**BONNEVILLE POWER ADMINISTRATION**

**HUMAN CAPITAL MANAGEMENT**

**Portland, Oregon**

**PERSONNEL LETTER NO. 531-2 DATE:** March 19, 2008

**SUBJECT:** Advanced In-Hire Rate (Appointments Above the Minimum Rate
of the Grade Because of Superior Qualifications)

**PURPOSE**

This Personnel Letter --

-   Describes the requirements and procedures for using the superior
    qualifications appointment authority to establish starting rates of
    pay above the minimum rates established for grade levels.

-   Supersedes PL 531-2 dated February 28, 2001

**POLICY SUMMARY**

The Bonneville Power Administration may appoint new employees at
salaries above the first step (but not above the tenth step) based on
the procedures and approval process described below. These appointments
are commonly called superior qualifications appointment.

Advance In-Hire Rates are a staffing tool that must not be automatically
offered. Consideration should be given to a recruitment bonus instead of
using this option if at all possible. A decision to use the advance
in-hire option is made on the basis of either a special agency need or
when the selected candidate's qualifications are above that expected of
a well-qualified candidate. The use of this incentive must be approved
by the Chief Human Capital Officer (CHCO) prior to the individual's
actual date of entry into the position.

I.  **RESPONSIBILITIES**

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A.  **Chief Human Capital Officer**, directly or through appropriate
    Human Capital Management (HCM) staff:

-   Develops policies and procedures for implementation, and evaluates
    for effectiveness and use.

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-   Providing advice to Selecting Officials on the use of Advanced
    In-Hire Rates.

## Making final employment offers.

-   Approving the use of an advanced in-hire recruitment option.

#### Selecting Officials conduct initial salary discussion with prospective appointees and gather information about the appointees' qualifications, existing pay, and salary requirements and providing the HCM Customer Service Representative (CSR) the necessary required documentation to ensure that Federal regulations are met. They may not make a firm salary commitment to a candidate.

C.  **Executive or Senior Vice Presidents and/or Vice Presidents**
    recommend approval/disapproval of advanced in-hire rates.

    II. REQUIREMENTS

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A.  Positions may be filled by new appointment or reappointment after a
    90-day break in service. This means that at least 90 calendar days
    must have passed since the candidate last worked for the Government.
    There are several exemptions to the break-in-service requirement,
    which includes conversion of employees serving under the Student
    Career Employment Program. See OPM's Part 531 regulations for more
    information.

B.  Superior qualifications appointment may be used in two types of
    situations:

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1.  When a candidate has superior qualifications. Regulations do not
    provide a definition of superior qualifications, which is basically
    a subjective judgment. Criteria and standards may also vary with the
    situation. For a realistic assessment, the qualities of the
    candidate need to be considered in light of other factors such as:
    Duties of the position; minimum qualifications that may include
    knowledge, skills, abilities, education and experience required for
    employment in the position; and overall quality of candidates
    available in the specialty field. In practical terms, superior
    qualifications generally means that the candidate is so highly
    qualified that to recruit and retain the person, the organization
    needs to set the pay at a higher rate than the minimum step.

2.  When BPA has a special need for the candidate's services. The
    special need criterion is intended for cases in which the candidate
    is not considered to have superior qualifications but which
    nevertheless merits an advanced rate. BPA may have a special need
    for a candidate's services when:

-   The candidate is especially well suited for a unique BPA function or
    project;

-   The candidate's qualifications are too specialized to be
    meaningfully compared to standard qualifications; or

-   The minimum rates for grade levels are substantially lower than
    non-Federal rates for comparable positions and BPA is competitively
    disadvantaged.

> In such cases, it may be necessary to set pay above step 1 in order to
> meet the special needs of BPA.

III. FACTORS FOR CONSIDERATION IN DECIDING WHETHER TO OFFER A SUPERIOR
     QUALIFICATIONS APPOINTMENT

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A.  OPM's regulations require agencies to consider whether it would be
    more appropriate to use a recruitment bonus in deciding whether to
    make a superior qualifications appointment (as well as in
    determining the rate of pay). (Note: If necessary, it is permissible
    to provide both a recruitment bonus and a superior qualifications
    appointment.)

B.  Offers of employment should normally be made at the entry-level rate
    of the grade. In no event should an advance in-hire rate be used
    when the candidate is likely to accept the position at the
    entry-level rate.

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IV. FACTORS FOR CONSIDERATION IN DETERMINING THE ACTUAL RATE TO BE
    OFFERED/ESTABLISHED

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A.  The rate of pay may be set at any step within the pay range for the
    grade. It may not exceed the maximum rate, step 10, for the grade.

