Recruitment, Relocation, and Retention Incentive Pay and Supervisory Differentials

TABLE OF CONTENTS

OVERVIEW

9.1 What is the purpose of this chapter? This chapter describes requirements and responsibilities for administering recruitment, relocation, and retention incentive pay as well as supervisory differentials in the U.S. Fish and Wildlife Service (Service).

9.2 What is the scope of this chapter? This chapter applies to permanent, temporary, term, seasonal, full-time, and part-time positions that are eligible for incentives and supervisory differentials. The Office of Personnel Management (OPM) issued Governmentwide regulations that approved most categories of non-General Schedule (GS) employees as being eligible to receive incentives and supervisory differentials. Eligible positions include most Service positions, including all GS, Senior Executive Service, Senior-level, and Prevailing Rate positions. However, certain executive positions (5 U.S.C. 5753(a)(2) and 5754(a)(2)) are excluded by law.

9.3 What is the overall policy? The Service policy is to provide recruitment, relocation, and retention incentives and to pay supervisory differentials when necessary to meet the Service’s organizational needs in compliance with this chapter. These pay authorities allow the Service to give additional payments over and above basic pay to employees.

A. Recruitment incentive pay is used to incentivize the recruitment of a new employee.

B. Relocation and retention incentive pay is used to incentivize the relocation and retention of current employees.

C. Supervisory differentials are used to correct a salary inversion that occurs when a GS supervisor is paid less than the employees they supervise. 

9.4 What are the authorities for this chapter? The authorities for this chapter are the regulations at5 CFR 575, subparts A, B, C, and D, Recruitment, Relocation, and Retention Incentives; Supervisory Differentials.

9.5 What terms do you need to know to understand this chapter?

A. Aggregate limitation on pay. The limit under title 5, U.S. Code, of the total amount of allowances, differentials, bonuses, awards, or other similar payments an employee may receive in a calendar year, when combined with the employee’s basic pay. See also OPM’s Fact Sheet: Aggregate Limitation on Pay.

B. Approving official.  An individual who has the authority to approve the incentive.

C. Basic pay. For the purpose of calculating incentives, an employee’s rate of basic pay is the rate of pay that includes any applicable special rate or locality payment. Additional pay of any other kind is not included.

D. Competencies. The knowledge, skills, abilities, behaviors, and other characteristics an employee needs to perform the duties of a position.

E. Continuing pay. The aggregate of all continuing payments and annual premium pay an employee receives at any time.

F. Likely-difficult-to-fill position.A position is considered to be likely difficult to fill when it is probable that the outcome of a hiring or placement effort will result in a candidate pool of insufficient quality, quantity, or quality and quantity to meet the organizational needs as decided by the approving official (based on the factors as outlined in section 9.15 of this chapter). “Likely difficult to fill” does not require proof of absolute inability to fill.

G. Requesting official. The supervisor or manager who starts a request for an incentive or supervisory differential.

H. Recruitment incentive. A monetary payment given to a newly appointed employee (or group of employees) who is/are filling a position that the Service has determined is likely to be difficult to fill in the absence of an incentive.

I. Relocation incentive. Amonetary payment given to a current employee (or group of employees) who mustrelocate to a different geographic area to accept a position that the Service has determined is likely to be difficult to fill in the absence of an incentive.

J. Retention incentive. A monetary payment given to a current employee (or group of employees) when the Service has determined that the unusually high or unique qualifications of the employee(s) or a special need of the agency for the employee's/employees’ services makes it essential to keep the employee(s) and that the employee(s) would likely leave the Federal service in the absence of a retention incentive.

K. Salary compression. When there is little difference in pay between team members, despite differences in things like skills and experience.

L. Salary inversion. When the starting salaries for new employees increase faster than those for existing employees.

M. Supervisor. A Service employee who has the authority to hire, direct, assign, promote, reward, transfer, furlough, lay off, recall, suspend, discipline, or remove employees; to adjust their grievances; or to effectively recommend such action.

N. Service agreement. A written agreement, signed by the employee prior to receiving an incentive pay, that specifies the service period and other terms and conditions required for the employee to receive the incentive pay.

O. Service period. The period of service required by the service agreement, which must not be less than 6 months and must not exceed 4 years. Service periods begin on the first day of a pay period and end on the last day of a pay period.

