Time-In-Grade Rule Eliminated

Proposed Rules

Federal Register

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Proposed Rules

OFFICE OF PERSONNEL MANAGEMENT

5 CFR Part 300

RIN 3206-AG06

Time-In-Grade Rule Eliminated

AGENCY: Office of Personnel Management.

ACTION: Extension of public comment period on proposed elimination of

time-in-grade rule.

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SUMMARY: On June 15, 1994, the Office of Personnel Management (OPM)

proposed regulations to abolish the time-in-grade restriction on

promotion of Federal employees to positions in the General Schedule.

The National Performance Review and National Partnership Council had

recommended the elimination of the 1-year Federal service requirement

for promotions because it prevents employees from applying for jobs for

which the qualify.

To ensure that the public has ample opportunity to fully review and

comment on the proposed rulemaking, this notice extends the public

comment period for an additional 60 days.

DATES: Comments must be submitted on or before March 13, 1995.

ADDRESSES: Send or deliver written comments to Leonard R. Klein,

Associate Director for Career Entry, Office of Personnel Management,

Room 6F08, 1900 E Street, NW., Washington, DC 20415.

FOR FURTHER INFORMATION CONTACT: Lee Shelkey Edwards on 202-606-0830,

TDD 202-606-0023, or FAX 202-606-2329.

SUPPLEMENTARY INFORMATION:

A. Background

Comments must be submitted on or before March 13, 1995.

ADDRESSES: Send or deliver written comments to Leonard R. Klein,

Associate Director for Career Entry, Office of Personnel Management,

Room 6F08, 1900 E Street, NW., Washington, DC 20415.

FOR FURTHER INFORMATION CONTACT: Lee Shelkey Edwards on 202-606-0830,

TDD 202-606-0023, or FAX 202-606-2329.

SUPPLEMENTARY INFORMATION:

A. Background

Since the early 1950's, Federal employees in General Schedule

positions at GS-5 and above have had to serve at least 1 year in grade

before being promoted. This restriction originated in statute with the

now expired ``Whitten Amendment,'' a series of controls on expansion of

the Federal work force during the Korean conflict. The time-in-grade

restriction currently is in 5 CFR part 300, subpart F. Prior to the

Whitten Amendment, no such regulatory restriction existed.

The National Performance Review recommended abolishing the time-in-

grade restriction because it prevents employees from being considered

for jobs for which they qualify. On June 15, 1994, OPM proposed

regulations (59 FR 30717) to abolish the time-in-grade restriction. We

received 241 written comments; 30 agreed with the proposal (22

individuals and 8 agencies) and 211 disagreed with it (197 individuals,

5 employee unions, 2 agencies, and 7 other organizations).

Comments from individuals include 189 form letters expressing

serious concern that the proposal would have an adverse impact on

minority and disabled employees. Others also commented that the

elimination of time in grade could lead to favoritism and inequity in

promotions, and promoted employees would not be qualified. A majority

of commenters who opposed the proposal requested an extension of the

comment period.

As requested, OPM is extending the comment period to allow

additional time to examine the proposal. We are also using this notice

to provide additional information on the background of the time-in-

grade restriction and the impact of its elimination.

by the Civil Service Commission to determine whether any of its

provisions, including time-in-grade, should be retained. The Commission

reported that the time-in-grade restriction on competitive service

employees had been placed in regulation and would continue even if the

Whitten Amendment expired. Subsequently, Congress permitted the Whitten

Amendment to expire effective September 14, 1978. Since then,

competitive service employees, but not excepted employees, have

continued to be subject to the Governmentwide time-in-grade

restriction, although individual agencies could at their discretion

require it for excepted employees.

Over the 16 years since its expiration, much has happened in

Federal personnel administration. The civil service has been subject to

numerous reviews, and several reports, most recently from the National

Performance Review, have recommended deregulation and simplification of

the hiring system. The time-in-grade rule is often seen as a symbol of

bureaucratic red tape that binds managers hands and prevents the

efficient use of qualified workers.

