U.S. Department of Transportation

DEPARTMENTAL

PERSONNEL MANUAL

Chapter 430

PERFORMANCE MANAGEMENT

THIS DPM CANCELS AND REPLACES ALL PREVEIOUSLY ISSUED DPM-430 BULLETINS,
LETTERS AND CHAPTERS RELATED TO PERFORMANCE MANAGEMENT.

DEPARTMENTAL PERSONNEL MANUAL 430

PERFORMANCE MANAGEMENT

SECTION 1. GENERAL INFORMATION

Purpose

Coverage

Authority and References

Policy

Definitions

SECTION 2. RESPONSIBILIITIES

SECTION 3. MANAGING FOR SUCCESS

SECTION 4. PROGRAM REQUIREMENTS

SECTION 5. PERFORMANCE PLANS

Development of Performance Plans

Performance Assessment Process

SECTION 6. MANAGING POOR PERFORMANCE

SECTION 7. EMPLOYEE RECOGNITION

SECTION 8. TRAINING

SECTION 9. EVALUATION OF PERFORMANCE MANAGEMENT PROGRAMS

SECTION 10. APPROVALS

APPENDIX A -- INDICATORS OF ACHIEVEMENT FOR MANAGERS AND SUPERVISORS

DEPARTMENTAL PERSONNEL MANUAL 430

PERFORMANCE MANAGEMENT

## SECTION 1. GENERAL INFORMATION

##### Purpose

> This Chapter establishes the U.S. Department of Transportation (DOT)
> Performance Appraisal System. It sets forth performance management
> policy for establishing employee performance appraisal systems within
> DOT. DPM Letter No 430-4, The Department of Transportation Performance
> Management Framework, dated October 12, 1995, containing policy and
> instructions, is canceled. However, operating administrations shall
> continue to use their current performance management systems until new
> performance management programs created under this directive are
> approved for implementation by the Departmental Office of Human
> Resource Management.
>
> **[Coverage]{.underline}**
>
> The DOT Performance Appraisal System applies to all employees employed
> by the operating administrations (OA) of DOT except:

1.  Individuals in the Senior Executive Service (See [DPM 920-24, Senior
    > Executive Service (SES) Performance Management
    > System]{.underline});

2.  Individuals appointed by the President; and

3.  Individuals excluded from coverage under other applicable law.

### Authority and References

> a\. This Chapter is based upon and conforms to the policies and
> requirements set forth in 5 U.S.C. Chapters 23, 43, 45, 53 and 71; and
> 5 C.F.R. Parts 430, 432, 451, and 752.

b.  This Chapter supplements policies and requirements contained in the
    references cited in (a) above. It is not self-contained, and must be
    read in conjunction with the cited references, and any collective
    bargaining agreements. Requirements of 5 CFR Part 430, 432 and 752
    apply only to OAs covered by Title 5, United States Code.

> c\. A "Supervisory Toolkit" has been developed to assist managers and
> supervisors in the performance of their supervisory duties. It can be
> found at: http://dothr.ost.dot.gov/supervisorytoolkit.

### Policy

> OAs' performance management programs will strive to create a
> results-oriented performance culture by defining, measuring, and
> managing, and improving performance; and by recognizing and rewarding
> results. It is Departmental policy that all performance management
> programs will:

a.  Be applied fairly and equitably;

b.  Be integrated into management processes;

c.  Identify employee, team, and managerial accountability for achieving
    > organizational goals and objectives;

d.  Adhere to merit system principles noted in 5 USC 2301; and

e.  Involve employees and their representatives in program development,
    > implementation and application;

### Definitions

a.  *Critical Element*. A component of a position consisting of one or
    more duties and responsibilities which contributes toward
    accomplishing organizational goals and objectives and which is of
    such importance that unacceptable or unsatisfactory performance on
    the element would result in unacceptable or unsatisfactory
    performance in the position.

b.  *Operating Administration and Departmental Offices.* Refers to the
    Department's operating administrations, including the Bureau of
    Transportation Statistics (BTS), the Office of the Secretary (OST),
    the Office of the Inspector General (OIG), and the Surface
    Transportation Board (STB).

> c*. Managerial Position*. A managerial position typically involved in
> directing the work of an organization, monitoring and evaluating an
> organizations' progress toward its goals, and assuming responsibility
> for the success of specific programs

c.  *Performance Appraisal*. The act or process of evaluating the
    performance of an employee against prescribed performance standards
    or indicators.

d.  *Performance Management*. The systematic process by which an agency
    involves its employees in improving organizational effectiveness in
    the accomplishment of agency mission and strategic goals.
    Performance management has five components: performance planning,
    performance monitoring, employee development, performance feedback,
    and employee recognition.

e.  *Performance Management Program.* The specific procedures and
    requirements for appraisal established within the OAs in accordance
    with the policies and parameters of the DOT Performance Appraisal
    System.

f.  *Performance Plans*. Documents that define the critical (and
    non-critical) elements or results and the performance standards or
    indicators by which an employee's performance will be appraised.

g.  *Performance Standard***.** A statement of the expectations or
    requirements established by management for a critical element at a
    particular rating level. A performance standard may include, but is
    not limited to, factors such as quality, quantity, cost efficiency,
    timeliness, and manner of performance.

h.  *Supervisory Position*. A supervisory position accomplishes work
    through the direction of other people and meets at least the minimum
    requirements for coverage under the [General Schedule Supervisory
    Guide]{.underline} or, if under the wage system, the [Job Grading
    Standard for Supervisors]{.underline}.

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f.  *Team Leader.* A person who is responsible to his/her supervisor for
    ensuring that work assignments of other employees on the team are
    carried out. Team leaders are defined at
    [www.opm.gov/fedclass/gslead.pdf](http://www.opm.gov/fedclass/gslead.pdf),
    which includes a comparison chart between a team leader and a
    supervisor.

## SECTION 2. RESPONSIBILITIES

a.  The Secretary of the U.S. Department of Transportation provides
    overall policy and program direction.

b.  The Departmental Office of Human Resource Management is responsible
    for policy formulation, planning, program administration and
    evaluation; and for establishing Departmental objectives and
    strategies.

c.  OA Administrators are responsible for ensuring program compliance
    with applicable laws and regulations, Departmental policies, and
    collective bargaining agreements. In addition, Administrators shall:

    1.  Communicate the Department's and the OA's missions, strategic
        goals and objectives to all levels within their operating
        administration;

    2.  Establish clear, documented, transparent performance management
        policies and procedures which are applied consistently;

    3.  Establish accountability procedures to ensure that the
        Department's and OAs performance management policies are being
        applied.

    4.  Ensure that administrative approval processes are simple,
        automated, where feasible, and accessible;

    5.  Establish a positive environment that encourages and supports
        performance excellence to achieve the goals and objectives of
        the Department and the OA;

    6.  Ensure a linkage between individual performance and the goals
        and objectives of the Department or the OA;

    7.  Emphasize the importance of communication to define the work
        which is to be performed, to provide feedback on the work
        performed, and to develop effective employees;

    8.  Ensure that performance appraisals are used to make
        administrative decisions concerning training, rewarding,
        reassigning, promoting, reducing in grade, retaining, and
        removing employees;

    9.  Establish recognition programs for rewarding excellent
        performance;

    10. Support managers and supervisors in their efforts to improve the
        performance of employees that are performing at less than
        optimal performance;

    11. Hold managers and supervisors accountable for their human
        capital responsibilities, including dealing with poor
        performers;

    12. Ensure that managers and supervisors receive training on human
        resource principles and techniques;

    13. Ensure that employees are informed of their rights and
        responsibilities;

    14. Maintain appropriate records and submit required data and
        reports on operations, as necessary; and

    15. Monitor and evaluate the effectiveness of the program, and take
        corrective action as warranted.

d.  Human Resource offices are responsible for:

    1.  Communicating to supervisors and the workforce the purpose and
        procedures of the performance management program and its
        relationship to organizational performance;

    2.  Training supervisors and employees on performance management;

    3.  Providing instruction on how to link critical elements with
        organizational goals and objectives, and to establish
        performance standards, which measures results;

    4.  Coordinating and submitting required reports; and

    5.  Ensuring supervisory and employee adherence to performance
        management policies and procedures.

## SECTION 4. MANAGING PERFORMANCE FOR SUCCESS

Effective performance management systems require a framework that
integrates people, planning and performance with organizational
objectives to develop individual and organizational capability that
leads to higher performance. It begins with managers and supervisors who
communicate to employees a clear sense of where the organization is
going and how employees contribute to the overall effort. It holds
managers and supervisors accountable for the success of the organization
and provides them with the necessary tools to achieve that success. It
articulates a philosophy of commitment to achieving the highest level of
performance possible.

Key indicators of effective performance management systems include the
following:

a.  Individual performance expectations are aligned with organizational
    goals;

b.  Crosscutting organizational goals and objectives are achieved
    through collaboration, interaction and teamwork;

c.  Employees routinely use performance information to track achievement
    of goals and objectives, and to identify performance gaps;

d.  Employees are held accountable for making progress in bridging
    performance gaps;

e.  Competencies are used to provide a fuller assessment of performance;

f.  Pay, awards and recognition are linked to individual and
    organizational results;

g.  Meaningful distinction are made regarding employee performance; and

h.  Employees and stakeholders are involved in the design of performance
    management systems

SECTION 4. PROGRAM REQUIREMENTS

a.  Each OA will establish performance management programs that comply
    with the DOT Performance Appraisal System, and with applicable laws
    and regulations.

b.  Each OA's performance management program will:

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1.  Specify which employees are covered, the summary level pattern
    chosen, and the appraisal period;

2.  Specify the procedures and requirements for planning, monitoring,
    developing, evaluating, and rewarding performance;

3.  Require alignment of employee performance plans with Departmental or
    organizational goals and objectives;

4.  Require employee performance plans to contain expectations that are
    clear, specific, and understandable; reasonable and attainable;
    measurable, observable or verifiable; and results-oriented.

5.  Hold managers, supervisors, and team leaders (as appropriate) at the
    GS-15 level (or equivalent) and below accountable for achieving
    business results, managing human capital, managing resources, and
    achieving EEO/Diversity Initiatives.

6.  Direct supervisors to use the performance management process to
    communicate and clarify to employees on an ongoing basis
    organizational goals and objectives, and to identify individual
    accountability for achieving organizational goals and objectives.

7.  Assess employee (or team/unit, as appropriate) performance annually
    and provide at least one progress review during the appraisal
    period;

8.  Provide opportunities for employees to participate in the
    development of their own performance plans.

9.  Recognize and reward individual and team performance that achieves
    results;

10. Use electronic information systems to the extent possible to manage
    performance management, and awards and recognition documentation.

11. Educate managers and supervisors on their performance management
    responsibilities, including communicating organizational goals and
    objectives, aligning performance plans with those goals and
    objectives, recognizing and rewarding performance, and effectively
    dealing with poor performance.

12. Establish policies and procedures for taking corrective action
    against supervisors who fail to address poor performance; and

13. Recognize diversity management and accomplishments.

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a.  OAs may establish more than one performance appraisal system to meet
    differing appraisal requirements of various occupation, geographic,
    or other groups.

b.  OAs with 2-level summary rating patterns shall establish processes
    for distinguishing various levels of performance.

c.  OAs may adopt multi-sources feedback systems or other techniques to
    appraise employee performance.

d.  Employee performance plans may be supplemented with team or unit
    plans and performance contracts, which may be used as part of the
    overall assessment of an employee's performance.

e.  Levels of review and approval of performance assessments will be
    kept to the lowest practicable organizational level.

f.  Employees and their exclusive representatives, as appropriate,
    should be involved in the development of the performance management
    program.