RESPONSIBILITIES

9.6 Who is responsible for the incentive program?

Table 9-1: Responsibilities for the Incentive Program

INCENTIVES PROGRAM

9.7 What is the general incentive program plan?

A. Regulations require that we use pay incentives in connection with a recruitment, relocation, and retention incentives plan. This policy clarifies Governmentwide regulations, supplements Departmental guidance, and establishes the Service’s incentives plan. The plan uses pay incentives to address known and expected workforce gaps and to increase the applicant pool of difficult-to-fill positions.

B. The requesting official, in coordination with Human Resources professionals, will develop a justification and request for the use of an incentive through Human Resources Operations staff and direct it to the proper approving official. As with all supplemental guidance, Human Resources professionals must review all applicable guidance (e.g., the Code of Federal Regulations, OPM Fact Sheets, and Departmental Personnel Bulletins) when considering a pay incentive request.

C.  Discretionary incentive pay authorities are used only when it is in the best interest of the Government. An incentive may not be used to address position classification shortcomings and may not be based on inappropriate justifications.

D. The provisions of this chapter will be applied uniformly.

9.8 What are the incentive program requirements?

A. Approval of any incentive payment requires a written justification documenting that the incentive was offered, accepted, and approved prior to the effective date of the employee’s entry on duty into the position for which the incentive has been authorized. Requesting officials must make a request for an incentive to the proper approving official. The written justification for an incentive must satisfy the regulatory requirement to document and justify the use of the incentive. Managers interested in using these authorities should not make an oral offer to pay a recruitment or relocation bonus until after formal approval is obtained.

B. Proper justifications are standalone written documents that are specific to the circumstances; they supply clarity, support, and details. Justifications must:

(1) Adhere to the principle that similarly situated employees must be treated equally,

(2) Use reliable sources of data (Human Resources Operations staff will supply, when requested, data on recruitment, relocation, and retention efforts), and

(3) Result from strategic workforce planning.

C. Requesting officials must send the request through the Service’s Human Resource Operations staff via mySupport prior to submission to the approving official for concurrence and approval. Human Resources Operations will provide procedures for submitting or reviewing requests.

D. Human Resources professionals must advise management officials on compensation decisions sufficient to ensure the Service is not creating unfounded pay disparities. We view compensation packages holistically when extending a package in connection with a hiring or placement action. A compensation package may include:

(1) Setting pay at higher than the minimum step based on superior qualifications and special needs;

(2) Using highest previous rate and maximum pay rate rules;

(3) Leave credit for non-Federal time and certain military time;

(4) Recruitment, relocation, or retention incentives; and

(5) Student loan repayment.

E. Biweekly or annual premium pay limitations do not apply to the incentives program because they are not considered premium pay.

F. Directorate members (the designated approving officials) must review the current workforce composition to decide the degree to which an incentive pay may create a salary compression or inversion. Incentive increases do not affect basic pay and may be preferable to other pay flexibilities that change basic pay or basic compensation.

G. Approving officials have the final authority to determine the minimal incentive amounts necessary to successfully recruit, relocate, or retain an employee. Deciding the appropriate amount of an incentive is critical to overall success of the organization. Organization managers are to devise effective employee recruitment, relocation, and retention strategies that include promoting employee engagement, employee motivation, and fair treatment.

H. Approving officials when using these authorities will:

(1)  Evaluate the totality of paid and unpaid compensation,

(2)  Make decisions based on fair and nondiscriminatory reasons,

(3)  Adhere to the merit system principles,

(4) Maintain the confidentiality of the pay setting process, and

(5)  Promote the principle of fair and equitable pay.

I. Human Resources Operations will maintain all records related to the approval or disapproval of recruitment, relocation, and retention incentives. The records will allow for the reconstruction of the action taken and must adhere to any applicable recordkeeping requirements, to include temporarily maintaining the original signed service agreement in the employee’s Official Personnel File until completion of the required service. For recordkeeping requirements, see the Service’s records disposition schedule.  

J. All individual and group-based incentives are subject to regular and periodic evaluation and review through the Service’s Human Capital Assessment and Accountability Program.

9.9 What are the recruitment incentive program requirements?

A. Managers may use a recruitment incentive for a newly appointed employee (as defined in 5 CFR 575.102) who is being appointed to a position that has been determined to be difficult to fill without an incentive.

B. Regulations prohibit using recruitment incentives to attract current Federal employees.

C. Recruitment incentives may be used in combination with other pay flexibilities. Requesting officials should review all pay flexibilities and discuss with a Human Resources professional the advantages and disadvantages of granting a recruitment incentive alone or in combination with other pay flexibilities.

