Rule2024-16030
Time-Limited Promotions
Primary source
Metadata and text below are from the Federal Register, a public-domain U.S. government work. Always verify the official published version before relying on it for any legal matter.
Published
July 25, 2024
Effective
August 26, 2024
Issuing agencies
Personnel Management Office
Abstract
The Office of Personnel Management (OPM) is issuing a final rule to specify that employees who are detailed or temporarily promoted to higher-grade duties of a higher-graded position should be paid accordingly for the entire time spent performing the duties of the higher-graded position, as found pursuant to a final order by an appropriate authority.
Full Text
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<title>Federal Register, Volume 89 Issue 143 (Thursday, July 25, 2024)</title>
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[Federal Register Volume 89, Number 143 (Thursday, July 25, 2024)]
[Rules and Regulations]
[Pages 60289-60298]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2024-16030]
========================================================================
Rules and Regulations
Federal Register
________________________________________________________________________
This section of the FEDERAL REGISTER contains regulatory documents
having general applicability and legal effect, most of which are keyed
to and codified in the Code of Federal Regulations, which is published
under 50 titles pursuant to 44 U.S.C. 1510.
The Code of Federal Regulations is sold by the Superintendent of Documents.
========================================================================
Federal Register / Vol. 89, No. 143 / Thursday, July 25, 2024 / Rules
and Regulations
[[Page 60289]]
OFFICE OF PERSONNEL MANAGEMENT
5 CFR Part 335
[Docket ID: OPM-2023-0041]
RIN 3206-AO52
Time-Limited Promotions
AGENCY: Office of Personnel Management.
ACTION: Final rule.
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SUMMARY: The Office of Personnel Management (OPM) is issuing a final
rule to specify that employees who are detailed or temporarily promoted
to higher-grade duties of a higher-graded position should be paid
accordingly for the entire time spent performing the duties of the
higher-graded position, as found pursuant to a final order by an
appropriate authority.
DATES: Effective August 26, 2024.
FOR FURTHER INFORMATION CONTACT: Timothy Curry by email at <a href="/cdn-cgi/l/email-protection#2e4f595c6e415e4300494158"><span class="__cf_email__" data-cfemail="5e3f292c1e312e3370393128">[email protected]</span></a>
or by telephone at (202) 606-2930.
SUPPLEMENTARY INFORMATION:
I. Background
Agencies must follow competitive procedures for time-limited
promotions of more than 120 days to higher-graded positions in the
competitive service. 5 CFR 335.103. The Federal Labor Relations
Authority (FLRA) has found union proposals requiring the temporary
promotion of bargaining unit employees officially assigned to a higher-
graded position, or to the duties of a higher-graded position, for
certain specified time periods are within the duty to bargain.\1\ The
FLRA has further found that, under Federal personnel law, an employee
may be entitled to a temporary promotion for performing the duties of a
higher-graded position for an extended period of time. The FLRA has
emphasized that ``the entitlement must be based on a provision of a
collective bargaining agreement or an agency regulation making a
temporary promotion mandatory for details to, or the performance of the
duties of, a higher-grade position after a specified period of time.''
\2\ As a result, some collective bargaining agreements between Federal
agencies and unions have provisions requiring the temporary promotion
of employees officially assigned to a higher-graded position or to the
duties of a higher-graded position when such assignment is made without
use of competitive procedures. As provided for in 5 U.S.C. 7121,
disagreements on application and interpretation of such provisions are
subject to negotiated grievance procedures that provide for binding
arbitration.
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\1\ See National Federation of Federal Employees v. Department
of the Interior Bureau of Land Management, 29 FLRA 1491 (1987).
\2\ See National Treasury Employees Union v. Department of
Treasury Internal Revenue Service, 29 FLRA 348 (1987).
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Prior to 2004, arbitrators awarded backpay to employees who filed
grievances after being assigned to higher-graded duties and were not
temporarily promoted, and those awards were not time-limited to 120
days.\3\ However, on September 10, 2003, the FLRA, in accordance with 5
U.S.C. 7105(i), requested an advisory opinion from OPM regarding an
interpretation of 5 CFR part 335 and posed the following question:
``Where an agency violates a collective bargaining agreement provision
entitling employees to noncompetitive temporary promotions and an
arbitrator grants a retroactive temporary promotion of more than 120
days to remedy that violation with the retroactive promotion what is
the applicability, if any, of the requirements of 5 CFR part 335 Sec.
103(c)(1)(i) that `competitive procedures' apply to promotions
exceeding 120 days. If the requirements apply, what effect do they have
on the arbitral remedy of a retroactive temporary promotion exceeding
120 days?'' \4\ On February 27, 2004, the OPM General Counsel provided
a letter response to the FLRA. In its letter, OPM noted: ``Upon
analysis of this issue, OPM concludes that 5 CFR 335.103 applies and
that the arbitration award in this matter is contrary to the regulatory
requirement that executive agencies must apply competitive procedures
for the purposes of implementing temporary promotions in excess of 120
days.''
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\3\ See Oklahoma City Air Logistics Center, Tinker AFB, OK and
AFGE Local 9116, 42 FLRA 62 (October 1991); U.S. Department of the
Army, Fort Polk, LA, and the National Association of Government
Employees, Local R5-168, 44 FLRA 121 (1992); and Social Security
Administration and the American Federation of Government Employees,
Local 220, 57 FLRA 115 (2001).
\4\ The case before the FLRA that prompted the request to OPM
for an advisory opinion was United States Department of Veterans
Affairs Ralph H. Johnson Medical Center Charleston, South Carolina,
and National Association of Government Employees, 60 FLRA 46 (2004).
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Relying upon OPM's February 27, 2004, advisory opinion about 5 CFR
335.103(c)(1)(i), the FLRA rendered a decision finding that an
arbitrator's decision involving an employee of the Department of
Veterans Affairs (DVA), to the extent that it directs a retroactive
temporary promotion of more than 120 days, is contrary to 5 CFR
335.103(c) and a DVA regulation. The FLRA noted that OPM advised the
arbitrator's decision was contrary to a government-wide regulation, 5
CFR 335.103(c), by providing the grievant a retroactive temporary
promotion exceeding 120 days with no competitive process. Based on this
advisory opinion from OPM, the FLRA modified the arbitrator's award and
ordered the agency to grant the grievant a retroactive temporary
promotion with backpay for the difference between GS-7 and GS-9 wage
rate, effective August 1999, for a period of 120 days because there was
no evidence that competitive procedures were applied in the promotion
of the grievant.\5\ Furthermore, the FLRA decided there was ``no
showing that a personnel action resulted in the withdrawal or reduction
of the grievant's pay and therefore the grievant was not entitled to
back pay for the period exceeding the 120-day limitation.'' \6\
Following its decision in 2004, the FLRA has issued various decisions
which set aside portions of
[[Page 60290]]
arbitration awards ordering backpay on temporary promotions for the
time period exceeding 120 days when the temporary promotion occurred
without use of competitive procedures.\7\ These subsequent decisions by
the FLRA eventually resulted in a request to OPM by the National
Treasury Employees Union (NTEU).
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\5\ Id.