B.  The candidate's existing pay must be considered. Usually, a
    candidate's salary requirements are based on current income and
    related factors. The following factors should be considered in
    determining salary requirements:

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1.  The candidate's salary history; and the candidate's current income,
    including salary, salary increases already scheduled, regular
    bonuses, and other regular income; and

2.  The added costs the candidate would incur by taking the position,
    including added costs for benefits, geographic cost of living
    differences, and State and local tax rate differences.

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C.  Advanced in-hire pay rates are a bargaining tool that must not be
    automatically applied. The rate of pay should be high enough to
    attract the candidate who offers the best available talent and
    expertise at the most reasonable cost to BPA. An offer's
    attractiveness will depend not only on the candidate's
    qualifications but also competitiveness of the offer as compared to
    salaries offered by others for such qualifications. A reasonable
    rate of pay from BPA's point of view is one that BPA can afford and
    allows BPA to maintain equitable pay structures.

D.  Other factors to be considered in determining an appropriate rate of
    pay include the candidate's value to BPA, labor market factors,
    internal equity, and budget considerations.

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1.  Value to BPA -- This assessment may be based on such indicators as:
    relevant education beyond what is expected; exceptional work
    experience; professional or academic leadership; special knowledge,
    skills, or abilities that uniquely equip the candidate to meet a
    specific BPA need; or other credentials not commonly available in
    BPA.

2.  Labor Market Factors -- The following labor market factors should be
    considered: scarcity of qualified candidates; demand for the
    candidate's services by other employers; and differences in Federal
    and non-Federal pay levels for the position.

3.  Internal Equity -- It is advisable to consider the equity between
    the pay of the new appointee and that of current employees doing
    comparable work. Superior qualifications appointments may disrupt
    pay alignments in BPA at the time of hire, as well as in the future.
    In determining an appropriate rate of pay, consideration should
    therefore be given to the following: rates of pay previously
    authorized in similar situations; pay levels of comparable employees
    in BPA; and potential impact on staff morale.

4.  Budget Considerations -- The following should be considered: short-
    and long-term costs associated with the proposed pay level;
    available funding for the position; and impact on future budgets.

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V.  PROCEDURES

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A.  Selecting officials, or anyone else involved in the consideration
    and hiring process, may not make a firm salary commitment to a
    candidate. They may conduct initial salary discussions with
    prospective appointees and gather information about the candidate's
    qualifications, existing pay, and salary desires or requirements.
    They may only inform the prospective appointee that they will seek
    approval for an advanced pay rate.

The selecting official is responsible for initiating and submitting a
memo to the CHCO through their VP that documents the justification for
the advance in-hire incentive. The memo will contain the following:

-   The name of the individual selected for the position;

-   Vacancy announcement number and start/ending dates

-   Area of consideration used for recruitment;

-   The rate of pay being requested;

-   A statement demonstrating the selected candidate's superior
    qualifications above what would be expected of a well qualified
    candidate for the position, or,

-   The special need of the activity that justifies the use of this
    incentive;

-   A comparison of the selected candidate's qualifications with those
    of each applicant on the referral list based on superior
    qualifications;

-   Documentation regarding the selectee's current income or other job
    offer if used as a factor in requesting the advanced in-hire rate of
    pay;

-   A statement addressing the reasons for requesting an advance in-hire
    instead of a recruitment bonus.

> Each request will be evaluated based on its merits

B.  Candidates must be cautioned against resigning from or otherwise
    terminating current employment or turning down a firm offer of other
    employment until the proposed pay rate is approved by the CHCO or
    his/her representative and a firm offer is made by BPA.

C.  Executive Vice Presidents, Senior Vice Presidents, or Vice
    Presidents will approve or disapprove the selecting official's
    request and submit the memo to the CHCO, along with other selection
    documentation material.

D.  The CHCO approves or disapproves the justification within a 24 hour
    turn-around time. Should the CHCO concur with providing the advance
    in-hire incentive, s/he notifies the HCM CSR, who makes the formal
    job and salary offer to the candidate. The CHCO also notifies the VP
    of the actions taken.

E.  The memorandum is filed on the left side of the employee's Official
    Personnel Folder.

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VI. REFERENCES

-   Title 5, United States Code 5333(a)

-   5 Code of Federal Regulations, Part 531

-   Personnel Letter No. 575-2, Recruitment Bonuses, Relocation Bonuses,
    and Retention Allowance for Annual Employees

Guy Kyle

Acting Chief Human Capital Officer