## 

## SECTION 5. PERFORMANCE PLANS

### 

### Development of Performance Plans

a.  Each Departmental employee shall be given:

    1.  A written performance plan within a specified period of time
        (normally within 30 days) from the date of an appointment into a
        new position or the beginning of the appraisal period;

    2.  At a minimum, one progress review at the mid-point of the
        appraisal period; and

3\. An appraisal of performance at the end of the appraisal period.

> b\. Employee performance plans will be aligned with Departmental
> and/or OA goals and objectives.
>
> c\. Employee performance plans will be results-oriented, and should
> include the accomplishment of organizational objectives. For guidance,
> see the Supervisory Toolkit located at:
> http://dothr.ost.dot.gov/supervisorytoolkit

c.  Every performance plan must include the following:

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1.  [Critical Elements]{.underline}. A critical element is a work
    assignment, responsibility, or result to be achieved that is of such
    importance that unacceptable performance in that element would
    result in a determination that the employee's overall performance is
    unacceptable. Critical elements are the cornerstone of individual
    accountability. They describe the work assignments and
    responsibilities that are within the employee's control. All
    performance plans must have at least one critical element.

2.  [Performance Standards]{.underline}. Performance standards are
    statements of expectations or requirements for a critical element,
    which are established at a particular rating level. Performance
    expectations must be clearly stated in writing and can be expressed
    in terms of quality, quantity, timeliness, and cost effectiveness.
    Numerical and non-numerical expectations are permitted; however,
    performance expectations should be as specific as possible.

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d.  The performance of every manager, supervisor and team leader (as
    appropriate) at the GS-15 level (or equivalent) and below will be
    evaluated on the following four areas, as defined below: (1)
    Business Results; (2) Managing Human Capital; (3) Managing
    Resources; and (4) Diversity/EEO Initiatives. See Appendix A,
    Indicators of Achievement for Managers and Supervisors, for
    examples.

> 1\. [Business Results]{.underline} - Interprets, communicates,
> implements and applies DOT strategies, goals, objectives, policies and
> procedures. Develops operational and/or program strategies for
> attaining delivery of products and services that result in customer
> satisfaction or performance meeting pre-determined objectives.
> Effectively brings about changes to achieve significant and sustained
> improvements in organizational and employee performance.
>
> 2\. [Managing Human Capital]{.underline} - Applies human capital
> strategies and human capital management techniques, and utilizes
> appropriate HR flexibilities to attract, retain, and leverage the
> skills and knowledge needed in the organization. Collaborates with
> human resource personnel on conducting workforce analysis to identify
> current and future leadership needs, employee competencies and
> staffing levels within office or organization. Supports and plans for
> organizational and employee developmental needs, and creates an
> environment for continuous learning. Motivates and guides employees in
> achieving DOT and organizational goals. Acknowledges and rewards
> superior performance. Addresses, attempts to resolve, or takes formal
> actions relating to performance or conduct problems.

3.  [Managing Resources]{.underline} --Communicates with and involves
    employees in the decision making process. Implements DOT business
    processes using a variety of resources to achieve goals. Utilizes
    resources to support change processes. Insures that resources are
    used effectively to produce results. Allocates and monitors usage of
    financial and physical resources within actual span of control.
    Anticipates future requirements, develops plans and establishes
    priorities. Considers immediate and long-term needs in determining
    resource allocation. Develops management controls and takes actions
    to reduce agency vulnerability.