\6\ In a concurrence to the Johnson Medical Center decision,
Member Carol Waller Pope noted ``I have concerns that OPM's
interpretation actually encourages agencies to violate, rather than
comply with, Sec. 335.103(c). Specifically, under OPM's
interpretation, an agency that ignores competitive procedures cannot
be required to pay employees for higher-graded duties performed in
excess of 120 days, while an agency that complies with competitive
procedures can be required to pay employees for those duties. This
provides agencies a strong incentive to ignore competitive
procedures when they want to assign employees higher-graded duties
for more than 120 days.''
\7\ See United States Department of the Treasury Internal
Revenue Service and National Treasury Employees, 61 FLRA 667 (2006)
and United States Department of the Navy Commander, Navy Region Mid-
Atlantic Naval Weapons Station Earle and International Association
of Firefighters Local F-147, 72 FLRA 533 (2021).
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On August 5, 2022, OPM received a petition from NTEU, which
represents Federal workers in 34 agencies and departments,\8\ to amend
OPM regulations at 5 CFR 335.103 ``to remove the existing 120-day cap
on back pay for employees who perform higher graded work during
noncompetitive temporary promotions and details.'' NTEU noted that
OPM's existing regulation, as interpreted in the 2004 OPM advisory
opinion, has led to ``significant unfairness.'' \9\ NTEU stated that
prior to that advisory opinion, arbitrators had awarded back pay to
employees who performed higher-graded duties. ``Arbitrators made
employees whole for the time they spent performing such work, without
any 120-day limitation.'' NTEU expressed the view that the FLRA's 2004
decision abandoned years of former precedent by limiting the back pay
remedy for employees performing higher-graded duties to 120 days each
year. NTEU correctly noted that the FLRA's decision ``was based
entirely on [OPM's] advisory opinion.''
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\8\ See NTEU, ``Our Agencies,'' available at <a href="https://www.nteu.org/who-we-are/our-agencies">https://www.nteu.org/who-we-are/our-agencies</a>.
\9\ See NTEU petition posted here: www.nteu.org/~/media/Files/
nteu/docs/public/judicial-notice/opm-petition-re-120-day-rule.
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In response to NTEU's petition, OPM published a proposed rule in
the Federal Register at 88 FR 89321 on December 27, 2023. Specifically,
OPM proposed to amend 5 CFR part 335 to specify that a bargaining unit
employee found, pursuant to a final order by an arbitrator,
adjudicative body, or court, to have been detailed or temporarily
promoted to a higher-graded position should be paid accordingly (that
is, higher compensation) for the entire time the employee performed the
duties of the higher-graded position. This proposal was limited to
situations where an employee meets qualification and time-in-grade
requirements established by OPM regulations and the agency made the
assignment without use of competitive procedures. For bargaining unit
employees, this may include when a collective bargaining agreement
provided for the temporary promotion of employees officially assigned
to a higher-graded position or to the duties of a higher-graded
position when such assignment is made without use of competitive
procedures and the employee otherwise meets qualification and time-in-
grade requirements. As proposed, this provision would apply only when a
third party has found the employee is entitled to receive a retroactive
temporary promotion. The proposed amendment noted that an adjudicative
body could include, but not be limited to, a third party such as the
U.S. Merit Systems Protection Board (MSPB) or the Equal Employment
Opportunity Commission (EEOC). The proposed modification to 5 CFR
335.103(c)(2) would mean that competitive procedures do not apply to
situations where a third party has found the bargaining unit employee
is entitled to receive a retroactive temporary promotion.
Similarly, the proposed amendment provided that, when a non-
bargaining unit employee has been temporarily promoted to a higher-
graded position as found by an adjudicative body or court, that
employee should be paid accordingly (that is, higher compensation) for
the entire time performing these duties of a higher-graded position,
pursuant to a final order by that adjudicative body or court. It was
also limited to situations where an employee meets qualification and
time-in-grade requirements established by OPM regulations and the
agency made the assignment without use of competitive procedures. While
the issue originally arose based on disputes related to collective
bargaining agreements, OPM recognized that non-bargaining unit
employees may pursue grievances or complaints related to temporary
promotions in forums outside of procedures found in collective
bargaining agreements. The proposed rule addressed such matters for the
sake of consistency and fairness regardless of the employee's
bargaining unit status. As proposed, the provisions for non-bargaining
unit employees would only apply when a third party has found the
employee is entitled to receive a retroactive temporary promotion. The
proposed rule noted that an adjudicative body could include, but not be
limited to, a third party such as the MSPB or the EEOC. As with
bargaining unit employees, the proposed changes to 5 CFR 335.103(c)(2)
would mean that competitive procedures do not apply to situations where
a third party has found the non-bargaining unit employee is entitled to
receive a retroactive temporary promotion.
After considering the comments received, OPM is finalizing the
proposed amendments with modifications as discussed in the next
section.
Public Comments
In response to the proposed rule, OPM received 21 comments during
the 60-day public comment period from multiple individuals (primarily
Federal employees), multiple labor organizations, a professional
organization representing employment law lawyers, and one Federal
agency. At the conclusion of the public comment period, OPM reviewed
and analyzed the comments. In general, the comments largely supported
the rule change. The comments are summarized below, along with the
suggestions for revisions that were considered and either adopted,
adopted in part, or declined, and the rationale therefor.
In the first section below, we address general or overarching
comments. In the section that follows, we address comments related to
the specific portion of the regulation that OPM proposed to revise.
General Comments
A national labor organization expressed support for the rule and
stated the regulatory changes are necessary to ensure compliance with
merit system principles requiring fair and equitable treatment and
equal pay for work of equal value. Comment 0021.\10\ This labor
organization further noted the changes are necessary to ensure that
Federal agencies are properly incentivized to comply with Federal
regulations concerning the non-competitive placement of employees in
temporary promotions. The labor organization noted that employees, with
limited exceptions not applicable here, are obligated to follow the
instructions and orders of their supervisors and managers. Accordingly,
the primary remedy available to employees assigned to perform higher-
graded duties without a concurrent temporary promotion is to seek
third-party review of the agency's actions. The labor organization
noted that the changes ``will eliminate the arbitrary 120-day limit on
backpay recovery and are necessary to ensure that employees are fully
and fairly
[[Page 60291]]
compensated for the assigned work they perform.'' The labor
organization further stated, ``the elimination of the 120-day limit
will, moreover, lead to more effective and efficient administration of
the Federal government because it will remove the financial benefit
agencies accrued by failing to comply with OPM regulations.'' This
labor organization stated that OPM's proposed regulatory changes are
consistent with the statutory authority delegated to OPM to regulate
the civil service and laws governing the competitive service. Finally,
this labor organization stated that the FLRA decision and OPM's 2004
advisory opinion to the FLRA were ``based solely and myopically on the
existing OPM regulation,'' but OPM's ``proposed changes, on the other
hand, heed Congress' instruction that `[f]ederal personnel management
should be implemented consistent with the . . . merit system
principles,' 5 U.S.C. 2301, and ensure that appropriate deference is
given to the whole of Title 5.''
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\10\ References to comments provide the location of the item in
the public record (that is, the two-digit number associated with the
location in the docket). Comments filed in response to the proposed
rule are available at <a href="https://www.regulations.gov/comment/OPM-2023-0041-00nn">https://www.regulations.gov/comment/OPM-2023-0041-00nn</a>, where 00nn is the comment number.
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OPM thanks the labor organization for the support of the proposed
rule and is not making any changes based on these comments. However,
OPM wishes to respond to the labor organization's statement that ``the
elimination of the 120-day limit will, moreover, lead to more effective
and efficient administration of the Federal government because it will
remove the financial benefit agencies accrued by failing to comply with
OPM regulations.'' OPM notes that neither the proposed rule nor this
final rule is eliminating the requirement for agencies to use
competitive procedures when temporarily promoting employees for periods
exceeding 120 days. The requirements for competitive procedures have
not changed, but this final rule will require agencies to provide a
time-limited promotion as a result of a determination by an appropriate
authority as defined in 5 CFR 550.803.
Comment 0016, submitted by a professional organization representing
employment lawyers, supports the proposed rule, stating that it
clarifies that an employee working in a higher-graded position should
be compensated for the entire time they performed the duties. They
further note that the post-2004 FLRA cases that limited back pay to the
period of temporary promotion did not fit the reality of the actual
work performed at the higher grade. OPM thanks the commenter for their
support of the proposed rule. OPM will not be making any changes to the
proposed rule based on this comment as no recommendations for changes
were offered. Nevertheless, OPM believes it is important to remind the
commenter that the rule concerns situations where time-limited
promotions exceeding 120 days occurred and there was an order by a
third-party to provide the higher pay after a grievance or complaint
was filed by the employee. Furthermore, as discussed in the proposed
rule, the employee still needs to meet qualification and time-in-grade
requirements to receive the time-limited promotion. Finally, agencies
are not prohibited from detailing employees to higher-graded positions
or duties without commensurate pay. In accordance with 5 U.S.C. 3341,
an agency may detail an employee in the competitive service to a
position in either the competitive or excepted service. In other words,
time-limited promotions are not always required for details to higher-
graded duties. There may be exceptions, such as collective bargaining
agreement requirements, which require the employee to be temporarily
promoted.
Comment 0019, submitted by a coalition of 14 labor organizations,
noted that OPM's proposed changes will ``clarify that a bargaining unit
employee found by an adjudicator to have been detailed or temporarily
promoted to a higher-graded position should be paid accordingly (i.e.,
higher compensation) for the entire time the employee performed the
duties of the higher-graded position.'' These labor organizations
further state ``OPM correctly explains the cost of this change will be
negligible. And the compensating benefits are that the new rule will
reinforce merit system principles and rectify an inequitable state of
affairs for employees doing higher-graded work.''
These labor organizations also note the FLRA erroneously held in
2018 that a grievance on behalf of an employee who had not received
appropriate compensation for higher-graded work involved a
nongrievable, classification matter. They further note that the FLRA
corrected course a few years later explaining that a grievance concerns
a classification of a position under 5 U.S.C. 7121(c)(5) when ``the
substance of the grievance concerns the grade level of the duties
permanently assigned to and performed by an employee.'' They state that
``by contrast, a grievance does not involve classification within the
meaning of section 7121(c)(5) when its substance concerns whether the
employee is entitled to a temporary promotion . . . because the
employee has performed the established duties of a higher-graded
position.'' Therefore, they state that, to ensure the objective of the
proposed rule is met, they recommend that OPM should further clarify
that grievances seeking back pay owed for temporary promotions do not
involve classification matters within the meaning of 5 U.S.C.
7121(c)(5).
OPM thanks the labor organizations for their support of the
proposed rule. While OPM understands and appreciates the concerns
raised by the labor organizations regarding the impact of FLRA
decisions interpreting whether temporary promotions concern
classification matters within the meaning of 5 U.S.C. 7121(c)(5), the
issue raised is beyond the scope of this rulemaking, which addresses
the narrow issue of whether an individual may receive backpay for more
than 120 days in specified circumstances. Accordingly, OPM is not
making any changes based on this recommendation.
Two individual commenters recommended OPM modify the regulations to
allow agencies to continue temporary promotion rotations until the next
individual is in the position. Comment 0002 and 0003. One of these
commenters stated that administrative actions are held up by
administrative and leadership decisions while the other commenter
stated that it takes up to 8 months to fill the positions. The first
commenter noted it would be beneficial to end the temporary promotion
in conjunction with a set hiring date, instead of arbitrarily ending.
Likewise, the other commenter stated it would save time for human
resources personnel and allow for filling of critical positions. OPM
thanks the commenters for their suggestions but is not making any
changes based on these comments. OPM's interpretation of 5 CFR 335.103
continues to be that those agencies covered by this regulation must
apply competitive procedures for the purpose of implementing time-
limited promotions in excess of 120 days. This is consistent with the
wording of regulatory language that has existed for decades. OPM
believes requiring competition for these opportunities when they exceed
120 days supports the merit system principles outlined in 5 U.S.C. 2301
and provides greater opportunities for the workforce. While OPM
understands that competitive actions do not always occur on the
schedule desired by management, following these procedures does not
prevent agencies from adjusting and improving their internal hiring
processes and projecting when a time-limited promotion is scheduled to
end and preparing to select another candidate for the position.
Another individual commenter expressed support for the rule change
[[Page 60292]]
but noted they support paying employees in time-limited promotions for
the full time the employee is performing higher-graded duties, not just
the first 120 days. Comment 0005. OPM thanks the commenter for their
comments but is not making any changes to the rule based on this
comment. OPM's interpretation of 5 CFR 335.103 continues to be that
those agencies covered by this regulation must apply competitive
procedures for the purpose of implementing time-limited promotions in
excess of 120 days. OPM believes requiring competition for these
opportunities when they exceed 120 days supports merit system
principles and provides greater opportunities to the workforce.
Finally, the proposed rule allowed retroactive temporary promotions
only when there is a third-party decision ordering the retroactive
time-limited promotion. The final rule generally adopts this proposed
approach with minor revisions.
Several individual commenters expressed support for this rule and
noted that employees detailed to higher-graded duties should always be
compensated for higher pay. Comments 0007, 0008, and 0011. For example,
one commenter expressed support for this rule noting they are on detail
as an acting supervisor but without any higher pay. They noted that,
while they are learning, they believe they should be provided pay for
the detail or temporarily promoted for at least 120 days. Another
commenter stated they were assigned to a higher-graded position for a
year and a half but were not compensated and seek OPM's assistance.
Another commenter stated that there are employees detailed to higher-
graded or higher-level positions without formal paperwork and, when
paperwork is completed, the 120-day limit is rarely observed with
critical positions being vacant longer than 120 days. OPM thanks the
commenters but is not making any changes to the rule based on these
comments. As discussed in greater detail earlier in this preamble,
agencies are not precluded from detailing employees to higher-graded
positions without higher pay. In accordance with 5 U.S.C. 3341, an
agency may detail an employee in the competitive service to a position
in either the competitive or excepted service.
Comment 0020, submitted by an individual, suggested, if this rule
is adopted, there should be a tracking mechanism that would enable all
parties involved to see if they are in compliance. The commenter
described a personal situation where they were detailed to a higher-
graded position for more than 120 days but needed to file an EEOC
complaint to compel the agency to comply with a collective bargaining
agreement requirement regarding such matters. The commenter noted a
court ruled they were not entitled to any back pay despite producing
evidence they were doing the higher-graded work over the six-year
period in question. OPM thanks the commenter for their response but is
not making any changes to the rule based on this comment. Both the
proposed rule and final rule note there must be a third-party decision
ordering the retroactive time-limited promotion. The appropriate
mechanism for parties to address any compliance issues is with the
party ordering the retroactive time-limited promotion. It should be
noted that, in the case of the commenter, they state the court ruled
they were not entitled to any back pay. The commenter does not explain
the rationale the court used in making this determination. In any case,
this example highlights that not all third parties will necessarily
rule in favor of the employee, and this rule may not have changed the
outcome in the commenter's case. OPM also notes that this final rule is
prospective in nature and does not apply to any determinations made
prior to the effective date of the rule.
Comment 0012, submitted by an individual, stated this rule needs to
be adopted and observed by all agencies, even if there is no collective
bargaining agreement. The commenter noted that they have seen many
temporary promotions happening in excess of 120 days where the employee
has all of the duties and responsibilities of the higher-graded
position with no benefits of higher pay. Comment 0013, submitted by a
bargaining unit employee, stated they strongly support the proposed
rule. They noted that all employees who work higher-graded positions
should be granted the appropriate pay no matter the length of time they
are performing the duty. OPM thanks the commenters for supporting the
proposed rule. OPM is not making any changes based on these comments.
As discussed in the proposed rule, this is not limited to bargaining
unit employees covered by a collective bargaining agreement. Still, the
proposed rule noted there must be a third-party decision ordering the
retroactive time-limited promotion.
Comment 0018, submitted by an individual, stated they have been
acting in a Senior Executive Service (SES) position for 43 weeks
without higher compensation. The commenter recommended revisions should
be made to 5 CFR 317.903, which concerns details to SES positions. The
commenter also suggested the proposed rule should address changes to 5
CFR part 630 to address accrued annual leave for non-SES employees on
detail to SES positions. OPM thanks the commenter for these
suggestions. These comments and recommendations are outside the scope
of the rulemaking, so there are no changes to the rule based on this
comment.
Comment 0010, submitted by an individual, stated that the rule has
great potential to be implemented in a manner that sidesteps
competitive procedures. The commenter asserted the rule could, in some
agencies, prevent an individual from ever being eligible for promotions
as they may not receive proper time-in-grade credit. Finally, the
commenter stated there needs to be strict prohibitions in place
preventing any misuse by agency management, especially when the
agency's human capital team is lacking in its ability to provide
skillful oversight. OPM thanks the commenter for their concerns and
suggestions. OPM will not be making any changes to the proposed rule
based on this comment. OPM disagrees with the commenter's conclusion
this rule has great potential to be implemented in a manner that
sidesteps competitive procedures. As OPM noted in the proposed rule,
agencies must still use competitive procedures for any time-limited
promotion that exceeds 120 days. The rule only provides for a
retroactive time-limited promotion to a higher-graded position pursuant
to an order by a third-party to provide the higher-pay. Also, as
discussed earlier in this preamble, agencies have authority to detail
employees without providing time-limited promotions. OPM also disagrees
that this rule would prevent an individual from ever being eligible for
promotion. OPM notes that rules have always required an individual to
meet both qualification and time in grade requirements in order to
receive a time-limited promotion. OPM did not propose to change these
requirements.
Another individual stated that it is a fairly common occurrence
that agencies assign higher-graded duties to personnel beyond 120 days
without following competitive procedures. Comment 0014. They state
that, more often than not, employees accept the higher-graded duties in
hopes they will earn a greater chance of being selected for the
position when the agency finally opens the position for competition.
The commenter states this (1) reduces motivation for the agencies to
employ competitive procedures even when a need exists to do so; and (2)
potentially offers a competitive advantage to
[[Page 60293]]
employees who are willing to accept higher-graded assignments without
providing opportunities for others to do the same. OPM thanks the
commenter for their comments but is not making any changes based on
these comments as the commenter makes no recommendations on the
proposed rule. As discussed earlier in this preamble, agencies already
have the authority to detail employees to higher-graded duties without
receiving the higher pay.
Comment 0015, submitted by another individual, would like to see
the proposed rule adopted so that ``abusive practices'' will cease. The
commenter stated that it is crucial that employees assigned additional
duties, temporary promotions, or temporary details at higher grades are
compensated. They further note that failure to establish a policy
governing the duration of time-limited promotions and corresponding pay
discourages employees from seeking growth opportunities, prolongs
periods of vacancies, perpetuates unfair labor practices, and pay
inequity, and undermines morale and motivation. They stated that OPM
should regulate these practices to ensure the protection of employees
and their rights. OPM thanks the commenter for supporting the proposed
rule. OPM is not making any changes based on this comment as the
commenter makes no recommendations regarding the proposed rule. It is
worth noting that agencies are not precluded from detailing employees
to other positions without higher pay. It should also be noted that the
proposed rule only provides a retroactive time-limited promotion to a
higher-graded position pursuant to an order by a third-party to provide
the higher-pay. In other words, a third-party would need to make a
finding that a temporary promotion exceeding 120 days is appropriate
based on the circumstances. For example, an arbitrator could determine
the agency failed to follow requirements outlined in a collective
bargaining agreement and order a retroactive time-limited promotion as
a remedy.
Comment 0009, submitted by an individual, stated that rules are
always for the employer's benefit, and we should start working on rules
for a better working environment. This commenter stated that the time
spent in a temporary grade and step is not creditable towards the
completion of a waiting period when the employee is permanently
promoted. The commenter suggests this restriction on creditable service
be lifted so it can provide morale and financial benefits to employees
on time-limited promotions. This commenter also states that their
organization standardizes position descriptions and recommends they
instead be based on real responsibility and not standardized. OPM
thanks the commenter for these suggestions. These comments and
recommendations are outside the scope of the rulemaking, so OPM is not
making changes to the rule based on this comment.
Another individual commenter stated that detailing people into
higher-graded positions is happening more often and is needed because
the hiring process is too slow and needs to be fixed. Comment 0006. OPM
thanks the commenter for their comment but is not making any changes
based on this comment. This suggestion is beyond the scope of this
rulemaking as OPM did not propose any changes to the hiring process.
Finally, an individual commenter noted that the proposed rule only
permits a non-competitive time-limited promotion if a third party makes
a decision to do so. Comment 0022. The commenter notes that, for
bargaining unit employees, this scenario seems more likely if a
collective bargaining agreement calls for it but notes that collective
bargaining agreements also should be consistent with government-wide
regulations. Yet, the commenter observes that government-wide
regulations require competition for time limited promotions exceeding
120 days. The commenter asks whether OPM is giving arbitrators a green
light to ignore a government-wide regulation when making decisions on
this issue and whether OPM is doing the same for agencies and unions
when negotiating new collective bargaining agreement. The commenter
asks about non-bargaining unit employees who are not covered by a
collective bargaining agreement. The commenter suggests it is not
likely that a third party would order a temporary promotion exceeding
120 days for a non-bargaining unit employee not covered by a collective
bargaining agreement. The commenter expresses skepticism that the MSPB
would adjudicate matters related to this issue and questions whether
the EEOC or U.S. Office of Special Counsel would hear such complaints.
The commenter questions whether employees could file a pay claim with
OPM or another third party on such matters.
OPM thanks the commenter for their comments but will not be making
any changes to the proposed rule based on these comments as the
commenter does not make any recommendations regarding changes to the
proposed rule. The proposed rule does not allow arbitrators to ignore
regulatory requirements. In fact, this final rule changes the
regulations to allow arbitrators to provide a remedy for employees
where an agency has not complied with regulatory requirements.
Similarly, this final rule does not allow agencies or unions to ignore
regulatory requirements. The background in the proposed rule provided
extensive detail regarding OPM's expectations that agencies comply with
the requirements to use competitive procedures for time-limited
promotions exceeding 120 days. The proposed rule reminded agencies to
be mindful of government-wide regulations on this matter when
negotiating new collective bargaining agreements which include any
procedures regarding time-limited promotions. The proposed rule also
reminded agencies to be mindful of these regulations when subjecting a
collective bargaining agreement to agency head review under the Federal
Service Labor-Management Relations Statute. OPM repeats these reminders
in this final rule in greater detail in the preamble for ``Section
335.103--Agency Promotion Program.'' The scope of this rule is limited
to situations where an employee meets qualification and time-in-grade
requirements established by OPM regulations; and an appropriate
authority has made a determination the employee is entitled to a
retroactive time-limited promotion to resolve a grievance or a
complaint after the agency has made the assignment without use of
competitive procedures as required by OPM regulations. OPM's
interpretation of 5 CFR 335.103 continues to be that agencies covered
by this regulation must apply competitive procedures for the purpose of
implementing time-limited promotions in excess of 120 days, whether the
employee is a bargaining unit employee or non-bargaining unit
employees. As discussed in more detail in the preamble for ``Section
335.103--Agency Promotion Program,'' other third parties may have
reason to make a determination on such matters.
In the following sections, we address the public comments related
to the specific portion of the regulation to which each comment
applied.
Part 335--Promotion and Internal Placement
Part 335 addresses promotions and internal placement in the
competitive service. The authority citation provided in the proposed
rule did not reflect the addition of ``Public Law 114-47, sec. 2(a)
(Aug. 7, 2015), as amended by Public Law 114-328, sec. 1135 (Dec. 23,
2016), codified at 5 U.S.C. 9602,'' which was made by the Appointment
of Current and Former Land Management
[[Page 60294]]
Employees final rule published on December 6, 2023 (88 FR 84685). OPM
also notes that several authority citations were inadvertently removed
in that final rule. The updated authority citation in this final rule
reinstates the inadvertently deleted authorities, which were provided
in the proposed rule, and includes the Land Management appointment
authority.
Subpart A--General Provisions
Section 335.103--Agency Promotion Program
In this section, OPM proposed to amend Sec. 335.103 by adding a
new paragraph (c)(2)(iii) to read, ``Retroactive temporary promotions
to higher-graded positions pursuant to a final order by an arbitrator,
adjudicative body or court.'' This proposed language would require
agencies to pay an employee who has been found to have been
noncompetitively, temporarily detailed to a higher-graded position at
the higher grade even for a period of time that exceeds 120 days,
pursuant to a final order by an arbitrator, adjudicative body, or
court. As previously noted, this regulatory change would also apply to
any employee, including non-bargaining unit employees, pursuant to a
final order by an adjudicative body or court unrelated to procedures
found in a collective bargaining agreement. For example, an employee
may file a complaint with the Equal Employment Opportunity Commission
alleging discrimination on matters related to a temporary promotion
exceeding 120 days. Finally, as previously discussed, this is limited
to situations where an employee meets qualification and time-in-grade
requirements established by OPM regulations and the agency made the
assignment without use of competitive procedures.
A Federal agency commented that it does not challenge OPM's
proposed change and concurs that, where a collective bargaining
agreement provides for a retroactive temporary promotion, the
regulation should not limit the promotion to 120 days. Comment 0017.
However, the agency expressed significant concerns that the proposed
language would not allow an agency to settle grievances where an
employee correctly claims that he or she has been temporarily,
noncompetitively assigned to a higher-graded position for longer than
120 days and where the collective bargaining agreement or some other
document requires the higher compensation. The agency noted that the
current language prevents an agency and a union from resolving a
grievance at the lowest possible level and would force the union to
invoke arbitration resulting in monetary outlays and lost productivity
by both parties for an issue not in dispute. The agency stated these
limitations unnecessarily impact the agency's mission and budget as
well as negatively impact the labor-management environment. The agency
encouraged OPM to modify the proposed rule to allow for agency
settlements, with backpay. Specifically, the agency suggested OPM
include a definition of ``adjudicative body'' to avoid any confusion as
to who can direct the monetary award.
OPM notes the proposed rule was never intended to prevent agencies
from entering into lawful settlement agreements before a grievance or
complaint, informal or formal, was filed with an outside third party.
Yet, OPM agrees that the term ``adjudicative body'' may not be clear on
its face and could cause confusion when parties are applying it.
Therefore, OPM will revise the language to be consistent with other
situations where the Back Pay Act, 5 U.S.C. 5596, is applied.
OPM's Back Pay Act regulations are found in subpart H of 5 CFR part
550. Specifically, 5 CFR 550.801 notes that the Back Pay Act authorizes
the payment of back pay, interest, and reasonable attorney fees for the
purpose of making an employee financially whole (to the extent
possible) when, on the basis of a timely appeal or an administrative
determination (including a decision relating to an unfair labor
practice or grievance), the employee is found by an appropriate
authority to have been affected by an unjustified or unwarranted
personnel action that resulted in the withdrawal, reduction, or denial
of all or part of the pay, allowances, and differentials otherwise due
to the employee. Furthermore, 5 CFR 550.803 defines ``appropriate
authority'' as an entity having authority in the case at hand to
correct or direct the correction of an unjustified or unwarranted
personnel action, including (1) a court, (2) the Comptroller General of
the United States, (3) the Office of Personnel Management, (4) the
Merit Systems Protection Board, (5) the Equal Employment Opportunity
Commission, (6) the Federal Labor Relations Authority and its General
Counsel, (7) the Foreign Service Labor Relations Board, (8) the Foreign
Service Grievance Board, (9) an arbitrator in a binding arbitration
case, and (10) the head of the employing agency or another official of
the employing agency to whom such authority is delegated.
With this in mind, OPM will amend the new paragraph (c)(2)(iii) to
read as follows: ``A retroactive temporary promotion to a higher-graded
position pursuant to a determination by an appropriate authority as
defined in 5 CFR 550.803.'' This revision not only covers the third
parties specifically identified in the proposed rule but would permit
agencies to make settlement agreements where appropriate.
The same Federal agency also recommended the regulatory language be
revised to elaborate on what a collective bargaining agreement does or
does not require as relevant to this issue. OPM thanks the commenter
for the suggestion but is not making any changes based on this
recommendation. OPM does not believe it is necessary to add regulatory
language about collective bargaining agreements. Agencies and unions
already have decades of experience resolving negotiated grievances
regarding interpretation and application of collective bargaining
agreements. If an arbitrator determines a collective bargaining
agreement has been violated regarding a time-limited promotion, the
arbitrator is essentially determining that an unjustified or
unwarranted personnel action has occurred. Likewise, an agency official
with the authority to enter into settlement agreements regarding
negotiated grievances can make a determination that an unjustified or
unwarranted personnel action has occurred. This can and already happens
today without specific regulatory language discussing what collective
bargaining agreements can and cannot do in this situation or other
employment situations that are subjects of negotiated grievances.
