse action, will not be

appealable through a statutory appeals process, and will not be covered

under grade retention provisions.

H. Revised Reduction in Force (RIF) Procedures

Modifications include limiting competitive areas to occupational

families and increasing the emphasis on performance in the RIF process.

These modifications will increase the probability of retaining the

highest performing individuals in their positions and will increase the

probability of displacing the lowest performing individuals.

1. Competitive Areas

For RIF purposes, the competitive area will be the occupational

family in which the employee is assigned and will cover all geographic

locations.

2. Retention

Retention registers will be established based on the following

criteria listed in order of priority: Tenure status (Tenure I-career,

Tenure II-career conditional, Tenure III-modified term); veteran's

preference; most recent employee performance score; and service

computation date. Modified term employees within the affected

occupational family will be separated before permanent Tenure I and II

employees. The present RIF system essentially remains in effect, except

that performance scores are part of the retention order. Performance

scores will not be used to adjust the service computation date. The

service computation date will be used as a tie breaker. A preference

eligible with a compensable service-connected disability of 30 percent

or more may displace employees in positions equivalent to 5 GS grades

below the minimum grade level of his/her current pay band. Other

employees may displace employees in positions no more than two pay band

levels below the minimum level of his/her current pay band. Increasing

the emphasis on job performance will help ensure the retention of

outstanding individuals in RIF situations.

In some cases, an employee may not have a performance score of

record. In these situations, a modal performance score will be

assigned.

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

to a lower pay band competes in a RIF from the position to which he/she

has been demoted. Employees who have been demoted for unacceptable

performance or conduct, and as of the date of issuance of the RIF

notice have not received a performance score in the position to which

demoted, will receive a modal performance score.

An employee who has received an improved performance score

following a PIP will have the improved performance score considered as

the current performance score of record, provided that notification of

such improvement is approved and received prior to the cutoff for

receipt of personnel actions associated with implementation of RIF

mechanics.

An employee with a current rating of unsatisfactory has assignment

rights only to a position held by another employee who has a rating of

unsatisfactory. An employee who has been given a written decision of

removal will not compete in the RIF process.

Modified term appointment 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.

3. 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.

IV. Training

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 all participants. Training will be tailored to fit the

requirements of every employee included in the project and will fully

address employee concerns to ensure that everyone has a comprehensive

understanding of the program.

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 the following: A description of the system; how

employees are converted into the system; pay adjustment process;

familiarization with the new position descriptions and performance

objectives; the individual performance rating process; the

reconsideration process; and the demonstration project administrative

and formal evaluation process.

A. 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 managers 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, skills training in using the classification system, position

description preparation, and performance evaluation. Additional

training may focus on nonproject procedural techniques such as

interpersonal and communication skills.

B. Administrative Staff

The administrative staff, generally personnel specialists,

technicians, and administrative officers, 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.

C. Employees

WES will 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

[[Page 10478]]

of all project decisions, procedures, and processes.

V. Conversion

A. Conversion to the Demonstration Project

Initial entry into the demonstration project for covered employees

will be accomplished through a full employee protection approach that

ensures each employee an initial place in the appropriate occupational

family and pay band without loss of pay. An automatic conversion from

current GS/GM grade and pay into the new broadbanding system will be

accomplished.

Special conversion rules will apply to special rate employees (see

Section III, D, Pay Setting Provisions). Employees who enter the

demonstration project later by lateral reassignment or transfer will be

subject to the same pay conversion rules. Employees serving under

regular term appointments at the time of project implementation will be

converted to the modified term appointment. Position announcements,

etc., will not be required for these term appointments. If conversion

into the demonstration project is accompanied by a geographic move, the

employee's GS pay entitlements in the new geographic area must be

determined before performing the pay conversion.

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 WES. In no case may those

adjustments increase the pay for the position of record beyond the

maximum pay rate for the applicable pay band. 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.

At the time of conversion, each employee will have their basic pay

adjusted for the time credited (in weeks) toward what would have been

the employee's next within-grade increase. This adjustment in basic pay

is applicable when employees are converted into the project.

Any employee covered by the project that is located at a permanent

duty station Outside the Continental United States will continue to be

ineligible for locality pay. Except for the maximum rate of basic pay

for pay band VI, which will be limited to rate of basic pay for SES

level 4, the maximum basic salary payable in the pay band will be

limited to the maximum rate of pay on the GS salary table which does

not include any locality pay.