D. A recruitment incentive may be offered to an individual who is rated or determined to be qualified. Since the position is difficult to fill, it would burden the Service for this policy to extend past regulatory requirements and insist that recruitment incentives only be used when an individual is “highly qualified.” The qualification of an individual may inform the decision to pay an incentive, set the amount of an incentive, or use other pay setting authorities instead of or along with the recruitment incentive.

E. An employee is generally expected to cover the expense of travel to the first official duty station unless first post of duty allowances/relocation expenses are authorized. A recruitment incentive is not used to avoid this requirement. Managers must not use expenses considered to be the employee’s responsibility to justify the expenses of an incentive. (i.e., it would be improper for a manager to approve an incentive amount to cover the cost of an airplane ticket to report to work, although it may be proper to approve an incentive amount to offset the personal disruption accepting the job offer may cause).

F. We calculate and approve incentives payments as a percentage of the employee’s rate of basic pay (which includes locality, a special rate, or locality and a special rate). We pay recruitment incentives using one of the following methods:

(1) A single lump sum at the beginning of the service period;

(2) A single lump sum at the completion of the full-service period;

(3) Installments, either equal or variable, throughout the service period; or

(4) A combination of these payment methods.

G. The amount of a recruitment incentive may be up to 25 percent of an employee’s annual rate of basic pay in effect at the start of the service period, multiplied by the number of years (including fractions of a year) in a service agreement, not to exceed 4 years. The Service can make a request to OPM to waive this threshold. If approved by OPM,recruitment incentives may be up to 50 percent of an employee’s annual rate of basic pay per year as long as the total incentive, over the length of the service agreement, does not exceed 100 percent of the employee’s annual rate of basic pay at the beginning of the service period.

H. Payment of a recruitment incentive is subject to the aggregate pay limitations on pay under 5 CFR 530, and must not be authorized if it is estimated that when added to the employee’s likely aggregate pay, it would cause the aggregate compensation actually received during the calendar year to exceed the aggregate pay cap. Incentive payments are not part of the employee’s rate of basic pay for pay adjustments and retirement pay.

I. Requesting officials must develop a written justification that, per 5 CFR 575.108, at a minimum explains:

(1) The employee’s (or group of employees’) eligibility for an incentive,

(2) How we determined the position was likely difficult to fill without an incentive (see section 9.15),

(3) Why the incentive is in the best interest of the Service,

(4) How the percentage amount of the meaningful monetary incentive was determined (see section 9.16),

(5) What the length of the service period is and why the length of any applicable service agreement is proper (see section 9.17), and

(6) How we determined the method of payment to be proper.

J. Requesting officials must develop justifications using plain language. Avoid passive constructions and clearly state all decisions made, e.g., declaring that you have determined, based on the analysis provided, that the position will likely be difficult to fill.

K. In deciding to pay an incentive award, officials should give due weight to the degree the position is critical to the mission of the organization.

L. We may use recruitment incentives in connection with competitive and noncompetitive recruitment actions.

M. Managers requesting recruitment incentives must make the request to pay the incentive before the job is accepted and an entry on duty date is established. After the selection is made and approved, Human Resources Operations will notify the nominating official to complete the service agreement and forward to them for processing. An employee selected to receive a recruitment incentive must sign a service agreement stating the terms, limitations, or conditions of service prior to receiving any payments.

N. Determinations on the payment or nonpayment of recruitment incentives or the termination of recruitment incentives in process are final. Employees do not have the right to appeal or grieve determinations.

O. Human Resources Operations will enter the amount or percentage of payment, the frequency of payment, and the date of the last payment into Federal Personnel Payroll System (FPPS). The “Frequency Indicator Codes” are listed in the FPPS Data Dictionary and in the FPPS tables (see command TBLS).

9.10 What are the relocation incentive program requirements?

A. Managers may use a relocation incentive for a current Federal Government employee who must relocate to a different geographic area (i.e., duty station) permanently or temporarily, without a break in service, to accept a position that has been determined to be difficult to fill.

B. Relocation incentives are used in connection with Service-established duty stations and not remote work positions, because remote work is an arrangement under which an employee is not expected to report to an agency worksite on a regular and recurring basis—for remote workers, the remote work location is their official duty station (e.g., their home). A relocation incentive may be used, however, in the rare circumstance where one or more duty stations are available. For example, a relocation incentive may be used for a shared position between two National Wildlife Refuges, where the established duty station will be one of the two refuges.