Therefore, OPM is not revising the regulatory language based on this
comment.
Even with the revisions to paragraph (c)(2)(iii), OPM's
interpretation of 5 CFR 335.103 will continue to be that agencies
covered by this regulation must apply competitive procedures for the
purpose of implementing temporary promotions in excess of 120 days.
This is consistent with the wording of regulatory language that has
existed for decades. OPM believes requiring competition for these
opportunities when they exceed 120 days supports merit system
principles at 5 U.S.C. 2301 and provides greater job opportunities to
the workforce.
As discussed in the proposed rule and repeated in this final rule,
the merit system principles (MSPs) \11\ are nine basic standards that
govern the management of the executive branch
[[Page 60295]]
workforce and serve as the foundation of the Federal civil service. The
U.S. Merit Systems Protection Board (MSPB) has noted the general themes
of the MSPs and prohibited personnel practices \12\ are: (1) Fairness--
treating employees fairly in all aspects of their employment; (2)
Protection--refraining from misuse of authority and protecting
employees from harm, such as reprisal for the exercise of a legally
protected right; and (3) Stewardship--managing employees in the short-
term and long-term public interest.\13\ For example, MSP #1 provides
that recruitment should be from qualified individuals from appropriate
sources in an endeavor to achieve a work force from all segments of
society, and selection and advancement should be determined solely on
the basis of relative ability, knowledge, and skills, after fair and
open competition which assures that all receive equal opportunity. 5
U.S.C. 2301(b)(1). The MSPB has noted MSP #1 ``[f]ocuses on attaining a
well-qualified and representative workforce through open recruitment
and fair, job-related assessment of applicants.'' \14\ Therefore, OPM
continues to believe 5 CFR 335.103 strikes the right balance between
when competitive procedures are necessary and when they are not
necessary, depending on the duration of the time-limited promotion. For
situations where agencies have more immediate, short-term needs of 120
days or less, it is appropriate for agencies to non-competitively
assign higher-graded duties to qualified employees to meet these needs.
For situations where agencies have longer-term needs exceeding 120
days, use of competitive procedures is consistent with the purpose of
MSP #1.
---------------------------------------------------------------------------
\11\ See 5 U.S.C. 2301(b) for the enumerated merit system
principles.
\12\ See 5 U.S.C. 2302: Prohibited personnel practices.
\13\ See The Merit System Principles: Keys to Managing the
Federal Workforce (<a href="http://mspb.gov">mspb.gov</a>), October 2020, available at <a href="https://www.mspb.gov/studies/studies/The_Merit_System_Principles_Keys_to_Managing_the_Federal_Workforce_1371890.pdf">https://www.mspb.gov/studies/studies/The_Merit_System_Principles_Keys_to_Managing_the_Federal_Workforce_1371890.pdf</a>.
\14\ Id.
---------------------------------------------------------------------------
Notwithstanding the addition of the new paragraph (c)(2)(iii), OPM
reminds agencies that they should not assign employees to perform
higher-graded duties for periods exceeding 120 days such that the
employee has been effectively detailed to a higher-graded position
without following applicable competitive procedures. Under this final
regulation, agencies are reminded that they may be required to provide
higher compensation as a result of a determination by an appropriate
authority as defined in 5 CFR 550.803 and discussed in greater detail
above.
OPM also reminds agencies, subject to the requirements of 5 CFR
part 335, that competitive procedures should always be followed if the
agency anticipates the assignment of higher-graded duties may exceed
120 days. If the agency incorrectly anticipates the assignment of
higher-graded duties will last 120 days or less but later determines
the need exceeds 120 days, the agency must follow competitive
procedures for assignment of such duties beyond 120 days for any
particular employee or assign the higher-graded work to another
qualified employee, up to, but not exceeding 120 days. Finally, OPM
reminds agencies to consider this when negotiating new collective
bargaining agreement provisions regarding temporary promotions.
Collective bargaining agreements must be consistent with requirements
in Government-wide regulations on this matter. To be clear, newly
negotiated collective bargaining agreements that allow non-competitive
temporary promotion exceeding 120 days must be disapproved in agency
head review for not complying with government-wide regulations.\15\
---------------------------------------------------------------------------
\15\ 5 U.S.C. 7114(c) provides that ``(1) An agreement between
any agency and an exclusive representative shall be subject to
approval by the head of the agency.'' and ``(2) The head of the
agency shall approve the agreement within 30 days from the date the
agreement is executed if the agreement is in accordance with the
provisions of this chapter and any other applicable law, rule, or
regulation (unless the agency has granted an exception to the
provision).''
---------------------------------------------------------------------------
Finally, OPM reminds agencies that 5 CFR part 335 does not apply to
positions in the Excepted Service. Therefore, the 2004 OPM advisory
opinion and the various FLRA decisions on this matter are not
applicable to the issue of when competitive procedures must be followed
for time-limited promotions in the Excepted Service. Still, agencies
with employees in the Excepted Service are subject to Merit System
Principles and should be mindful of these principles when assigning
Excepted Service employees the duties of a higher-graded position.
These agencies often have bargaining unit employees who may be covered
by collective bargaining agreement provisions outlining when an
employee should receive a time-limited promotion.
III. Regulatory Analysis
A. Statement of Need
OPM is issuing this final rule for two purposes. First, OPM reminds
agencies that competitive procedures must be followed when assigning
duties of a higher-graded position to employees for a period of time
exceeding 120 days. Second, in recognition that there continue to be
situations where competitive procedures are not followed by agencies
subject to 5 CFR part 335, this rule provides the possibility of
remedial relief to bargaining unit employees covered by collective
bargaining agreements requiring temporary promotions and to non-
bargaining unit employees when an appropriate authority makes a
determination to provide a retroactive time-limited promotion, usually
in response to a grievance or complaint.
OPM's interpretation that competitive procedures must be followed
for temporary promotions exceeding 120 days has not changed from what
was stated in the proposed rule. Notwithstanding OPM's interpretation
of these requirements in 5 CFR 335.103, however, OPM agrees that
employees should be compensated accordingly when an agency has been
found to be out of compliance with requirements of a collective
bargaining agreement. Furthermore, OPM's 2004 advisory opinion should
not be cited as a basis for agencies to disregard, whether
intentionally or unintentionally, Government-wide regulations on use of
competitive procedures and collective bargaining agreement requirements
regarding temporary promotions for performing duties of a higher-graded
position. Therefore, OPM has modified 5 CFR 335.103 to address these
scenarios.
This modification reinforces the President's recognition that
Federal civil servants' rights deserve to be protected. President Biden
has stated that ``[c]areer civil servants are the backbone of the
Federal workforce, providing the expertise and experience necessary for
the critical functioning of the Federal Government. It is the policy of
the United States to protect, empower, and rebuild the Federal
workforce.'' Executive Order 14003, Protecting the Federal Workforce
(86 FR 7231, Jan. 22, 2021). As NTEU stated in its petition to OPM, it
supports merit-based competition for long-term promotions or details to
positions that are properly classified at a higher grade to ensure that
the merit system principles of fair and open competition are met.