B. Conversion From the Demonstration Project

If a demonstration project employee is moving to a 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 rate of pay to GS

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

will become the employee's actual GS grade and rates of pay after

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

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

rates of pay will be used in applying any GS pay/administration rules

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

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

retention rules) as if the GS converted grade and rates of pay were

actually in effect immediately before the employee left the

demonstration project.

1. 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 or staffing

supplement but excluding any supervisory pay adjustment) is compared

with step 4 rates in the highest applicable GS rate range. For this

purpose, a ``GS rate range'' includes a rate range in the GS base

schedule, the locality rate schedule for the locality pay area in which

the position is located, or 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 of pay is lower than

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

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

employee's pay band. If the employee's adjusted rate of pay 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 of pay 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 of pay 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 of pay

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 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.

2. Pay-Setting Provisions

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

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

rates 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 or staffing supplement but excluding

any supervisory pay adjustment) is

[[Page 10479]]

converted to a GS adjusted rate of pay on the highest applicable GS

rate range for the converted GS grade. For this purpose, a ``GS rate

range'' includes a rate range in the GS base schedule, an applicable

locality rate schedule, or 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 of pay is converted to a GS

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

locality-adjusted schedule, the rate of pay must be set at the higher

step. The converted 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).

3. Engineers and Scientists Pay Band VI Employees

Employees in pay band VI of the Engineers and Scientists

occupational family will convert out of the demonstration project at

the GS-15 level. WES will develop a procedure to ensure that employees

entering pay band VI 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 VI

employees paid below the adjusted GS-15, step 10 rate, the converted

rates will be set in accordance with paragraph 2 above.

4. Employees With Band or Pay Retention

(a) If an employee is retaining a pay band level under the

demonstration project, apply the procedures in paragraphs 1 and 2,

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.

(b) If an employee is retaining rate under the demonstration

project, the employee's GS equivalent grade is the highest grade

encompassed in his or her band level. WES 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.

5. Within-Grade Increase--Equivalent Increase Determinations

Service under the demonstration project since the last pay-for-

performance determination 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).

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 the 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: permanent implementation; change and another 3-5

year test period; or expiration.

VII. Evaluation Plan

Authorizing legislation mandated evaluation of the demonstration

project to assess the merits of project outcomes and to evaluate the

feasibility of applications to other federal organizations. A

comprehensive and methodologically rigorous evaluation of the personnel

system changes will be carried out. The overall evaluation consists of

two components--external and internal evaluation. The external

evaluation will be conducted by OPM's Personnel Resources and

Development Center (PRDC) to benefit from their extensive experience

evaluating demonstration projects. PRDC will serve in the role of

external evaluator to ensure the integrity of the evaluation process,

outcomes, and interpretation of results. Their external evaluation will

be supplemented by an internal evaluation to be accomplished by the

staff of WES. Selected parts of the evaluation will be completed using

contractor support. The contractor(s) will be well qualified and

experienced with demonstrated expertise in performing relevant support

functions.

Essential elements of the evaluation plan are set forth below. The

demonstration project is a complex experiment to be conducted in a

dynamic environment over several years. Modifications and refinements

to the evaluation plan will be made as required by mid-course project

changes. All additions, deletions, and refinements to the current plan

will be fully documented and explained as part of the evaluation

reporting process. The main purpose of the evaluation is to determine

the effectiveness of the personnel system changes described by the

individual interventions. Every effort will be made to establish direct

cause-and-effect relationships between the interventions and

effectiveness criteria. An ancillary objective is to assess the effects

of the interventions on improved organizational performance. An

indirect causal link is hypothesized between the personnel system

changes and improved organizational effectiveness, i.e., improved

laboratory performance, mission accomplishment, and customer

satisfaction. The current personnel management system with its many

rigid rules and regulations often is perceived as a barrier to mission

accomplishment. Together, the demonstration project initiatives are

intended to remove some of those barriers, and therefore, are expected

to contribute to improved laboratory performance.

The evaluation effort will be accomplished in four distinct phases:

(a) Design phase--includes development of the evaluation model,

selection of experimental and comparison sites, and collection of

baseline data prior to implementation.

(b) Implementation phase--includes actual project implementation

and monitoring of the degree and support of implementation to assure

that each of the project interventions has been operationalized as

originally conceived.

(c) Formative evaluation phase--includes data collection and

analysis for five years for purposes of evaluating the effects of the

interventions. Periodic reports and annual summaries will be prepared

to document the findings.

(d) Summative evaluation phase--focuses on summary evaluation and

overall assessment of the project's impact, including presentation of

conclusions and final recommendations upon completion of the project.

An intervention impact model (Appendix A) will be used to measure

[[Page 10480]]

the effectiveness of the various personnel system changes or

interventions. Additional measures will be developed as new

interventions are introduced or existing interventions modified with

consistent with expected effects. Measures may also be deleted when

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 on context variables that are likely to have an impact on

project outcomes (e.g., HRM regionalization, downsizing, 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:

workforce data; personnel office data; employee attitudes and feedback

using surveys, structured interviews and focus groups; local activity

histories, and core measures of laboratory effectiveness.

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 WES budget. The

projected annual expenses for each area is summarized in Table 4.

Table 4.--Projected Developmental Costs

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

FY 96 FY 97 FY 98 FY 99 FY 00 FY 01

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

Training...................................... ......... $97K $19K ......... ......... .........

Project Evaluation............................ $25K 60K 60K $60K $60K $60K

Automation.................................... 80K 10K ......... ......... ......... .........

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

Totals.................................... 105K 167K 79K 60K 60K 60K

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

IX. Required Waivers to Law and Regulations

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.

A. Waivers to Title 5, U.S. Code

Section 3111, Acceptance of volunteer service.

Section 3132, The Senior Executive Service; definitions and

exclusions.

Section 3324, Appointments to positions classified above GS-15.

Section 3341, Details (to the extent that non-competitive details

to higher band levels can now be 180 days rather than 120).

Section 4107, Non-Government facilities; restrictions (to the

extent that training may be paid for the purpose of an employee to

obtain a degree).

Section 4108, Employee agreements; service after training (to the

extent that continued service is required only for long-term training

and sabbaticals).

Section 4303(f), Actions based on unacceptable performance (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).

Sections 5101-5111, Purpose, definitions, basis, classification of

positions, review, authority (to the extent that white collar employees

will be covered by broadbanding. Pay category determination criteria

for Federal Wage System positions remain unchanged).

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 basic pay;

and (3) employees in band VI of the Engineers and Scientists

occupational family to be treated as ST employees for the purposes of

these provisions).

Section 5305, Special pay authority.

Sections 5331-5336, General Schedule pay rates.

Sections 5361-5366, Grade and pay retention (to the extent

necessary to (1) replace ``grade'' with ``pay band'; (2) allow

demonstration project employees to be treated as General Schedule; (3)

provide that pay band retention provisions do not apply to movements to

a lower pay band as a result of receiving no or only part of a general

pay increase because of poor performance; (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, and to reductions in pay due solely to the removal of all or

part of a supervisory pay adjustment upon leaving a supervisory

position; (5) provide that an employee on pay retention whose

performance rating is less than 2.0 is not entitled 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; and (6) ensure that for

employees of pay band VI of the Engineers and Scientists 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 retained rate).

Section 5545, Night, standby, irregular, and hazardous duty

differential (to the extent necessary to allow demonstration project

employees to be treated as General Schedule employees. This waiver does

not apply to employees in band VI of the Engineers and Scientists

occupational family).

[[Page 10481]]

Sections 5753, 5754, and 5755, Recruitment and relocation bonuses,

retention allowances, and supervisory differentials (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 band VI of the Engineers and Scientists

occupational family to be treated as ST employees).

Section 7512(3), Adverse actions (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 adverse

action).

Section 7512(4), Adverse actions (to the extent necessary to

provide that adverse action provisions do not apply to: (1) Conversions

from General Schedule special rates to demonstration project pay, as

long as total pay is not reduced; and (2) reductions in pay due to

removal of all or part of a supervisory adjustment).

B. Waivers to Title 5, Code of Federal Regulations

Part 300.601-605, Time-in-grade restrictions (to the extent that

time-in-grade restrictions are eliminated).

Part 308.101-103, Volunteer service (to the extent that volunteer

service is unrestricted).

Parts 315.801(a) and 315.802(a), Length of probationary period (to

the extent that the probationary period for engineers and scientists is

increased to 2 years).

Part 316.301, Term appointment (to the extent that modified term

appointments may cover a maximum period of 6 years).

Part 316.303, Tenure of term employees (to the extent that term

employees may compete for permanent status through local merit

promotion plans).

Part 316.305, Eligibility for within grade increases.

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, Retention standing, credit for performance (to the

extent that service credit will not be modified based on performance

rating).

Part 351.701, Assignment involving displacement (to the extent that

a performance score of 1 is substituted for level 2 and bumping and

retreating will be limited to no more than 2 pay bands except for 30

percent compensable veterans who can retreat to the equivalent of 5 GS

grades).

Part 410.308, Training to obtain an academic degree.

Part 410.309, Agreements to continue in service. (To the extent

necessary that individuals pursuing academic degrees do not sign

service agreements.)

Part 430.204, Definition of rating of record (to the extent

necessary to allow ratings of record that do not cover performance over

the entire appraisal period).

Part 430.208(d), Summary levels (to the extent necessary to allow

use of summary performance scores that are not further categorized into

five or fewer summary levels).

Part 432.104-105, Performance based reduction in grade and removal

actions (to the extent that ``pay band'' is substituted for ``grade''

and reduction in band level as a result of non-receipt of General

Schedule increases because of poor performance is not an adverse

action.

Part 511.101, 201-203, General provisions and coverage of the

General Schedule (to the extent that positions are covered by

broadbanding).

Part 511.601-612, Classification appeals (to the extent that

positions are covered by broadbanding).

Part 530, subpart C, Special salary rates.

Part 531, subparts B, D, and E, Determining the rate of basic pay,

within-grade increases, and quality step increases.

Part 531, subpart F, Locality-based comparability payments (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 band VI of the Engineer and Scientist occupational

family to be treated as ST employees).

Part 536, Grade and pay retention (to the extent necessary to: (1)

Replace ``grade'' with ``pay band''; (2) provide that pay band

retention provisions do not apply to movements to a lower pay band as a

result of receiving no or only part of a general pay increase because

of poor performance; (3) 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, and to

reductions in pay due solely to the removal of all or part of a

supervisory pay adjustment upon leaving a supervisory position; (4)

provide than an employee on pay retention whose performance rating is

less than 2.0 is not entitled 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 and (5) ensure that for employees in pay band

VI of the Engineers and Scientists 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

retained rate).

Part 550.703, Severance pay (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, definition of

``employee'' (to the extent necessary to allow demonstration project

employees to be treated as General Schedule employees. This waiver does

not apply to employees in band VI of the Engineers and Scientists

occupational family).

Part 575, subparts A, B, C, and D, Recruitment bonuses, relocation

bonuses, retention allowances and supervisory differentials (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 band VI 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 provision is waived only

to the extent necessary to (1) substitute ``pay band'' for ``grade''

and (2) provide that moving 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 adverse action.

Part 752.401 (a)(4), Adverse actions (to the extent necessary to

provide that adverse action provisions do not apply to: (1) Conversions

from General Schedule special rates to demonstration project pay, as

long as total pay is not reduced; and (2) reductions in pay due to the

removal of all or part of a supervisory adjustment).

[[Page 10482]]

Appendix A--Intervention Impact Model: Project Evaluation

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Intervention Expected effects Measures Data sources

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1. Broadbanding:

a. Pay Bands................ --Less difficulty and --Perceptions of --Focus groups.

less time spent on difficulty and time --Attitude survey.

classification. spent on classification --Personnel activity

activities by managers reports.

and personnelists.

--Increased understanding --Perceptions of --Focus groups.

with the classification satisfaction with --Attitude survey.

results under the new classification process.

system.

b. Occupational Families..... --Increased satisfaction --Perceptions of --Focus groups.

with advancement satisfaction with --Attitude survey.

potential. career path process and

progression.

--Increase in management --Perception of --Attitude survey.

authority. authority.

c. Conversion of Employees to --Employee acceptance.... --Perception of equity --Attitude survey.

the Demonstration Project. and fairness.