> 4\. [Diversity/EEO Initiatives]{.underline} -- Emphasizes the value of
> EEO and diversity efforts through effective leadership. Shows
> consideration for cultural diversity and other differences, resulting
> in an environment where people work together to achieve organizational
> goals. Demonstrates sensitivity to individual and cultural differences
> and ensures that different views are taken into consideration.
> Promotes change and new information, adapting work behavior and
> methods accordingly.

**[Performance Assessment Process]{.underline}**

a.  OAs are required to assess each employee's performance annually and
    to provide ongoing assessments throughout the year, including a
    progress review.

b.  When assessing performance, supervisors and managers will measure an
    employee's performance in as an objective manner as possible.

c.  Managers and supervisors should encourage employees to submit
    self-assessments of their performance for supervisory consideration.

## SECTION 6. MANAGING POOR PERFORMANCE

A results-oriented culture holds managers and supervisors accountable
for achieving success. This requires managers and supervisors to monitor
the performance of their employees, provide feedback, and to hold them
accountable for achieving performance expectations. When an employee's
performance drops below the fully satisfactory level, managers and
supervisors are responsible for identifying the performance problems and
providing assistance to the employee to improve performance. If informal
attempts to improve performance are unsuccessful, managers and
supervisors are required to take appropriate formal steps consistent
with 5 CFR Part 432 or 5 CFR Part 752. See DPM Chapters 432 and 752 for
further direction.

## SECTION 7. EMPLOYEE RECOGNITION

a.  An award and recognition program designed to recognize deserving
    employees must be a component of a performance management program.

b.  Each OA shall manage award funds to reward employees, teams, and
    units based on results, and provide incentives to employees to
    achieve high levels of performance.

c.  OAs may link performance bonuses to specific performance ratings.

d.  OAs shall establish informal recognition programs, and encourage the
    use of non-monetary forms of recognition in its overall strategy to
    manage and improve performance. Each OA's strategy shall include a
    plan to increase managers' awareness of the various forms of
    meaningful employee recognition available under the strategy.

e.  OAs with 2-level summary rating patterns shall establish processes
    for distinguishing levels of performance within their awards and
    recognition programs.

## SECTION 8. TRAINING

OAs shall include a significant module on performance management in
supervisory training. Performance Management training should focus on
"managing for results," and address the following: linking individual
performance and organizational goals and objectives; using the
performance management process as a management tool; defining and
establishing outcomes; establishing and applying objective measures of
performance; and using various forms of rewards and recognition to
improve performance.

**SECTION 9. EVALUATION OF PERFORMANCE MANAGEMENT PROGRAMS**

Each OA shall monitor and evaluate its performance management program
for compliance with DOT policies, and law and regulation. OAs will
document its procedures for ensuring employee compliance with its
program policies.

## SECTION 10. APPROVALS

OA performance management programs must be submitted to the Departmental
Office of Human Resource Management for review and approval prior to
implementation. Modifications may be made without prior approval from
the Department as long as such modifications conform to the requirements
established in this chapter, and there is no change in the program's
coverage, appraisal period, or summary rating pattern. A copy of any
modification shall be provided to the Departmental Office of Human
Resource Management's Performance Management Program Manager.

#### APPENDIX A. INDICATORS OF ACHIEVEMENT FOR MANAGERS AND SUPERVISORS

Managers, supervisors and team leaders (as appropriate) are to be
evaluated against four critical areas. Below are examples of indicators
of achievement that may be used by raters.

[Business Results]{.underline}

-   Customers are satisfied with the timely and efficient delivery of
    quality products and services.

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-   The majority of decisions concerning X activities are sound and
    further the organization's goal of achieving its business objective.

    -   Products are produced on time and on budget.

-   Results are achieved using networking and accepted organizational
    practices.

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-   Effectively uses balanced scorecard measures to pursue business
    excellence and is an effective change agent.

-   Establishes timely and appropriate accountability processes
    throughout the organization, and holds self and others accountable
    for achieving goals.

-   Written documents are clear, accurate, concise, and grammatically
    correct. Rarely are documents returned for correction and/or
    additional information.