C. Regulations only require that individuals be “qualified” and not “highly qualified.” The Division of Human Capital, however, recommends using relocation incentives when an individual is “highly qualified” or has unique skills applicable to the position to be filled.

D. We may only pay relocation incentives when the employee’s most recent performance appraisal is at least “fully successful” or equivalent.

E. For us to consider a move to be in a “different geographic area,” the duty station of the new position must be 50 or more miles from the duty station of the position held immediately before the move. If an employee must move to accept a position and the position’s duty station does not meet the 50-mile requirement, the Director may waive this requirement.

F. We calculate relocation incentives as a percentage of the employee’s rate of basic pay (which includes locality, a special rate, or locality and a special rate). We pay relocation incentives using one of the following methods:

(1) A single lump sum at the beginning of the service period;

(2) A single lump sum at the completion of the full-service period;

(3) Installments, either equal or variable, throughout the service period; or

(4) A combination of these payment methods.

G. The amount of a relocation incentive may be up to 25 percent of an employee’s annual rate of basic pay in effect at the start of the service period, multiplied by the number of years (including fractions of a year) in the service period, not to exceed 4 years. The Service can make a request to OPM to waive the thresholds. If approved by OPM,relocation incentives may be up to 50 percent of an employee’s annual rate of basic pay, as long as the total incentive does not exceed 100 percent of the employee’s annual rate of basic pay at the beginning of the service period.

H. Payment of a relocation incentive is subject to the aggregate pay limitations on pay under 5 CFR 530, and must not be authorized if it is estimated that when added to the employee’s likely aggregate pay, it would cause the aggregate compensation received during the calendar year to exceed the aggregate pay cap.

I. We may use relocation incentives in competitive and noncompetitive recruitment actions.

J. Requesting officials will develop a written justification that, per 5 CFR 575.208, at a minimum explains:

(1) The employee’s (or group of employees’) eligibility for an incentive;

(2) How we determined the position was likely difficult to fill without an incentive (see section 9.15);

(3) Why the incentive is in the best interest of the Service;

(4) How the percentage amount of the meaningful monetary incentive was determined (see section 9.16);

(5) What the length of the service period is and why the length of any applicable service agreement is proper (see section 9.17);

(6) How we determined the method of payment to be proper; and

(7) That the worksite of the employee’s new position is outside the geographic area of the employee’s current worksite, or a request for the Director to waive the 50-mile requirement is included.

K. Requesting officials must develop justifications using plain language. Avoid passive constructions and clearly state all decisions made, e.g., declaring that you have determined, based on the analysis provided, that the position will likely be difficult to fill.

L. The Service will not pay the relocation incentive until the employee has set up a residence in the new location. (Proof of relocation may include a voter registration card, a driver’s license, a State identification card, car registration, a signed residential lease agreement, or a signed home purchase agreement.)

M. Relocated employees must maintain a residence in the new geographic location throughout the entire period of the service agreement.

N. Managers requesting relocation incentives must make the request to pay the incentive before the job is accepted and a report date is established.

O. Human Resources Operations will enter the amount or percentage of payment, the frequency of payment, and the date of the last payment into FPPS. The “Frequency Indicator Codes” are listed in the FPPS Data Dictionary and in the FPPS list of tables (see command TBLS).     

P. When the Service has decided not to authorize a Permanent Change of Station payment, that determination is not a factor in the decision to pay a relocation incentive. However, you can take into consideration the potential for a relocation incentive in the decision to pay a Permanent Change of Station.

9.11 What are the retention incentive program requirements?

A. A retention incentive is paid to a current employee(s), as defined in 5 CFR 575.202, when the Service has determined that the employee(s) has unusually high or unique qualifications, or the organizational unit has a special need for the employee’s services, that makes it essential for the Service to retain the employee, and the employee(s) would be likely to leave Federal service in the absence of a retention incentive.

B. A competing written salary offer (non-Federal) or a written indication that the employee is eligible to voluntarily retire may be used as proof that the employee is likely to leave Federal service and may be considered in determining the amount of a retention incentive; however, it cannot be the sole basis for the retention incentive, and the written offer should not be over 90 days old. The name of the prospective employer along with the specific salary being offered must be included in the justification.  