NTEU also noted that ``[i]n practice, many of these cases arise
where higher-graded duties are assigned to employees on a different,
lower-graded position description, due to staffing shortages, budget
constraints, retirements, etc. Agency managers, who are often tasked
with delivering the agency's mission without the resources to do so,
simply assign the higher graded work to
[[Page 60296]]
whomever is available and convenient.'' NTEU noted that ``these
employees are precluded from any remedial relief beyond 120 days--not
because the inequity has ceased to exist, but because the relevant
regulation has been reinterpreted since 2004 to undermine, rather than
strengthen, merit system principles.'' OPM believes this final rule is
a reasonable solution to address those situations where an agency has
assigned higher-graded duties to an employee without using competitive
procedures, a collective bargaining agreement requires a temporary
promotion, and an appropriate authority has determined a retroactive
promotion is an appropriate remedy. Likewise, OPM believes this final
rule provides a reasonable solution to address similar situations for
non-bargaining unit employees where an appropriate authority, such as
the EEOC, has determined the employee's rights were violated.
B. Regulatory Alternatives
An alternative to this rulemaking is to not issue a regulation and
to continue the possibility of agencies not using competitive
procedures when assigning an employee the duties of a higher-graded
position over 120 days because of an absence of clarification. As a
result, employees may not have an opportunity to be made whole for time
performing higher-graded duties in excess of 120 days even if the
employee challenges the agency action in a grievance or complaint
process. OPM has determined this is not an equitable option. As NTEU
noted, an inequity exists and employees are precluded from any remedial
relief beyond 120 days because the relevant regulation has been
reinterpreted since 2004 to undermine, rather than strengthen, merit
system principles.
Another regulatory alternative is to address this issue through
OPM's oversight function. OPM's statutory responsibility to oversee the
Federal personnel system encompasses assessment of compliance with
merit system principles, and supporting laws, rules, regulations,
executive orders, and OPM standards, as well as the effectiveness of
personnel policies, programs, and operations.\16\ The legal authority
for OPM oversight is 5 U.S.C. 1104(b)(2) and 5 CFR parts 5 and 10.
Under this authority, OPM can evaluate the effectiveness of agency
personnel policies, programs and operations, and agency compliance with
and enforcement of applicable laws, rules, regulations, and OPM
directives. OPM can also direct corrective action where appropriate.
---------------------------------------------------------------------------
\16\ OPM oversight activities--www.opm.gov/policy-data-
oversight/oversight-activities.
---------------------------------------------------------------------------
While OPM can, through its oversight process, identify situations
where an agency is not complying with the requirement to use
competitive procedures for time-limited promotions that exceed 120
days, OPM's enforcement process may not provide timely relief to
employees who are impacted by an agency's failure to follow OPM
procedures on time-limited promotions. Furthermore, based on OPM's 2004
advisory opinion, although OPM may direct, as part of its oversight
process, an agency to follow competitive procedures for time-limited
promotions exceeding 120 days, this would not provide any monetary
relief for employees covered by collective bargaining agreements that
require time-limited promotions and are identified by OPM as having
been given a time-limited promotion where OPM's regulations were not
properly followed.
C. Impact
OPM is issuing this final rule to authorize a retroactive temporary
promotion when a competitive service employee, effectively, has been
detailed or temporarily promoted to higher-graded duties of a higher-
graded position if a collective bargaining agreement requires it and
the employee has been assigned these duties outside of competitive
hiring procedures, as found pursuant to a determination by an
appropriate authority. By authorizing a retroactive promotion in these
situations, OPM affirms that an employee should be paid accordingly for
the entire time performing these duties of a higher-graded position in
certain circumstances, such as when a collective bargaining agreement
requires a temporary promotion and pursuant to an order by an
appropriate authority, such as an arbitrator. In addition, a non-
bargaining unit competitive service employee who is temporarily
promoted to higher grade duties of a higher-graded position should be
paid accordingly for the entire time performing these duties of a
higher-graded position, as found pursuant to a determination by an
appropriate authority.
OPM reminds agencies to use competitive procedures when assigning
an employee duties of a higher-graded position when the assignment
exceeds 120 days. This is not a new requirement and simply reinforces
what agencies, subject to 5 CFR part 335, should already be doing and
should have no impact. In those situations where an agency does not
meet this regulatory requirement, it reinforces the commitment an
agency has already made as part of the collective bargaining process
under 5 U.S.C. chapter 71. It also provides all employees, whether
bargaining unit or non-bargaining unit, an opportunity to be made whole
if an agency does not properly follow employment policies, particularly
those related to temporary promotions, and the employee pursues a
grievance or complaint processes which may be available.
D. Costs
OPM received one comment from an individual commenter regarding the
estimated costs of the proposed rule. Comment 0004. The commenter
stated that OPM's notice assumed a rate of 200% the pay rate but the
commenter believes this rate may be higher (or lower) than the cost of
government civilian manpower. The commenter points to a ``Full Cost of
Manpower'' tool used by the Department of Defense, which the commenter
believes may be more accurate or appropriate for estimations. They
recommended exploring the tool as a basis for any cost estimates.
OPM thanks the commenter for their suggestion but will not be
revising its estimated costs based on this comment. OPM recognizes that
costs may vary by agency and is only providing an estimated Government-
wide cost. OPM cannot estimate costs with great specificity because
they will vary depending on the number of times an agency may assign
higher grade duties to employees that result in a decision on a
grievance or complaint providing a retroactive time-limited promotion.
Each agency will need to consider the potential costs of this final
rule based on their unique circumstances and the practices and tools
used by that agency. The economic assessment is finalized with no
changes other than updates to salary costs based on 2024 average salary
rates.
This rule will affect the operations of approximately 80 Federal
agencies in the executive branch--ranging from cabinet-level
departments to small independent agencies. We do not believe this rule
will substantially increase the ongoing administrative costs to
agencies as this rule leverages existing procedures and requires
agencies to comply with collective bargaining agreements that they have
made with unions (where applicable). Likewise, there may be other
agency policies that impact time-limited promotions. Furthermore, OPM
believes costs will be negligible. Agencies should be able to leverage
existing resources to implement the reminders in this rule and the
regulatory requirements.
[[Page 60297]]
Ultimately, costs are likely to vary from agency to agency since some
agencies have collective bargaining unit agreements with language
regarding the process for detailing bargaining unit employees to a
higher-graded position for more than 120 days. Furthermore, some
agencies are currently already closely adhering to OPM regulations in
Sec. 335.103. Therefore, OPM has determined that finalizing this rule
is not dependent on whether our cost estimate is accurate for any
specific agency. As discussed earlier, OPM believes this final rule is
a reasonable solution to address those situations where an agency has
assigned higher-graded duties to an employee without using competitive
procedures, a collective bargaining agreement requires a temporary
promotion, and an appropriate authority has determined a retroactive
promotion is an appropriate remedy. Likewise, OPM believes this final
rule provides a reasonable solution to address similar situations for
non-bargaining unit employees where an appropriate authority, such as
the EEOC, has determined the employee's rights were violated. At the
same time, the rule supports merit system principles by reminding
agencies to use competitive procedures for time-limited promotions
exceeding 120 days.
