[Federal Register: May 6, 2005 (Volume 70, Number 87)]
[Notices]
[Page 23996-23999]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr06my05-41]
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DEPARTMENT OF COMMERCE
National Institute of Standards and Technology
Alternative Personnel Management System (APMS) at the National
Institute of Standards and Technology
AGENCY: National Institute of Standards and Technology, Department of
Commerce.
ACTION: Notice of Modifications with Request for Comment.
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SUMMARY: This notice provides for changes to the existing provisions of
the National Institute of Standards and Technology's (NIST) Alternative
Personnel Management System (APMS) published October 21, 1997, (62 FR
54606), primarily to strengthen the link between pay and performance,
to simplify the pay-for-performance system, and to broaden the link
between performance and retention service credit for reduction in
force.
DATES: This notice is effective on May 6, 2005. Comments must be
received no later than June 6, 2005.
ADDRESSES: Send or deliver comments to Robert Kirkner, Human Resources
Management Division, National Institute of Standards and Technology,
Building 101, Room A-133, 100 Bureau Drive, Gaithersburg, MD 20899-
3550, FAX: (301) 948-6107, or e-mail comments to
robert.kirkner@nist.gov.
FOR FURTHER INFORMATION CONTACT: Robert Kirkner at the National
Institute of Standards and Technology, (301) 975-3005; Joan Jorgenson
at the U.S. Department of Commerce, (202) 482-4233; Jill Rajaee at the
U.S. Office of Personnel Management, (202) 606-0836.
SUPPLEMENTARY INFORMATION:
Background
In accordance with Public Law 99-574, the NIST Authorization Act
for 1987, the Office of Personnel Management (OPM) approved a
demonstration project plan, ``Alternative Personnel Management System
(APMS) at the National Institute of Standards and Technology (NIST),''
and published the plan in the Federal Register on October 2, 1987, (52
FR 37082). The project plan has been modified twice to clarify certain
NIST authorities (54 FR 21331 of May 17, 1989, and 55 FR 39220 of
September 25, 1990). The project plan and subsequent amendments were
consolidated in the final APMS plan, which became permanent on October
21, 1997, (62 FR 54604).
The plan provides for modifications to be made as experience is
gained,
[[Page 23997]]
results are analyzed, and conclusions are reached on how the system is
working. This notice formally changes the APMS plan to further
strengthen the links between pay and performance, and performance and
retention service credit. Comments will be considered and any changes
deemed necessary will be made.
Dated: April 28, 2005.
Hratch G. Semerjian,
Acting Director.
Table of Contents
I. Executive Summary
II. Basis for APMS Plan Modification
III. Changes to the APMS Plan
I. Executive Summary
The National Institute of Standards and Technology's (NIST)
Alternative Personnel Management System (APMS) is designed to (1)
improve hiring and allow NIST to compete more effectively for high-
quality researchers through direct hiring, selective use of higher
entry salaries, and selective use of recruiting allowances; (2)
motivate and retain staff through higher pay potential, pay-for-
performance, more responsive personnel systems, and selective use of
retention allowances; (3) strengthen the manager's role in personnel
management through delegation of personnel authorities; and (4)
increase the efficiency of personnel systems through installation of a
simpler and more flexible classification system based on pay banding
through reduction of guidelines, steps, and paperwork in
classification, hiring, and other personnel systems, and through
automation.
Since implementing the APMS, according to findings in the Office of
Personnel Management's ``Summative Evaluation Report National Institute
of Standards and Technology Demonstration Project: 1988-1995,'' NIST is
more competitive for talent; NIST retained more top performers than a
comparison group; and NIST managers reported significantly more
authority to make decisions concerning employee pay. This modification
builds on this success by strengthening the link between pay and
performance and streamlining the current system.
This amendment replaces the current 100-point rating scale with six
performance ratings. Pay increases will be based on an annually
determined percentage of the mid-point salary for each pay band in the
career path and linked directly to the top three performance ratings,
strengthening the pay-for-performance link, increasing transparency,
and reducing potential payout variations among employees in the same
career path and pay band and with the same performance ratings. This
amendment also implements a required bonus for high-performing
employees who cannot receive a pay increase because they are at the cap
of their pay band, or their adjusted salaries would exceed the maximum
rate for their pay band. Finally, the provisions on retention service
credit for reduction in force and annual adjustments to basic pay are
being modified to correspond with these changes.
NIST will continually monitor the effectiveness of this amendment
and provide OPM with its findings.
II. Basis for APMS Plan Modification
The need to modify the current Pay for Performance System (PPS)
surfaced in the results of both the 2000 and 2002 NIST Employee
Surveys, the NIST Research Advisory Committee 2002 Report to the NIST
Director, stakeholder focus group feedback, and in discussions of the
NIST Senior Management Board. Generally, feedback indicated a need to
clarify and simplify the system and suggested ways that this could be
accomplished. The suggestions were found to have merit and are
incorporated into this modification.
The NIST system proposed modifications include replacing the
current 100-point rating scale with six performance ratings and linking
pay increases to the ratings. From highest to lowest, the six
performance ratings are: Exceptional Contributor, Superior Contributor,
Significant Contributor, Contributor, Marginal Contributor, and
Unsatisfactory.
Performance ratings are determined based on the cumulative ratings
and relative weights of the critical elements. Critical elements are
rated using benchmark standards and any supplemental standards. The
ratings for the critical elements are: exceeds expectations (E), fully
successful (S), minimally meets expectations (M), or unsatisfactory
(U).
Performance pay increases will be based on the annually determined
percentage of the mid-point salary for each pay band in the career
path. When the percentage is applied to the mid-point salary in each
pay band, the resulting dollar amount is the unit of salary increase or
``I'' for that pay band and career path. The ``I'' is used to determine
salary increases NIST-wide. The Director, however, may authorize an
operating unit to use a lower ``I'' for reasons related to solvency.
Actual salary increases based on multiples of ``I'' are granted to
employees in the top three performance levels as follows: Exceptional
Contributor: ``I'' x 5; Superior Contributor: ``I'' x 3; and
Significant Contributor: ``I.'' A salary-capped employee with an
Exceptional Contributor or Superior Contributor rating must receive a
bonus at least equivalent to the salary increase that would have been
received if the employee's salary were not capped.
In addition to receiving a performance pay increase, employees with
Exceptional Contributor, Superior Contributor, and Significant
Contributor ratings receive the full annual basic pay adjustment
(general and locality pay increases) and are eligible for a bonus.
Employees with a Contributor rating do not receive a performance pay
increase but do receive the full annual basic pay adjustment and are
eligible for a bonus. Employees rated Marginal Contributor or
Unsatisfactory do not receive a performance pay increase, bonus, or
annual basic pay adjustment.
The current provision on additional service credit for reduction-
in-force purposes is revised to correspond with these changes. For
retention purposes, this modification grants 10 additional years of
service for a rating of Exceptional Contributor, eight additional years
of service for a rating of Superior Contributor, three additional years
of service for a rating of Significant Contributor, and one additional
year of service for a rating of Contributor.
III. Changes in the APMS Plan
The APMS at the NIST, published in the Federal Register October 21,
1997, (62 FR 54604), is amended as follows:
1. Promotion: The subsection titled ``Promotion'' (62 FR 54609) is
replaced with the following:
Promotion
A promotion is a change of an employee to (1) a higher pay band in
the same career path or (2) a pay band in another career path in
combination with an increase in pay. An employee must have a current
performance rating of Contributor or higher to be eligible for
promotion. The time-in-pay-band requirement for promotion eligibility
is 52 weeks with two exceptions: (1) An employee may be promoted from
pay band I to band II in the Support career path without time
restriction; and (2) an employee may be promoted from pay band II to
band III in the Support career path without time restriction if the
employee was not promoted from a band I to band II position during the
previous 52 weeks. (For pay provisions related to promotion, see ``Pay
Administration.'')
[[Page 23998]]
2. Link Between Performance and Retention: The subsection titled
``Link Between Performance and Retention'' (62 FR 54609) is replaced
with the following:
Link Between Performance and Retention
An employee with a performance rating of Exceptional Contributor is
credited with 10 additional years of service for retention purposes. An
employee with a performance rating of Superior Contributor is credited
with eight additional years of service for retention purposes. An
employee with a performance rating of Significant Contributor is
credited with three additional years of service for retention purposes.
An employee with a performance rating of Contributor is credited with
one additional year of service for retention purposes. The total credit
is based on the employee's three most recent annual performance ratings
of record received during the four-year period prior to an established
cutoff date, for a potential total credit of 30 years. No reduction-in-
force credit converts to this system from any other performance
appraisal system.
3. Placement in a Lower Pay Band: The subsection titled ``Placement
in a Lower Pay Band'' (62 FR 54609) is replaced with the following:
Placement in a Lower Pay Band
An employee whose performance rating is Marginal Contributor or
Unsatisfactory does not receive the NIST annual adjustment to basic
pay. Because the minimum pay rate for each pay band is increased each
year by the amount of the NIST annual adjustment to basic pay, it is
possible that the new minimum rate of a pay band will exceed the basic
pay of an employee in that pay band who does not receive the NIST
annual adjustment to basic pay due to a Marginal Contributor or
Unsatisfactory performance rating. When this happens, the employee is
placed in the next lower pay band. This placement shall not be
considered an adverse action under 5 U.S.C. 7512; nor shall grade
(i.e., pay band) retention under 5 U.S.C. 5362 be applicable.
4. Effect of General and Locality Pay Increases on Individual Pay:
The subsection titled ``Effect of General and Locality Pay Increases on
Individual Pay'' (62 FR 54610) is replaced with the following:
Effect of General and Locality Pay Increases on Individual Pay
Only employees with a current performance rating of Contributor or
above may receive the full amount of increase in their basic pay
(including locality pay) at the time of pay band adjustments. This
increase in basic pay will reflect any applicable general and/or
locality pay increase for General Schedule employees. The increase in
basic pay for employees with a rating of Contributor or above, whose
basic pay is at the ceiling of their pay band, will equal the increase
in the ceiling.
The basic pay increase for eligible employees whose basic pay is
below the ceiling of their band will be calculated by applying a factor
to the employee's rate of pay. The factor is based on the net pay
increase for General Schedule employees in the locality, including both
the general increase and any applicable locality pay increase.
Employees with ratings of Contributor or above will receive the full
amount of the net increase, and the factor is equal to 1 plus the net
increase percentage (expressed as a decimal). For example, if the net
increase for a locality were 3.22 percent, the factor for Contributor
or above would be 1.0322. Thus, the new rate of basic pay for an
employee with a rating of Contributor or above would be calculated
using the following formula:
New pay rate = (1 + net pay increase) x former pay rate
However, a basic pay increase will be applied only to the extent
that it does not cause an employee's basic pay to exceed the pay band
ceiling.
5. Performance Plans: The subsection titled ``Performance Plans''
(62 FR 54611) is replaced with the following:
Performance Plans
At the beginning of each rating period, supervisors develop and
issue performance plans with input from employees. The plans contain
from three to six critical performance elements for each position. For
performance planning and appraisal purposes, only critical elements are
used. The supervisor assigns a weight of 1, 2, 3, or 4 to each element
indicating its relative level of importance to the position, so that
the total weight of all elements is 10. Benchmark performance standards
define the range of performance required to exceed expectations, be
fully successful, minimally meet expectations, and be unsatisfactory. A
supervisor may supplement the standards to add specificity or clarify
expectations.
6. Performance Appraisal: The subsection titled ``Performance
Appraisal'' (62 FR 54611) is replaced with the following:
Performance Appraisal
The performance appraisal brings supervisors and employees together
to discuss performance and accomplishments during the performance
rating cycle. The appraisal leads to decisions affecting performance
ratings, performance pay increases, and bonuses. Performance appraisals
normally occur at the end of the rating period. However, a supervisor
should issue a performance improvement plan and take appropriate
follow-up action any time an employee's performance is unsatisfactory.
7. Performance Ratings: The subsection titled ``Performance
Ratings'' (62 FR 54612) is replaced with the following:
Performance Ratings
The NIST APMS performance ratings are Exceptional Contributor,
Superior Contributor, Significant Contributor, Contributor, Marginal
Contributor, and Unsatisfactory. Performance ratings are determined
based on the cumulative ratings and weights of the critical elements in
the performance plan. Performance in each critical element is evaluated
using the benchmark standards and any supplemental standards, and the
element is assigned a rating that exceeds expectations (E), fully
successful (S), minimally meets expectations (M), or unsatisfactory
(U).
The rating of the element is then matched with the weighted value
of that critical element to produce a value for the element. For
example, if an element is weighted 4 and the element is assigned a
rating that exceeds expectations (E), then that element has a value of
4E.
Once this matching is completed and the elements are totaled,
performance ratings are assigned using the following table.
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Performance rating Critical element ratings
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Exceptional Contributor................... At least 8E; None below S.
Superior Contributor...................... At least 6E; None below S.
Significant Contributor................... At least 3E; Up to 2M.
Contributor............................... Up to 3M.
Marginal Contributor...................... 4 or more M.
Unsatisfactory............................ 1 or more U.
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An employee with unsatisfactory performance in one or more critical
elements is considered unsatisfactory overall and is given a
performance improvement plan and an opportunity to improve. If the
employee's performance remains unsatisfactory at the end of an
opportunity to improve,
[[Page 23999]]
the supervisor initiates appropriate follow-up action; i.e.,
reassignment, proposed change to a lower pay band, or proposed removal.
8. Performance Scores: The subsection titled ``Performance Scores''
(62 FR 54612) is deleted.
9. Performance Ranking: The subsection titled ``Performance
Ranking'' (62 FR 54612) is replaced with the following:
Performance Ranking
Performance ranking has been tested and found to be not appropriate
for most positions covered by this modification. The Director may
authorize the use of ranking where it is found to be appropriate.
10. Performance Pay Decisions: The subsection titled ``Performance
Pay Decisions'' (62 FR 54612) is replaced with the following:
Performance Pay Decisions
Annually, the NIST Director determines the amount of a unit of
increase, or ``I,'' based on a percentage of the mid-point salary for
each pay band of each career path. The percentage may vary by career
path but must be the same for all pay bands within a career path.
Performance pay increases are linked directly to performance ratings.
An employee with an overall performance rating of Exceptional
Contributor receives a performance pay increase equal to five units of
increase, or 5 x ``I.'' A Superior Contributor receives a performance
pay increase equal to 3 x ``I.'' A Significant Contributor receives a
performance pay increase equal to ``I.'' The actual dollar amount of a
performance pay increase depends upon an employee's career path and pay
band. Employees may not receive an increase that causes their salary to
exceed the maximum rate for their pay band.
Employees with Contributor, Marginal Contributor, or Unsatisfactory
ratings do not receive performance pay increases.
11. Performance Bonuses: The subsection titled ``Performance
Bonuses'' (62 FR 54612) is replaced with the following:
Performance Bonuses
Bonuses are the only cash awards linked to the NIST APMS pay-for-
performance system. They are awarded at the end of the performance
rating period and may be granted in conjunction with performance pay
increases. A pay pool manager may award a bonus to any employee with a
performance rating of Contributor or higher. A pay pool manager is a
line manager who manages his or her organization's pay increase and
bonus fund and has final decision authority over the performance
ratings and bonuses of subordinate employees. An employee with an
Exceptional Contributor or Superior Contributor rating whose adjusted
salary would exceed the maximum rate for the pay band must receive a
bonus at least equivalent to the amount of the performance pay increase
over the maximum rate but may receive more.
12. Employee Development: The subsection titled ``Employee
Development'' (62 FR 54612) is replaced with the following:
Employee Development
The objective of the NIST Employee Development Program is to
develop the competence of employees for maximum achievement of NIST
mission and goals. The NIST APMS legislation mandates the continuance
of an employee development program including, in appropriate
circumstances, a sabbatical program. The NIST APMS sabbatical program
is consistent with the terms and conditions of the Senior Executive
Service sabbatical program. It covers all career appointees under the
NIST APMS who have at least seven years of Federal service and a
current performance rating of Contributor or higher.
[FR Doc. 05-9116 Filed 5-5-05; 8:45 am]
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