C. A retention incentive may also be paid to an employee likely to leave the Department for another Federal position before the closure or relocation of the employee’s office, facility, activity, or organization and if there is a special need for the employee’s services.

D. We may only pay retention incentives when the employee’s most recent performance appraisal is at least “fully successful” or equivalent; the employee must have been an employee long enough to have received a rating of record. An interim rating may not be used.

E. Requesting officials must develop a written justification to request a retention incentive (see section 9.13).

F. Requesting officials must annually review the original retention pay determination and decide whether the original determination still applies and should be continued, should be continued with a different amount, or should be stopped. They must submit their recommendation to Human Resource Operations via mySupport for concurrence prior to it being sent to the approving official. Human Resources Operations must keep approvals as part of the ongoing case file.

9.12 How do we calculate and pay retention incentives?

A. We calculate retention incentives as a percentage of the employee’s rate of basic pay. Payment of a retention incentive is subject to the aggregate pay limitations of pay under 5 CFR 530, and must not be authorized (even on a deferred basis) if it is estimated that when added to the employee’s likely aggregate pay it would cause the aggregate compensation received during the calendar year to exceed the aggregate pay cap.

B. We calculate retention incentives as a percentage of the employee’s annual rate of basic pay (including a special salary rate and locality pay), not to exceed 25 percent of the annual rate of basic pay.

C. We also calculate retention incentives for groups or categories of employees as a percentage, not to exceed 10 percent of the basic pay of each employee in the group or category allowed to receive the incentive. When an employee is receiving a retained rate of pay, the maximum rate of basic pay for the employee’s grade/band is used in lieu of the retained rate for calculating the incentive amount.

D. Payments are stopped when an employee is in non-pay status for the entire pay period, since there is no base pay on which to compute the payment. If an employee is in a non-pay status for part of the pay period, we prorate the payment.

E. We pay retention incentives using one of the following methods:

(1) In equal dollar amounts at the full retention incentive percentage rate, or at a reduced rate with the excess deferred for payment at the end of the full-service period (stated in the service agreement) consistent with the biweekly pay periods; or

(2) As a single lump-sum payment after completion of the full-service period required by a service agreement.

F. We cannot pay retention incentives in a single lump sum at the start of the service agreement, nor can we pay the total retention incentive before the service period is completed.

G. We cannot pay a retention incentive during the time established in a service agreement for a recruitment or relocation incentive.

H. We must make the determination to pay a retention incentive on a case-by-case basis, unless making determinations for groups or categories of employees.

I. Unusually high or unique qualifications must be directly relevant to the position to be filled. When assessing qualifications, you are assessing the relative value of an employee’s competencies against the qualifications expected in an applicant pool.

J. A special need of the employees’ services is generally short term and project oriented. Retention incentives are not intended as long-term retention strategies and should not be used as permanent salary adjustments.

K. Payment of a retention incentive is subject to the aggregate pay limitations on pay under 5 CFR 530, and must not be authorized if it is estimated that it would cause the aggregate compensation to exceed the aggregate pay cap.

L. Human Resources Operations will enter a percentage and the frequency of payment and, only when applicable, specify a payment date in FPPS. The ‘Frequency Indicator Codes” are listed in the FPPS Data Dictionary and in the FPPS list of tables (see command TBLS). Note that biweekly payments without a service obligation do not require an end date because they are ongoing payments.

9.13 What are the requirements for written justifications for retention incentives?  Requesting officials must develop a written justification for a retention incentive that:

A. Explains, per 5 CFR 575.308:

(1) The employee’s (or group of employees’) eligibility for an incentive;

(2) The basis for determining that the employee (or group of employees) has unusually high or unique qualifications, or the basis for determining the special need for the employee’s (or group of employees’) services;

(3) The basis for determining that the employee (or a significant number of employees in a group) would likely leave the Federal service in the absence of a retention incentive;

(4) How the percentage amount of the meaningful monetary incentive was determined (see section 9.16);

(5) The length of the service agreement and why it is appropriate (see section 9.17); and

B. Explains, per 5 CFR 575.306 (b), how the decision to pay an individual retention incentive was based on, but not necessarily limited to, the following factors:

(1) Employment trends and labor market factors (this factor is addressing the availability of quality candidates in the labor market with the required competencies, and the ability to perform all of the duties and responsibilities of the employee’s position at the level performed by the employee, with minimal training, cost, or disruption of the service to the public);

(2) 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 (positions are similar when they possess the same duties and responsibilities and the same level of responsibility);