With the above in mind, we estimate this rule will require agencies
to review their policies on time-limited promotions subject to 5 CFR
part 335; update these policies if needed; and provide reminders and,
if necessary, training to implement this final rule and reinforce
existing requirements in 5 CFR part 335. For the purpose of this cost
analysis, the assumed staffing for Federal employees performing the
work required by the regulations in Sec. 335.103 is one executive; one
GS-15, step 5; one GS-14, step 5; and one GS-13, step 5 in the
Washington, DC, locality area. The 2024 basic rate of pay for an
executive at an agency with a certified SES performance appraisal
system is $246,400 annually, or $118.06 per hour. For General Schedule
employees in the Washington, DC, locality area, the 2024 pay table
rates are $185,824 annually and $89.04 hourly for GS-15, step 5;
$157,982 annually and $75.70 hourly for GS-14; and $133,692 annually
and $64.06 hourly for GS-13, step 5. We assume that the total dollar
value of labor, which includes wages, benefits, and overhead, is equal
to 200 percent of the wage rate, resulting in assumed hourly labor
costs of $236.13 for an executive; $178.08 for a GS-15, step 5; $151.40
for a GS-14, step 5; and $128.12 for a GS-13, step 5. In order to
comply with the regulatory changes in this final rule and the reminder
in this preamble to follow competitive procedures for time-limited
promotions exceeding 120 days, affected agencies will need to review
and update (if applicable) their policies, procedures and develop
appropriate training or communications to appropriate personnel.
Agencies are reminded to review 5 CFR part 335, agency merit promotion
plans, and related guidance to ensure compliance. Agencies are also
encouraged to communicate with managers, supervisors, and agency staff
who are responsible for completing actions related to part 335. We
estimate that this will require an average of 10 hours of work by
employees with an average hourly cost of $173.43. This would result in
estimated costs of about $1,734 per agency, and about $138,720 in total
government wide. If an agency follows existing requirements to use
competitive procedures for time-limited promotions exceeding 120 days,
there should be no need for employees to file grievances ending in
binding arbitration that could order backpay with interest. To the
extent that grievances are filed and arbitration decisions order
backpay or backpay is provided in other forums, the costs will vary by
agency depending on the number of employees impacted, the salaries of
these employees, and the amount of time performing the higher-graded
duties beyond 120 days.
OPM does not have data to make a determination on potential costs
related to arbitration decisions implementing the proposed regulatory
language. OPM did not receive any comments on the implementation and
impacts of the rule beyond what was discussed above.
E. Benefits
This final rule has several important benefits. First, it supports
merit system principles by reminding agencies to use competitive
procedures for time-limited promotions exceeding 120 days. OPM believes
5 CFR 335.103 strikes the right balance between when competitive
procedures are necessary and when they are not necessary, depending on
the duration of the time-limited promotion. OPM believes that fair and
open competition is appropriate for performing duties for a period of
time exceeding 120 days.
On the other hand, OPM also agrees that it is unfair for employees
to be assigned these higher-graded duties and not be compensated
accordingly when assignment of these duties exceeds 120 days and a
third party awards the employee a retroactive temporary promotion.
Therefore, the second benefit of this rule is that it facilitates
agencies' provision of monetary relief to employees who perform duties
of a higher-graded position for more than 120 days where the agency has
failed to follow the requirements of 5 CFR part 335. OPM expects this
rule to further incentivize agencies to follow proper procedures when
assigning higher-graded duties and to honor the commitment agencies
made in their collective bargaining agreements when they agreed to
temporarily promote employees. This final rule not only reinforces
merit system principles for bargaining unit and non-bargaining unit
employees but reinforces the agency's obligations under the Federal
Service Labor-Management Relations Statute for bargaining unit
employees.
Regulatory Review
Executive Orders 13563, 12866, and 14094 direct agencies to assess
all costs and benefits of available regulatory alternatives and, if
regulation is necessary, to select regulatory approaches that maximize
net benefits (including potential economic, environmental, public
health and safety effects, distributive impacts, and equity). A
regulatory impact analysis must be prepared for major rules with
effects of $200 million or more in any one year. This rule does not
reach that threshold but has otherwise been designated by the Office of
Management and Budget (OMB) as a ``significant regulatory action''
under section 3(f) of Executive Order 12866, as supplemented by
Executive Orders 13563 and 14094.
Regulatory Flexibility Act
The Director of OPM certifies that this rule will not have a
significant economic impact on a substantial number of small entities
because it applies only to Federal agencies and Federal employees.
Federalism
This regulation will not have substantial direct effects on the
States, on the relationship between the National Government and the
States, or on distribution of power and responsibilities among the
various levels of government. Therefore, in accordance with Executive
Order 13132, it is determined that this regulation does not have
sufficient federalism implications to warrant preparation of a
Federalism Assessment.
Civil Justice Reform
This regulation meets the applicable standard set forth in
Executive Order 12988.
[[Page 60298]]
Unfunded Mandates Reform Act of 1995
This rule will not result in the expenditure by state, local, and
tribal governments, in the aggregate, or by the private sector, of $100
million or more in any year and it will not significantly or uniquely
affect small governments. Therefore, no actions were deemed necessary
under the provisions of the Unfunded Mandates Reform Act of 1995.
Congressional Review Act
The Office of Information and Regulatory Affairs in the Office of
Management and Budget has determined that this rule does not satisfy
the criteria listed in 5 U.S.C. 804.
Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3521)
This regulatory action will not impose any reporting or
recordkeeping requirements under the Paperwork Reduction Act.
List of Subjects in 5 CFR Part 335
Government employees.
Office of Personnel Management.
Kayyonne Marston,
Federal Register Liaison.
Accordingly, for the reasons stated in the preamble, OPM amends 5
CFR part 335 as follows:
PART 335--PROMOTION AND INTERNAL PLACEMENT
0
1. The authority citation for part 335 is revised to read as follows:
Authority: 5 U.S.C. 2301, 2302, 3301, 3302, 3304(f), 3330,
9602; sec. 511, Pub. L. 106-117, 113 Stat. 1575; E.O. 10577, 3 CFR,
1954-1958 Comp., p. 218; E.O. 11478, 3 CFR, 1966-1970 Comp., p. 803,
unless otherwise noted; E.O. 13087, 3 CFR, 1998 Comp., p. 191; E.O.
13152, 3 CFR, 2000 Comp., p. 264; and 5 CFR 2.2 and 7.1.
Subpart A--General Provisions
0
2. Amend Sec. 335.103 by:
0
a. Removing the word ``and'' at the end of paragraph (c)(2)(i);
0
b. Removing the period at the end of paragraph (c)(2)(ii) and adding
``; and'' in its place; and
0
c. Adding paragraph (c)(2)(iii).
The addition reads as follows:
Sec. 335.103 Agency promotion programs.
* * * * *
(c) * * *
(2) * * *
(iii) A retroactive temporary promotion to a higher-graded position
pursuant to a determination by an appropriate authority as defined in 5
CFR 550.803.
* * * * *
[FR Doc. 2024-16030 Filed 7-24-24; 8:45 am]
BILLING CODE 6325-39-P
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</html>Indexed from Federal Register on July 25, 2024.
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