2. Classification:

a. Classification Standards.. --Less difficulty and --Perceptions of --Focus groups.

less time spent on difficulty and time --Attitude survey.

classification; less spent on classification --Personnel activity

difficulty classifying activities by managers reports.

jobs. and personnelists.

--Increased satisfaction --Perceptions of --Focus groups.

with the classification satisfaction with --Attitude survey.

results under the new classification process.

system.

b. Position Descriptions and --Less difficulty and --Perceptions of --Focus groups.

Classification Process. less time spent on difficulty and time --Attitude survey.

classification by spent on classification --Personnel activity

managers. activities by managers reports.

and personnelists.

--Fewer position --Reduced time to --Attitude survey.

descriptions. develop position --Personnel activity

descriptions. reports.

--Increased satisfaction --Perceptions of --Focus groups.

with the classification satisfaction with --Attitude survey.

results under the new classification process.

system.

--Development of generic --Implementation of --Personnel activity

classification standards. generic standards. reports.

3. Pay for Performance:

a. Supervisory Pay --Reward top performers --Attitudes of --WES workforce data.

Adjustments and who take supervisory and supervisors and --Attitude survey.

Differentials. managerial assignments. managers with pay.

b. Promotion Link............ --Promotions based on --Probability of --WES workforce data.

individual's performance. promotion for high --Attitude survey.

performers.

c. Link Between Performance --Stronger link between --Pay for performance --WES workforce data.

and Pay. performance and pay. correlations. --Attitude survey.

--Perception of pay for

performance link.

--Improve retention of --Employee perception of --Attitude survey.

high performers. equality.

--Increase turnover among --Turnover rates by --WES workforce data.

low performers. performance over time.

--Increase in supervisory --Supervisors perception --Attitude survey.

decision making of pay for performance

authority accountability. link.

--Increase pay --Employees perception --Attitude survey.

satisfaction. of pay for performance

link.

d. Awards.................... --Reward/motivate --Perceived motivational --Attitude survey.

performance. power.

--To support fair and --Amount and number of --WES workforce data.

appropriate distribution awards by occupational

of awards. family, demographics.

--Perceived fairness of --Attitude survey.

awards.

--Satisfaction with --Attitude survey.

monetary awards.

4. Hiring and Placement:

a. Hiring Authority.......... --Reduction in time to --Time lag from --WES workforce data

hire. announcement to date. hiring log.

--Improve rate of job --Offer acceptance rate. --WES workforce data

offers/acceptance. hiring log.

--Improve image as --Offer acceptance rate. --Managers' and

interested caring supervisors' documented

employer. experience.

b. Modified Term Appointments --Decrease in hiring --Better qualified --WES workforce data.

authorities. candidates within the

temporary workforce.

c. Extended Probationary --Provide managers time --Managers perception of --Attitude survey.

Period. to accurately identify new hires success.

successful employees.

[[Page 10483]]

--New hires performance --WES workforce data.

ratings.

--Increase in length of --Pre and post --WES workforce data.

probation for engineers comparison of length of

and scientists. probation.

--Increase in voluntary --Comparison of --WES workforce data.

(in lieu of adverse voluntary/involuntary

action) and involuntary turnover rates for low

turnover of low performers during

performers during probation period.

probation.

5. Employee Development:

a. Sabbaticals............... --Increase development of --Perception of fairness --Attitude survey.

employees. in career development. --Documented experience

--Use of sabbaticals for of managers and

career development. supervisors.

b. Degree Training........... --Increase development of --Perception of fairness --Attitude survey.

employees. in career development.

6. Reduction-In-Force:

Modified RIF................. --Retention of high --Evaluation rating vs --WES workforce data.

performers. RIF turnover. --Historical WES data.

--Historical RIF data

from other Army

Laboratories.

--Reduce disruption to --Attitudes on a RIF --Attitude survey.

the workforce by action.

limiting RIF to

occupational family.

7. 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. satisfaction.

--Improved planning...... --Planning procedures... --Strategic planning

documents.

--Improved cross --Perceived --Organizational charts.

functional coordination. effectiveness of

planning procedures.

--Actual perceived

coordination.

--Increased product --Customer satisfaction. --Attitude survey.

success. --Customer satisfaction

surveys.

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[FR Doc. 98-5425 Filed 3-2-98; 8:45 am]

BILLING CODE 6325-01-P