(3) Any special or unique competencies, skills, or training required for the position should be thoroughly described in relation to the organization unit’s work;

(4) Efforts to use non-pay Human Resources flexibilities (e.g., work scheduling options, telework, special training, improved working conditions, etc.) to help retain the employee;

(5) The desirability of the duties (work or organizational environment, geographic location, etc.);

(6) The extent to which the employee’s departure would impair the ability to carry out an activity, perform a function, or complete a project deemed essential. If a retention incentive is based on the determination that an employee will probably retire if we do not pay the incentive, include recruitment and/or succession planning efforts for the position; and

(7) The salary we can expect the employee to make in the private sector, obtained from a reputable organization such as the Bureau of Labor Statistics, and a list of organizations that offer these salaries for that position.

C. Requesting officials must develop justifications using plain language. Avoid passive constructions and clearly state all decisions made, e.g., declaring that you have determined, based on the analysis provided, that the employee has unusually high qualifications and will likely leave Federal service in the absence of a retention incentive.

9.14 What is the group incentive process?

A. Group incentives may be set up when positions are continuously difficult to fill. The approval process for a group incentive mirrors the approval process for individual incentives. However, the need for a group incentive is rare, and coordination in advance with Human Resources Operations is required.

B. Officials considering group retention must narrowly define the targeted group or category of employees by locations, occupation, and grade.

C. Group incentives approvals must be reviewed and approved annually.

9.15 What is a difficult-to-fill determination?

A. Eligibility determinations for relocation and recruitment incentives require that the requesting official, in consultation with a Human Resources professional, determines that the position(s) is likely to be difficult to fill. A determination can apply to a group of positions or be on a case-by-case basis. The regulations for relocation and recruitment incentives are similar and supply two methods for making this determination. The methods for determining a difficult-to-fill determination are:

(1) Factor Evaluation. The evaluation must be in writing and complete. While two sets of regulations cover the incentives (Authorizing a Recruitment Incentive, 5 CFR 575.106(b), and Authorizing a Relocation Incentive, 5 CFR 575.206(b)), they both use the same factors when making a likely-to-be-difficult-to-fill determination. All factors must be addressed and if a factor does not apply, the requesting official must supply an explanation. The following factors must be evaluated when making a likely-to-be-difficult-to-fill determination:

     (a) The availability and quality of candidates having the competencies required for the position. This factor is evaluating the success (or lack thereof) of recent efforts to recruit candidates for similar positions, using indicators such as job offer acceptance rates, the proportion of positions filled, the time required to fill similar positions, and the probable cost of renewed recruitment efforts.

     (b) The salaries typically paid outside the Federal Government for similar positions. This factor is evaluating the non-Federal salary plus any fringe-benefits package the candidate receives or would expect to receive.

     (c) Recent turnover in similar positions. Evaluate this factor by looking at the number and frequency of a work unit’s attrition against expected attrition (i.e., did employees retire or did they leave for career advancement?). Positions are similar if they have similar duties and responsibilities and have a similar level of responsibilities.

     (d) Labor market factors, such as location, comparative salaries, and economy in the area. (A good location compares favorably with other locations and positively affects the ability to recruit qualified candidates.)

     (e) The value of a candidate because of the candidate’s competencies. (Look at the relative value of a candidate's competencies against others in the applicant pool. The value would be high when a candidate scored, or would expect to score, exceptionally high on all rating factors or other assessment.)

     (f) Efforts to use non-pay authorities, such as special training and work scheduling flexibilities, to resolve difficulties alone or in combination with an incentive.

     (g) The desirability of the duties, work or organizational environment, or geographic location of the position.

     (h) Other supporting factors (e.g., a critical need resulting from a project, a mission requirement, etc.).

(2) Demonstrating the existence of an OPM Direct Hire authorization (5 CFR 575.106(c), Authorizing a Recruitment Incentive, and 5 CFR 575.206(c), Authorizing a Relocation Incentive). (See OPM’s list of approved Direct Hire authorizations.)

B. Given the diversity of occupations and various duty locations within the Service, this policy does not supply specific criteria to scale each factor required under section 9.15A(1). The Division of Human Resources will supply requesting officials with specific occupational data upon request, that will be used in making a reasonable assessment of the facts. Requesting officials must show and approving officials must concur that a profound and marked difficulty to fill a position likely exists, understanding that the declination of one of two selections is not equal to the declination of many or most selections.

C. Regulations do not require that job opportunity announcements give public notice that a recruitment or relocation incentive may be paid. However, the best practice in recruiting difficult-to-fill positions would be to inform potential applicants of the flexibility. In cases when no public notice was made about the potential for a recruitment or relocation incentive, the request for an incentive must explain the absences of notice (e.g., the requestor was unaware of the difficulties in filling the position until the certificate was in hand or was unaware of the availability of funds for such a purpose).

D. A difficult-to-fill determination can be made without record of a declination of an initial offer of employment. However, the request for an incentive must explain why (e.g., the recruitment plan identified the position to be difficult to fill and the Service developed a competitive initial offer that included an incentive).

9.16 How is the amount of an incentive determined?

A. Requesting officials make written determinations for the payment of recruitment, relocation, and retention incentives on a case-by-case basis, and payment in one instance does not guarantee payment in similar instances.

B. This policy does not set up standardized percentages for incentives.

C. Requesting officials will set up the monetary incentive as a percentage amount and document the onetime and, if applicable, the aggregate percentage of first-year basic pay. Percentages are based on the employee’s first-year basic pay.

D. To produce a meaningful monetary incentive, officials will undertake a review in writing by considering the workforce planning needs of the office (see 225 FW 1), past practices, Human Resources Operations guidance and advice, and the availability of funds for such a purpose. Human Capital supplies a list of factors that may be used to guide analysis. The factors listed do not apply to all types of incentives. Officials may consider the following factors:   

(1) The degree to which the position is difficult to fill,

(2) The undesirability of the geographic area of the proposed duty station,

(3) The projected cost associated with announcing the position if the candidate does not accept the position,

(4) The urgency of the program from a mission perspective,

(5) The specialized skills the individual has beyond the basic position requirements in the vacancy announcement or position description that will benefit the organization,

(6) The length of service and contribution of the employee while serving at the Department of the Interior,

(7) The estimated cost of recruitment and training associated with replacement of the employee or a renewed recruitment effort,

(8) Outside salaries (e.g., the current non-Federal salary or salary plus fringe benefits that the candidate receives; the average salary reported in published salary surveys for comparable private sector positions, if available; or a competing written non-Federal salary offer),

(9) The documented disparity in the cost of living between the current residence and the proposed duty station,

(10) The personal or professional disruption that a relocation may cause, and

(11) The urgency of the program from a mission perspective.

9.17 How are service agreements established?

A. Service agreements are used to help ensure employees stay with the Service for a specified period. Basic service agreements requirements are:

(1) When a recruitment incentive is authorized, the employee must sign a service agreement with a minimum period of service of 6 months and a maximum incentivized service period of 4 years.

(2) When a relocation incentive is authorized, the employee must sign a service agreement with a minimum period of service of 6 months and a maximum service period of 4 years. If the employee is being relocated and relocation expenses are authorized, then the minimum service period must be at least 12 months to be consistent with the Federal Travel Regulation (FTR) service requirement.

(3) When a retention incentive is authorized, the requirement will depend on the circumstances.

     (a) Regulations do not mandate the service period for retention incentives paid in biweekly installments, and each biweekly payment is at the full retention incentive rate established for the employee under 5 CFR 575.309(a). (See 5 CFR 575.310 (f).)

     (b) We must not pay a retention incentive as an initial lump-sum payment at the start of a service period or before fulfilling the service period for which the employee received the retention incentive. The minimum period of a retention service agreement is 6 months and is generally limited to no longer than 1 year, but can be renewed after being reevaluated annually.

B. This policy does not set up standard lengths of service, but Table 9-2 is provided as a guide. The table is based on the aggregate or total percentage of the incentive. For example, if we pay an employee 25 percent for 2 years, the total incentive would amount to 50 percent of their annual rate of basic pay at the start of the service period.

Table 9-2: Service Year Guide

C. Requesting officials will conduct an analysis to decide the length of a service period, if applicable. Officials may use their determination undertaken as part of section 9.15 to inform this analysis. The analysis must be documented as part of an incentive recruitment, relocation, or retention justification.

D. Requesting officials must send unsigned service agreements to Human Resources Operations via mySupport for review along with any request for approval of an incentive. Human Resources Operations will provide Service agreements that are applicable to the attending circumstances.  

E. The service agreement must include:

(1) The start and end dates of the required service period.