-   Assigned projects are completed by deadline, with X percent
    accuracy, and in accordance with customer specifications.

-   Results of surveys (or customer feedback) indicate organizational
    improvement and increased customer satisfaction.

[Management of Human Capital]{.underline}

-   Performance plans are prepared on employees within established
    timeframes; progress reviews are held at mid-cycle; and final
    appraisals are prepared within 30 days of the end of the appraisal
    cycle.

-   Employees understand how their performance supports organizational
    goals.

-   Work objectives are results-oriented and aligned with Departmental
    and operating administration strategic goals and objectives.

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-   Collaborates with employees in all aspects of the performance
    management processes, including development of individual
    development plans.

-   Performance feedback is continuous, clear, and constructive.

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-   Creates an environment for continuous learning.

-   Recruitment and hiring efforts are effective and timely.

-   Resolves employee work issues, such as poor performance, misconduct,
    grievances, complaints, workplace hazards, security and safety
    matters.

-   Timely recognizes and rewards levels of performance throughout the
    year.

-   The flow of information is up, down, and across the organization.

-   Is cooperative, a team player, and shares his/her knowledge/skills
    to accomplish an organizational goal.

-   Leads by example, through display of high standards of honesty,
    integrity, trust, openness, and respect for individuals.

-   Practices good listening skills and respects the opinion of others.

-   Written documents are clear, accurate, concise, and grammatically
    correct.

-   Results of employee satisfaction surveys indicate employees are
    aware of how their job fits into organizational goals, and they are
    satisfied with the amount and effectiveness of communication from
    their supervisor on their performance.

-   Morale and team cooperation is high within the organization. Very
    few employees complain regarding their work environment.

-   Prepares timely and effective workforce analysis' to identify
    leadership needs, employee competences, and staffing levels.

[Management of Resources]{.underline}

-   Resources are linked to Departmental and/or operating administration
    goals and objectives in a timely manner.

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-   Authorized resources are adequate to support and/or facilitate
    change management process.

-   Effective labor/management collaboration results in timely
    collective bargaining agreements or understandings.

-   Provides sufficient autonomy and authority to employees to improve
    work processes and products.

-   Effectively manages and/or timely participates in the budgetary
    process, which may include preparing and justifying a budget and
    operating the budget under organizational and/or Congressional
    procedures.

-   Implements cost-effective approaches to financial resources, which
    may include management of overtime, travel and procurement of
    supplies and equipment.

-   Appropriate mechanisms are developed to prevent waste, fraud and
    abuse and instill public trust.

-   The organization has achieved X percentage of savings through
    effective management of travel, overtime and/or procurement of
    supplies.

-   Employees do not hesitate to make recommendations to improve work
    processes or products.

[Diversity/EEO Initiatives]{.underline}

-   Communicates Departmental and/or operating administration policies
    on affirmative employment, EEO and diversity to all employees on an
    annual basis and reinforces those policies throughout the year.

-   Creates a positive work environment that encourages mutual respect,
    communication, innovation, learning and support of EEO and
    diversity.

-   Applies EEO principles to personnel management (e.g., hiring,
    training, work assignments/schedules, discipline, counseling and
    awards).

-   Monitors work environment to prevent instances of prohibited
    discrimination and/or harassment.

-   Takes timely corrective action if sexual harassment, or other
    discriminatory/unfair treatment is observed, reported or suspected.

-   Participates in EEO/Affirmative Action/Special Emphasis Programs and
    activities and encourages subordinates to do the same.

-   Cooperates with EEO counselors and investigators, or other officials
    responsible for conducting inquiries into EEO complaints in a timely
    manner.

-   Optimize employees' skills and abilities, and promotes opportunities
    for career growth.

-   Timely recognizes employee performance in the areas of diversity,
    equal employment opportunity and affirmative action.

-   Employees have not filed any complaints during rating year.