HRDG 4500 - Recruitment and Retention Incentives - Introduction

On November 5, 1990, the Pay Reform Act became law. The Act's goals were to:

• Achieve pay parity between the public and private sectors on a locality-by-locality basis and,
• Improve our ability to recruit and retain employees.

The Office of Personnel Management and the USDA Office of Human Resources Management (OHRM) interpreted the law and issued regulations pertaining to the law's provisions. Contained in this Subchapter is information for implementing the provisions.

The regulations related to the provisions are:

Advance in Pay - Payment of basic pay made, in one or more installments covering not more than 2 pay periods, to any individual who is newly appointed in the agency or appointed following a break in service of at least 90 days.

Commuting Area - A geographic area that normally is considered one area for employment purposes. It includes any population center (or two or more neighboring ones) and the surrounding localities where people live and reasonably can be expected to travel back and forth daily to work.

Continuing Pay - The aggregate of basic pay, any other forms of pay that are paid in the same manner and at the same time as basic pay, and annual premium pay received by an employee at any one time.

Critical Position - A position which requires expertise of an extremely high level in a scientific, technical, professional, or administrative field; and which is critical to the agency's successful accomplishment of an important mission; and may be established only to the extent necessary to recruit or retain an individual exceptionally well qualified for the position.

Critical Position Pay Authority - Authority that may be granted by the Office of Management and Budget under 5 U.S.C. 5377 to set the rate of basic pay for a critical position.

Federal Employees Pay Comparability Act of 1990 - "Pay Reform" Act of 1990 signed into law by President Bush on November 5, 1990.

Interim Geographic Adjustments - Adjustments, established by the President, of up to eight percent of basic pay which may be paid to each General Schedule (GS) employee whose duty station is within any geographic area where such adjustment is needed because of recruitment and retention problems.

Locality-Based Comparability Payments - Payments to GS employees who work in geographic locations determined to have a pay disparity of five percent or more between the public and private sectors.

Positions Above GS/GM-15 - Formerly classified as GS-16, 17, and 18 and excluded from the Senior Executive Service (SES) or those that do not meet the functional criteria (e.g., managerial or supervisory responsibilities) for inclusion in the SES.

Promotion - A change from a lower to a higher level position.

Retained Pay - Pay authorized to be paid to an employee for a two year period after the employee has been demoted to a lower grade through no fault of his or her own.

 Recruitment Bonus Incentive - A lump sum Payment(s) of up to 25 percent of annual basic pay made to a candidate to whom a written offer has been made (and accepted in writing) or to an employee appointed to a position for the first time or following a break in service of one year at least 90 days. The incentive is used for positions that have been deemed difficult to fill with a high quality candidate without the use of the incentive. Payment is not considered to be part of basic pay for any purposes.

 Recruitment Bonus Relocation Incentive - A lump sum Payment(s) of up to 25 percent of annual basic pay made to a candidate current employee who must relocate to accept a position in a different commuting / geographic area or whose duty station has changed permanently / temporarily to a different commuting area. to whom a written offer has been made (and accepted in writing) or to an employee appointed to a position for the first time, regardless of tenure, or following a break in service of at least 90 days. Payment is not considered to be part of basic pay for any purposes.

 Retention Allowance Incentive - Payment(s) of up to 25 percent of annual basic pay made to a current employee who has completed at least one year of continuous active service with the agency. The incentive is used to retain an employee with unusually high or unique qualifications or a special agency need and in the absence of the incentive the employee is likely to leave Federal service. Payment is made at the same time as basic pay, but is not considered to be part of basic pay for any purposes.

Scientific and Professional Positions - Established by 5 U.S.C. 3104 to carry out research and development functions.

Special Occupational Pay System - Established for any occupation or group of occupations for which the current pay system does not function adequately, or which, for reasons of good administration, should not be classified under Chapter 51 (Classification) of Title V of the U.S. Code.

Special Salary Rates - A special base salary paid to an employee, or group of employees, in any civilian position(s), under any pay system established by or under Federal statute within the executive branch, for which recruitment or retention problems exist, or are likely to exist.

Supervisory Differential - Additional pay for the supervisor of one or more civilian employees whose positions are not under the GS and who would, in the absence of such a differential, be paid more than the supervisor.

The following chart provides an overview of the pay flexibilities described in this Subchapter: