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Pay & Leave Recruitment, Relocation & Retention Incentives

 

Overview

Recruitment, relocation, and retention incentives (3Rs) are compensation flexibilities available to help Federal agencies recruit and retain a world-class workforce. The 3Rs are administered under 5 U.S.C. 5753 and 5754 and 5 CFR part 575, subparts A, B, and C.

Memos & Reports

Compensation Policy Memoranda

Reports to Congress

Section 101(c) of the Federal Workforce Flexibility Act of 2004 (Public Law 108-411, October 30, 2004) required the U.S. Office of Personnel Management (OPM) to submit an annual report to specified committees of the United States Senate and the United States House of Representatives on agencies' use of the recruitment, relocation, and retention incentive authorities in 5 U.S.C. 5753 and 5754 during calendar years 2005-2009. The report provide data on and describe each agency's use of the incentives during the calendar year.

Calendar Year 2009

Previous Calendar Years

Fact Sheets

Non-GS Employees

Recruitment, Relocation, and Retention Incentives: Coverage of Non-General Schedule Employees Under Single-Agency Pay Systems

Upon the request of the head of an executive agency, the U.S. Office of Personnel Management (OPM) may approve coverage under the recruitment, relocation, and retention incentive authorities of one or more categories of non-General Schedule employees in a single agency. (See 5 U.S.C. 5753(a)(1)(B) and 5754(a)(1)(B) and OPM regulations at 5 CFR 575.103(a)(7), 575.203(a)(7), and 575.303(a)(7).)

Agencies with one or more categories of non-General Schedule employees who are not specifically covered by the 3Rs regulations or an OPM approval may not provide 3Rs to these employees unless the agency has a separate statutory authority to do so. The statute must provide authority for the agency to grant payments similar to the 3Rs or additional compensation. A statute that only provides an agency with the authority to fix rates of basic pay for a category of employees would generally not be interpreted as providing authority to pay 3Rs payments because 3Rs are not considered rates of basic pay.

The following list shows the categories of employees OPM has approved to be covered by the 3Rs under 5 U.S.C. 5753 and 5754. The original approval date is in brackets after each category of employees.

Agriculture

AD (administratively determined) employees paid under 7 U.S.C. 426a, b, and c and appointed under 5 CFR 213.3113(a)(1) [04/27/1995]

Commerce

NOAA marine wage employees [10/23/1992]

AD and GG employees (Census Bureau) [05/05/1998]

Corporation for National Service

AD employees paid under 42 U.S.C. 12653h(c)(3) [09/15/1993]

Employees under Corporation for National Service alternative personnel system authorized by the National Community Service Trust Act of 1993 (Public Law 103-82) [12/01/1995]

Defense

Employees appointed under enabling legislation for National Security Agency, Defense Intelligence Agency, and Civilian Intelligence Personnel Management System [11/17/1991]

Employees appointed under enabling legislation for USNA, Naval War College, Naval Postgraduate School, Army War College, Air Force Institute of Technology, and Air University [12/31/1991]

Navy marine wage employees [06/25/1992]

Faculty and staff of the Uniformed Services University of the Health Sciences (USUHS) [10/19/1992]

Employees of section 6 schools [01/15/1993]

Employees under the Department of the Navy's Space and Warfare Command and Naval Air Warfare Center Weapons Division alternative personnel system [05/30/2001]

Professional educators in the Department of Defense Education Activity paid under 20 U.S.C. chapter 29 [12/04/2001]

Employees of the Defense Language Institute Foreign Language Center (DLIFLC) Faculty Personnel System covered by 10 U.S.C. 1595 [02/18/2005]

Employees of the Asia-Pacific Center for Security Studies (APCSS) covered by 10 U.S.C. 1595 [06/07/2005]

Employees appointed under 5 U.S.C. 3161(b) in the Office of the Special Inspector General for Iraq Reconstruction [01/18/2006]

Employees of the Department of Defense National Defense University (including the Africa Center for Security Studies, the Center for Hemispheric Defense Studies, and the Near East South Asia Center for Strategic Studies) and the George C. Marshall Center for Security Studies whose pay is administratively determined under 10 U.S.C. 1595 [04/10/2006]

National Geospatial-Intelligence Agency employees whose pay is administratively determined under 10 U.S.C. 1601 [02/23/2007]

Employees appointed under 5 U.S.C. 3161(b) in the Office of the Special Inspector General for Afghanistan Reconstruction [03/29/2010]

Military Compensation and Retirement Modernization Commission employees appointed under 5 U.S.C. 3161(b) whose pay is administratively determined [09/06/13]

Defense Nuclear Facilities Safety Board

Professional and technical personnel paid under Section 161d of the Atomic Energy Act of 1954 (as amended by Public Law 101-510) [01/02/2008]

Education

Senior managers and technical and scientific employees in the Office of Student Financial Assistance Programs appointed and paid under the Higher Education Act of 1998 (Public Law 105-44) [09/30/1999]

Election Assistance Commission

Employees paid in accordance with section 204(a) of the Help America Vote Act of 2002 [10/08/2004]

Energy

Power system dispatchers [01/15/1993]

Wage board employees of the (1) Bonneville Power Administration whose pay is negotiated under the Bonneville Project Act of 1937 (16 U.S.C. 8321); (2) Southwestern Power Administration whose pay is negotiated under the Department of Interior secretarial Order No. 19865, August 31, 1943; and (3) Western Area Power Administration whose pay is negotiated under section 9(b) of Public Law 92-392 and section 704 of Public Law 95-454 [01/13/2000]

Scientific, engineering, technical, and professional employees paid under section 621(d) of the Department of Energy Organization Act (pay plan EJ), section 3161 of the National Defense Authorization Act for Fiscal Year 1995 (Public Law 103-337) (pay plan EK), and section 3241 of the National Defense Authorization Act for Fiscal year 2000 (Public Law 106-65) (pay plan EN) [05/22/2001]

Employees in the ER and ET pay plans established for Advanced Research Projects Agency-Energy (ARPA-E) [05/22/2012]

Exceptionally well qualified individuals in the EQ pay plan appointed under section 313 of division D of the Consolidated Appropriations Act, 2014 (Public Law 113-76), to scientific, engineering, or other critical technical positions. [6/25/2014]

Environmental Protection Agency

Employees appointed to a position under the administratively determined (AD) pay authority established by the Safe Drinking Water Act Amendments (Public Law 95-190, November 16, 1977) [08/21/2002]

Health and Human Services

Employees appointed to the Senior Biomedical Research Service under 42 U.S.C. 237 [04/20/1999]

Interior

Prevailing rate employees whose pay is negotiated under section 9(b) of the Government Employees Prevailing Rate Systems Act, Public Law 92-392, and section 704 of the Civil Service Reform Act, Public Law 95-454 [05/04/2001]

International Broadcasting Bureau

Non-U.S. citizen employees appointed under 22 U.S.C. 1474(1) and the Smith-Mundt Act (Public Law 80-402). Employees are excepted service paid under chapter 18 of title 22, United States Code (Public Law 101-249, February 16, 1990) [03/24/2003]

Justice

U.S Attorneys, Assistant U.S. Attorneys, U.S. Trustees, and Assistant U.S. Trustees [08/19/1991]

Immigration judges paid under section 371(a) of the Illegal Immigration Reform and Immigrant Responsibility Act of 1996 [12/26/1996]

Millennium Challenge Corporation

Employees who are paid in accordance with section 617(d) of the Millennium Challenge Act of 2003 (Public Law 108-199, Division D), and who are not among the 30 for which pay is administratively determined under section 617(c) of the Act [03/24/2004]

Morris K. Udall Foundation

AD employees paid under 20 U.S.C. 5608(a)(1) [01/15/2009]

National Aeronautics and Space Administration

AD employees paid under 42 U.S.C. 2473(c) [09/18/1991]

National Science Foundation

Employees appointed under 42 U.S.C. 1864a and 1873(a) [10/22/1991]

Office of Personnel Management

Experts and consultants appointed under 5 U.S.C. 3109 whose pay is determined in accordance with 5 CFR part 304. [2/18/2014]

Overseas Private Investment Corporation

AD employees paid under 22 U.S.C. 2193(d) [08/07/1991]

State

Employees appointed under the Foreign Service Act of 1980 and U.N. Participation Act of 1945 [09/03/1991]

Treasury

National Taxpayer Advocate appointed and compensated under 7803(c)(1)(B) of the Internal Revenue Code of 1986, as amended by section 1102(a) of the Internal Revenue Service Restructuring and Reform Act of 1998 [08/08/1998]

Employees appointed and compensated under the streamlined critical pay authority at 5 U.S.C. 9503, as established by section 1201(a) of the Internal Revenue Service Restructuring and Reform Act of 1998 [08/08/1998]

Police officers in the Bureau of Engraving and Printing (BEP) and the U.S. Mint paid under 5 U.S.C. 5378 [10/19/2000]

USAID

Employees appointed under the Foreign Service Act of 1980 and section 625(b) of the Foreign Assistance Act of 1961 [07/31/1992]

Veterans Affairs

Part-time and temporary positions appointed under 38 U.S.C. 7405 and listed in 38 U.S.C. 7401(1) (i.e., part-time and temporary physicians, dentists, podiatrists, optometrists, nurses, physician assistants, and expanded-function dental auxiliaries) [01/19/2001]

Part-time and temporary hybrid positions appointed under 38 U.S.C. 7405 and listed in 38 U.S.C. 7405(a)(1)(B) (i.e., part-time and temporary certified or registered respiratory therapists, licensed physical therapists, licensed practical/vocational nurses, pharmacists, and occupational therapists) [01/19/2001]

Executive clinical positions appointed under 38 U.S.C. 7306 [01/19/2001]

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Authority and Regulations

Extensions of Authority

View the categories of non-General Schedule employees in a single agency approved by OPM for 3Rs coverage.

Law and Regulations

  • 5 U.S.C. 5753 and 5754
  • 5 CFR part 575, subparts A, B, and C

FAQs

  • An agency must terminate a service agreement if an employee is demoted or separated for cause (i.e., for unacceptable performance or conduct), receives a rating of record lower than "Fully Successful" or equivalent during the service period, or otherwise fails to fulfill the terms of the service agreement.  In such cases, the employee must repay any portion of the incentive attributable to uncompleted service.  (See 5 CFR 575.111(h) and 575.211(h) for a repayment waiver authority.)  The employee is entitled to retain any incentive payments attributable to completed service.  Exception:  When the employee is separated as a result of material false or inaccurate statements or deception or fraud in examination or appointment, or as a result of failing to meet employment qualifications, the employee must repay all recruitment incentives received under that service agreement.  The agency is not obligated to pay the employee any outstanding incentive payment attributable to completed service unless such payment was required under the terms of the service agreement.  An agency must notify an employee in writing when it terminates a recruitment or relocation incentive service agreement.  (See 5 CFR 575.111 and 575.211.)
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  • For the purpose of paying a recruitment or relocation incentive, rate of basic pay means the rate of pay fixed by law or administrative action for the position to which an employee is or will be appointed, before deductions and including any special rate supplement under 5 CFR part 530, subpart C, or similar payment under other legal authority, and any locality-based comparability payment under 5 CFR part 531, subpart F, or similar payment under other legal authority, but excluding additional pay of any other kind. For example, a rate of basic pay does not include additional pay such as cost-of-living allowances or post differentials under 5 U.S.C. 5941, night shift differentials under 5 U.S.C. 5343(f) or environmental differentials under 5 U.S.C. 5343(c)(4). (See the definition of rate of basic pay in 5 CFR 575.102 and 575.202.)
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  • No, agencies are no longer required to consider using the superior qualifications and special needs pay-setting authority before they authorize a recruitment incentive. However, under 5 CFR 531.212(d) (as in effect on and after May 1, 2005), an agency must consider the possibility of authorizing a recruitment incentive when determining whether to use the superior qualifications and special needs pay-setting authority. The reason for the distinction is that agencies should first consider whether they can attract a candidate by using an authority which has limited implications for the agency budget because it does not increase the employee’s basic pay (e.g., a recruitment incentive) before using a flexibility that increases basic pay (e.g., the superior qualifications and special needs pay-setting authority) which has longer term cost implications.
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  • An agency must establish a single retention incentive rate for each individual or group of employees, expressed as a percentage of each employee’s rate of basic pay, not to exceed 25 percent (for an individual employee) or 10 percent (for a group or category of employees). (See 5 CFR 575.309(a).) With OPM approval, this cap may be increased to as much as 50 percent under the conditions specified in 5 CFR 575.309(e).
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  • No. Recruitment and relocation incentive payments are not subject to the biweekly or annual premium pay limitation, since recruitment and relocation incentives are neither premium pay nor basic pay.
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  • Agencies may not pay a recruitment or relocation incentive to an employee in a position (1) to which the individual was appointed by the President; (2) in the Senior Executive Service as a non-career appointee; (3) which has been excepted from the competitive service by reason of its confidential, policy-determining, policy-making, or policy-advocating character; (4) designated as the head of an agency, including an agency headed by a collegial body composed of two or more individual members; or (5) in which the employee is expected to receive an appointment as the head of an agency. (See 5 CFR 575.104 and 575.204.)
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  • It is up to the agency to decide how long to set the service period, within certain limitations (e.g., it cannot be shorter than 6 months for a recruitment incentive or longer than 4 years for a recruitment or relocation incentive). Since the reason for the incentive is to attract a candidate to accept a position or to encourage an employee to relocate to a position-and remain at that position-the agency should consider what service period would best help achieve these objectives, i.e., what the agency believes to be a reasonable period of service for the amount of incentive it is willing to pay.
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  • To request a retention incentive in excess of 25 or 10 percent, as applicable, the agency must be facing a critical need.  The agency must determine that the employee’s (or group of employees‘) unusually high or unique qualifications are critical to the successful accomplishment of an important agency mission, project, or initiative (e.g., programs or projects related to a national emergency or implementing a new law or critical management initiative). (See 5 CFR 575.309(e)(1).)
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  • Yes.  See 5 CFR 575.309(i) and the definition of aggregate compensation at 5 CFR 530.202.
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  • Before paying a recruitment or relocation incentive, an agency must establish a plan for using the authority.  (See 5 CFR 575.107 and 575.207.)  The plan must include the designation of officials with authority to review and approve the payment of recruitment or relocation incentives, the designation of officials with authority to waive the repayment of a recruitment or relocation incentive, the categories of employees who are prohibited from receiving recruitment or relocation incentives, the required documentation for determining that a position is likely to be difficult to fill, requirements for determining the amount of an incentive, the payment methods that may be authorized, requirements governing service agreements (including criteria for determining the length of a service period, the conditions for terminating a service agreement, and the obligations of the agency and the employee if a service agreement is terminated), and documentation and recordkeeping requirements.   Unless the head of the agency determines otherwise, agency recruitment and relocation incentive plans must apply uniformly across the agency.
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  • There is no set period of employment under a retention incentive service agreement.
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  • Each agency must keep a record of each determination to pay a retention incentive and make such records available for review upon OPM's request. (See 5 CFR 575.313(a).)
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  • The service agreement may include any other terms or conditions that, if violated, will result in termination of the service agreement. For example, the service agreement may specify the employee’s work schedule, type of position, and the duties he or she is expected to perform. In addition, the service agreement may address the extent to which periods of time on detail, in a nonpay status, or in a paid leave status are creditable towards the completion of the service period. (See 5 CFR 575.310(e).)
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  • For hourly rate employees who do not have a scheduled annual rate of basic pay, compute the annual rate by multiplying the applicable hourly rate in effect at the beginning of the service period by 2,087 hours. (See 5 CFR 575.109(b)(2) and 575.209(b)(2).)
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  • A service agreement is required in most cases when a retention incentive is paid. It is required when the agency pays the incentive—
    • In a single lump-sum payment after completion of the full service period;
    • In installments after the completion of periods of service (except when the incentive is paid in biweekly installments at the full retention incentive percentage rate established for the employee);
    • In all cases where the 25 percent cap (or 10 percent for groups of employees) has been waived, no matter how payment is made; and
    • In all cases when an employee is likely to leave for a different position in the Federal service.
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  • Under 5 CFR 575.311(f)(3), an agency considers the following factors in determining whether to reduce or terminate a retention incentive:
    • Whether a lesser amount (or none at all) would be sufficient to retain the employee (or group or category of employees);
    • Whether labor market factors make it more likely (or reasonably likely) to recruit a candidate with competencies similar to those possessed by the employee (or group or category of employees); or
    • Whether the agency's need for the services of the employee (or group or category of employees) has been reduced to a level that makes it unnecessary to continue payment at the level originally approved, or at all.
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  • Agencies may pay a recruitment or relocation incentive to an eligible individual who is appointed to one of the following categories of positions: General Schedule (GS); senior-level or scientific or professional (SL/ST); Senior Executive Service (SES); Federal Bureau of Investigation and Drug Enforcement Administration (FBI/DEA) SES; law enforcement officer (LEO); Executive Schedule (EX); prevailing rate (wage) positions; and positions in a category for which payment of recruitment or relocation incentives has been approved by OPM at the request of the head of an executive agency. (See 5 CFR 575.103 and 575.203.)
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  • Because a retained rate is not basic pay for the purpose of computing a retention incentive, the maximum rate of basic pay for the employee’s grade must be used in place of the retained rate to calculate the retention incentive. (See 5 CFR 536.307.)
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  • Yes, if it is not possible to recruit the candidate solely through offering a recruitment incentive. (See 5 CFR 531.212(d).)
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  • An agency must consider the following factors, as applicable in the case at hand, in making a retention incentive determination for an individual employee or a group or category of employees likely to leave the Federal service:
    • Employment trends and labor market factors, such as the availability and quality of candidates in the labor market possessing the competencies required for the position and who, with minimal training, cost, or disruption of service to the public, could perform the full range of duties and responsibilities of the employee’s position at the level performed by the employee;
    • The success of recent efforts to recruit candidates and retain employees with qualifications similar to those possessed by the employee for positions similar to the position held by the employee;
    • Special or unique competencies needed for the position;
    • Agency efforts to use non-pay authorities to help retain the employee instead of or in addition to a retention incentive, such as special training and work scheduling flexibilities or improved working conditions;
    • The desirability of the duties, work or organizational environment, or geographic location of the position;
    • The extent to which the employee’s departure would affect the agency's ability to carry out an activity, perform a function, or complete a project the agency deems essential to its mission;
    • The salaries typically paid outside the Federal Government; and
    • Other supporting factors.
    (See 5 CFR 575.306(b) and 575.306(c).)
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Total Count: 112, Number of Pages: 6, Page: 4
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