C. NPR Proposal

In its September 1993 report From Red Tape to Results: Creating a

Government That Works Better & Costs Less, the National Performance

Review (NPR) recommended abolishing the time in-grade requirement as an

arbitrary limit on competition. The requirement excludes from

consideration those candidates who meet OPM qualification standards and

have the proven ability to perform the duties of higher grade

positions, but who have not served at least one year in lower graded

Government positions. See pages 11 and 15 of Reinventing Human

Resources Management, Accompanying Report of the National Performance

Review.

The National Partnership Council, established by Executive Order

12871 of October 1, 1993, was charged with developing legislative

proposals for the President to implement the NPR recommendations. The

Council's report also recommended abolishing the time-in-

grade restriction

ee pages 11 and 15 of Reinventing Human

Resources Management, Accompanying Report of the National Performance

Review.

The National Partnership Council, established by Executive Order

12871 of October 1, 1993, was charged with developing legislative

proposals for the President to implement the NPR recommendations. The

Council's report also recommended abolishing the time-in-

grade restriction. In A Report to the President on Implementing

Recommendations of the National Performance Review by the National

Partnership Council, January 1994, the Council states on page 30:

``The NPC recommends the following * * * regulatory changes be made

to allow employees to compete for job opportunities based on their

qualifications and to enable decision makers to utilize employees more

fully where needed--

Abolish the time-in-grade regulatory requirement. For

bargaining unit employees, the current requirement should remain in

effect until the parties agree to modify it either through consensus or

collective bargaining.''

Thus, OPM's proposal is consistent with recommendations of both the

NPR and National Partnership Council.

D. Impact of Proposal

Shrinking Federal Work Force

When Congress passed the Whitten Amendment in the 1950's, the civil

service was expanding to respond to the needs of the growing conflict

in Korea. Time in grade was a brake on that expansion.

The situation today is just the opposite. The Federal Workforce

Restructuring Act of 1994, Pub. L. 103-226 of March 30, 1994, mandates

reductions in Federal employment levels. Employment in executive

agencies is to be reduced in each fiscal year from FY 94 through FY 99

by a total of 272,900 positions. Also, the level of agency funding is

being reduced because of deficit reduction legislation.

The results is that managers must do more with fewer employees and

less money. Managers cannot inflate grade levels because their funds

and position authorizations will be tight

oyment in executive

agencies is to be reduced in each fiscal year from FY 94 through FY 99

by a total of 272,900 positions. Also, the level of agency funding is

being reduced because of deficit reduction legislation.

The results is that managers must do more with fewer employees and

less money. Managers cannot inflate grade levels because their funds

and position authorizations will be tight. And, since agencies are

being asked to do more with less, the quality of the work force has

become even more important. It makes more sense for managers to be able

to select from among the best-qualified employees available, regardless

of their existing grade levels.

Another effect of the shrinking work force is fewer opportunities

for employee advancement. Agencies traditionally encourage employees to

improve their capabilities. Employees who have acquired new skills and

knowledge--many on their own time and with their own resources--will

find far fewer vacancies available. The time-in-grade restriction is

just one more obstacle to prevent them from competing to use the new

skills they have worked hard to acquire, even though they meet OPM

qualification standards.

Coverage

Not all Federal employees are subject to the restriction. The

Whitten Amendment applied to both competitive and excepted employees in

GS positions. However, when the law expired in 1978, excepted employees

were released from its coverage because OPM's time-in-grade regulations

apply only to the competitive service. Other competitive service

employees under other pay plans, such as the wage grade system, also

are free of the restriction. Yet the lack of a time-in-grade

restriction has had no discernible adverse effect on these excepted and

wage grade positions. OPM's proposal would put competitive service

employees on an equal footing by allowing them to compete for

advancement based on their qualifications just as these other employees

do.

Qualifications

ans, such as the wage grade system, also

are free of the restriction. Yet the lack of a time-in-grade

restriction has had no discernible adverse effect on these excepted and

wage grade positions. OPM's proposal would put competitive service

employees on an equal footing by allowing them to compete for

advancement based on their qualifications just as these other employees

do.

Qualifications

Many of the commenters who disagreed with the proposal believed

that its abolishment would result in the promotion of employees who are

not qualified for their jobs. This is not true. When the time-in-grade

restriction was implemented in the 1950's, no effective means existed

to prevent employees from advancing rapidly through the grades. But

there is now in place a comprehensive qualification standards system

covering all General Schedule positions in the competitive service.

To qualify for most positions, an individual must have 1 year of

specialized experience equivalent in difficulty to the next lower grade

level, or equivalent education. Even without the time-in-grade

restriction, individuals must meet this specialized experience or

education requirement. Thus, this proposal would not result in the

hiring of unqualified persons. Nor would this proposal allow persons to

be placed in a higher grade position merely because of their

``potential'' and without the necessary qualifying background. In fact,

the only employees who could be promoted in less than 1 year are those

who have higher level experience from another job or qualifying

education.

Abolishment of time in grade simply means that employees may be

considered for any grade for which they meet the qualification

requirements, either through education or experience acquired in

Federal or any other work settings. Employees may compete in civil

service examinations without regard to time in grade, and this proposal

would enable them also to compete under internal merit promotion

procedures based on qualifications

means that employees may be

considered for any grade for which they meet the qualification

requirements, either through education or experience acquired in

Federal or any other work settings. Employees may compete in civil

service examinations without regard to time in grade, and this proposal

would enable them also to compete under internal merit promotion

procedures based on qualifications.

The time-in-grade restriction prevents that consideration, as with

individuals who take lower graded jobs when nothing else is available

and then find they are not allowed to apply for higher graded jobs for

which they are well qualified. Letters from individuals supporting the

proposed elimination provide other representative examples of how time

in grade inhibits employee advancement:

--An employee pursued Bachelors and Masters degrees while balancing

time as a student, mother, and Federal clerical employee in

positions up to GS-5, yet time in grade prevents her from competing

for the GS-9 professional positions for which she now qualifies.

--An employee whose agency has had a longstanding hiring freeze has

been detailed to a higher grade position for more than 1 year.

Although the employee is now qualified for a position two grades

higher, he meets time in grade only for positions one grade higher.

--A minority employee entered Government employment as a GS-9.

Despite two Masters degrees, a year and a half of law school, 10

years experience in executive positions at a private corporation,

service as adjunct instructor at a major university, and other

substantive experience, he was restricted by time in grade from

applying for managerial positions for which he qualified.

--A co-op student accepted a GS-4 clerical job when her agency

terminated its trainee program. Most jobs in her field start at GS-

7, for which she qualifies, but she is eligible only for GS-5

because of time in grade and will have to pursue a different line of

work

other

substantive experience, he was restricted by time in grade from

applying for managerial positions for which he qualified.

--A co-op student accepted a GS-4 clerical job when her agency

terminated its trainee program. Most jobs in her field start at GS-

7, for which she qualifies, but she is eligible only for GS-5

because of time in grade and will have to pursue a different line of

work.

--A retired military member with a degree and over 20 years of

experience took a Federal wage grade position. A debilitating

accident required him to accept a GS-4 position, and now time in

grade prevents him from applying for positions consistent with his

experience.

Impact on Minorities

Individual commenters and organizations representing minority

employees were concerned that eliminating time in grade would lead to

abuse and favoritism, with a negative impact on affirmative action and

equal employment opportunity. OPM does not believe that retention of

time in grade contributes to equality in the work place. Although

abolishing the restriction will not eliminate the ``glass ceiling,'' it

would be one more step toward eliminating artificial barriers to

employees advancement for minorities and nonminorities alike.

Promotions

Even without time in grade, agencies must continue to assure that

employees meet Governmentwide qualification standards to

be eligible for promotion, both competitive actions under the merit

promotion program and noncompetitive actions such as career ladder

promotions. Agencies also must continue to evaluate the relative

qualifications of candidates to determine the best-qualified applicants

under a competitive promotion action. Therefore, it is not necessary

for an agency to have any additional processes or systems in place

before implementing the abolishment of time in grade.

Many commenters focused on the impact of the proposal on career

ladder promotions

encies also must continue to evaluate the relative

qualifications of candidates to determine the best-qualified applicants

under a competitive promotion action. Therefore, it is not necessary

for an agency to have any additional processes or systems in place

before implementing the abolishment of time in grade.