     (a) The required service period must begin with the first day of a pay period and end on the last day of a pay period. The service period begins on the first day of the first pay period beginning on or after the effective date of the appointment for which the employee is receiving the incentive, except as described in (b) below.

     (b) If successful completion of training is necessary for continued employment in the position, the manager can delay the start date of the service agreement until the employee completes an initial period of training.

(2) The total dollar amount of the incentive and the timing and amounts of each incentive payment.

(3) The conditions under which the Service must terminate the agreement.

(4) The conditions under which the employee must repay the incentive.

F. The service agreement may also include the conditions under which the Service would use its discretionary authority to terminate the agreement (any list of conditions is not exhaustive).

9.18 What is the process for terminating a service agreement?

A. The Service may terminate a service agreement based on management needs (e.g., due to insufficient funds to continue planned payments, the need to reassign an employee, or reductions in force). When a termination is based on management needs, the employee is entitled to all payments attributable to completed service and to retain any portion of a payment received or owed that is attributable to uncompleted service, except when an employee’s separation is caused by material, false, or inaccurate statements; deception; fraud in examination or appointment; or because of not meeting employment qualifications.

B. The Service must terminate the service agreement if an employee:

(1) Is demoted,

(2) Is separated for cause (for unacceptable performance or conduct),

(3) Receives a rating of record lower than “fully successful” or equivalent, or

(4) Does not fulfill the terms of the service agreement.

     (a) For a recruitment incentive, service agreement terms typically require service in a specific position or successor position. Failure to meet the terms of a service agreement will occur when an employee leaves the Service before completing the period of employment for the position the service agreement specifies.

     (b) For a relocation incentive, service agreement terms typically require service in a specific position or successor position at the new duty station. Failure to meet the terms of a service agreement will occur when an employee leaves the duty station (i.e., transfers to another duty station or leaves the Service) before completing the period of employment for the position the service agreement specifies.

     (c) For a retention incentive, the service agreement is specific to the position approved for the retention.

C. When an employee does not fulfill the service agreement terms, employees are entitled to keep all incentive payments attributable to completed service and must also repay any portion of the incentive attributable to uncompleted service unless waived under the repayment waiver authority, except when an employee’s separation is caused by material, false, or inaccurate statements; deception; fraud in examination or appointment; or because of not meeting employment qualifications.

D. Other terms and conditions may be included in the service agreement that, if violated, will cause the termination of the agreement. Examples of such conditions include, but are not limited to, work schedule, type of position, and the duties we expect the employee to perform.

E. Calculate completed service or uncompleted service, when applicable, by converting the service period to days. For example, a service period of 26 pay periods equals 364 days. Examples of calculations are provided by the Office of Personnel Management.

9.19 Who approves payment of incentives for members of the Senior Executive Service and senior-level scientific and professional positions? The Executive Resources Board approves recruitment, relocation, and retention incentives for employees in Senior Executive Service or senior-level scientific or professional positions. The Division of Human Capital reviews and coordinates all requests for payment of incentive for members of the Senior Executive Service and senior-level scientific and professional positions.

SUPERVISORY DIFFERENTIAL PROGRAM

9.20 What are the supervisory differential program requirements?

A. A requesting official may request approval to pay a supervisory differential to a GS employee who has supervisory responsibility for one or more civilian employees not under the GS, if:

(1) In the absence of such a differential, the subordinate civilian employees would be paid more than the supervisor; and

(2) The supervisor’s rate of basic pay does not exceed the rate of basic pay established for a GS-15, step 10.

B. A supervisory differential is a pay flexibility that the Service will use only when there is a significant pay disparity between the supervisor’s and the subordinate’s pay. Given the workforce composition of the Service, the need for a supervisory differential is rare and is handled on a case-by-case basis between the Human Resources Officer and the Deputy Human Capital Officer.

C. When deciding whether to pay a supervisory differential and to determine the amount of such a differential, managers must consider the relationship in pay among GS supervisors in the same organizational component, as well as the relationship in pay between the supervisor and the supervisor’s subordinates.

D. We will not pay a supervisory differential when the differential is based on the supervision of an employee whose rate of basic pay exceeds the maximum rate of basic pay for grade GS‑15.

E. The Division of Human Resources Operations will keep records of all documentation related to the approval or disapproval of supervisory differentials. The records must allow for the reconstruction of the action taken and must adhere to any applicable recordkeeping requirements. For recordkeeping requirements, see the Service’s records disposition schedule.