Many commenters focused on the impact of the proposal on career

ladder promotions. Several thought employees in career ladders would

expect rapid advancement without time in grade and that managers could

be pressured into making rapid promotions. Again, we must stress that

career ladder promotions require an individual to have 1 year of

specialized experience equivalent in difficulty to the next lower grade

level or possess equivalent education.

Furthermore, agencies have the discretion to specify requirements

employees must meet for career ladder promotions, and many have done

so. Such requirements include, for example, the level of performance to

be met, the range of skills to be acquired, a finding that higher level

duties exist, and the availability of funds. Elimination of time in

grade will enable agencies to dispel the idea that promotion

automatically follows a period of time in grade and instead concentrate

on qualifications and the level of performance that is need for the

next higher level.

One employee union suggested that OPM consider whether to limit the

number of grades an employee could be promoted in a year. The current

regulation has such limits only on promotions up to GS-5 because

employees in grades GS-1 through GS-4 are not subject to the year in

grade requirement. OPM believes grade limits are not needed because

they too are arbitrary and disregard employee qualifications.

One employee union felt it would normally disrupt the work place to

a great degree if a lower graded employee were promoted over higher

graded employees

mits only on promotions up to GS-5 because

employees in grades GS-1 through GS-4 are not subject to the year in

grade requirement. OPM believes grade limits are not needed because

they too are arbitrary and disregard employee qualifications.

One employee union felt it would normally disrupt the work place to

a great degree if a lower graded employee were promoted over higher

graded employees. The union believes this should occur only when there

is a specific, identifiable, business-related reason which the agency

documents in writing. OPM's view is that managers must be prepared to

deal with the impact of selection decisions, such as when selecting an

individual from outside an immediate unit instead of an eligible

employee within the unit. The manager decide which qualified employee

is best able to carry out the duties of the position and must weigh

various effects of different options. Abolishment of time in grade

would not alter this responsibility.

Several commenters suggested managers hire workers at the grade

needed instead of, for example, hiring at the GS-5 level and later

promoting the employee to a GS-9. However, there may be instances where

a manager hires an employee at a lower level to save money or because

the manager feels the individual is not ready for the higher level. If

the funding level changes or the employee demonstrates good work, the

manager might want to promote the employee is less than 1 year. In

neither of these cases is there a merit system violation, and our

proposal would allow these employees to advance.

Violations

hires an employee at a lower level to save money or because

the manager feels the individual is not ready for the higher level. If

the funding level changes or the employee demonstrates good work, the

manager might want to promote the employee is less than 1 year. In

neither of these cases is there a merit system violation, and our

proposal would allow these employees to advance.

Violations

Some individuals, for personal reasons, must accept jobs lower than

their highest skill level and later will seek higher grade jobs.

However, it would be improper for an agency to hire someone at a lower

grade to avoid proper appointing procedures and then promote the

individual to the desired grade. For example, it would be improper to

appoint an individual to a clerical job because he or she is not

``within reach'' for appointment to a professional job, and then

promptly promote the person to the professional job. To prevent this, 5

CFR 330.501 prohibits the promotion of an employee within 90 days of a

new competitive appointment. OPM continues to enforce violations of

that provision and, in the absence of a time-in-grade rule, would

closely monitor agency actions for potential violations.

Other protections against potential abuse are the statutory merit

principles and prohibited personnel practices (5 U.S.C. 2301 and 2302)

in place since January 1979. For example, it is a prohibited personnel

practice for an agency official to grant any preference or advantage

not authorized by law, rule, or regulation to any employee or applicant

for the purpose of improving or injuring the prospects of any

particular person for employment (5 U.S.C. 2302(b)(6)). These statutory

provisions did not exist when the Whitten Amendment expired in 1978.

Alleged violations may be pursued through the independent Office of

Special Counsel, which is responsible for investigating allegations of

prohibited personnel practices and initiating corrective or

disciplinary action where warranted.

Training Agreements

rticular person for employment (5 U.S.C. 2302(b)(6)). These statutory

provisions did not exist when the Whitten Amendment expired in 1978.

Alleged violations may be pursued through the independent Office of

Special Counsel, which is responsible for investigating allegations of

prohibited personnel practices and initiating corrective or

disciplinary action where warranted.

Training Agreements

Agencies have long had the authority to establish training

agreements under which employees acquire qualifications at a faster

than normal rate. This proposal will have no impact on agencies'

continued use of training agreements. However, with abolishment of time

in grade, agencies no longer will need to obtain OPM approval of

training agreements that contain waivers of time in grade.

Training agreements are traditionally used for critical shortage

occupations at the entry level. These programs provide a valuable

recruitment incentive in filling positions where qualified applicants

are in extremely short supply.

E. Waivers

Several commenters recommended the time-in-grade restriction be

retained with authority to waive it in inequitable or hardship

situations or to promote an outstanding employee. Agencies currently

have waiver authority in inequitable or hardship situations. The

problem with this approach is that an employee is dependent on agency

management to seek a waiver when management needs it. Our proposed

elimination of the restriction would free employees to seek other

opportunities, in any agency, without being dependent on management's

waiver action. Also, because of the restriction, managers often are not

aware that lower graded employees may have higher level qualifications

and thus seek job candidates from outside the agency.

F. Bargaining Unit Employees

anagement needs it. Our proposed

elimination of the restriction would free employees to seek other

opportunities, in any agency, without being dependent on management's

waiver action. Also, because of the restriction, managers often are not

aware that lower graded employees may have higher level qualifications

and thus seek job candidates from outside the agency.

F. Bargaining Unit Employees

One employee union suggested that OPM should not allow agencies to

eliminate time in grade for nonbargaining unit employees while

continuing to apply it to those in bargaining units. OPM's proposal is

consistent with the National Partnership Council recommendations to

abolish the regulatory time-in-grade rule. Inasmuch as time in grade

has been a condition of employment for bargaining unit employees, the

Council recommended that it should remain in effect until the

bargaining unit parties (agency management and union) agree to modify

it either through consensus or collective bargaining. In other words,

OPM's elimination of the regulation would have no effect on bargaining

unit positions unless the parties agreed to modify or eliminate time in

grade.

OPM has no authority to require agencies to seek agreement with

unions, through consensus or collective bargaining, over time-in-grade

provisions or to prohibit agencies from implementing a

regulatory revision affecting nonbargaining unit positions.

G. Public Notice

regulation would have no effect on bargaining

unit positions unless the parties agreed to modify or eliminate time in

grade.

OPM has no authority to require agencies to seek agreement with

unions, through consensus or collective bargaining, over time-in-grade

provisions or to prohibit agencies from implementing a

regulatory revision affecting nonbargaining unit positions.

G. Public Notice

Many individual commenters asked that we ensure proper

dissemination of National Performance Review initiatives to all levels

of the work force to allow greater input and commentary. Some

commenters suggested that OPM's 60-day comment period on the initial

proposal appeared to be designed to restrict the number of comments and

commenters.

OPM's 60-day comment period is the standard open period for

receiving comments on proposed regulatory changes. As is our usual

practice required by law, OPM distributed the time-in-grade proposal to

agencies with instructions for public posting. OPM also made the

proposal available through its primary electronic bulletin board,

Mainstreet, at 202-606-4800. OPM issued a press release on the

proposal, and it was widely reported in the press. We are taking the

same steps with this notice. Furthermore, the recommendations of the

NPR and the National Partnership Council were widely reported in the

press and in newsletters that reach employees.

Authority: 5 U.S.C. secs. 552, 3301, 3302; E.O. 10577, 3 CFR,

1954-1958 Comp., page 218, unless otherwise noted.

Secs. 300.101 through 300.104 also issued under 5 U.S.C. secs.

7201, 7204, 7701; E.O. 11478, 3 CFR, 1966-1970 Comp., page 803.

Secs. 300.401 through 300.408 also issued under 5 U.S.C. secs.

1302(c), 2301, and 2302.

Secs. 300.501 through 300.507 also issued under 5 U.S.C.

1103(a)(5).)

Office of Personnel Management.

James B. King,

Director.

[FR Doc. 95-562 Filed 1-9-95; 8:45 am]

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